Getting organizational stakeholders on board with a new Contract Lifecycle Management (CLM) system can be like herding cats. One is distracted by a mouse running around. Another found some catnip. The others? They must be around here somewhere...
Each stakeholder is so focused on their own goals and priorities that it can be hard to shift their attention toward a new CLM. After all, it's not their job to select and implement a CLM in the first place.
So what’s the solution? Show these stakeholders the connection between adopting a CLM and their specific organizational goals. Sharing the department-specific ROI your CLM tool delivers is one great way to do it—like using catnip to get them excited about adoption.
How do you do that? Well, I’m glad you asked.
This blog will show you how to use the ROI of a CLM to secure organizational buy-in, with tips taken directly from my ebook, The Get Started Guide: Building the Business Case for a CLM.
Why ROI Matters
In any organization, the decision to adopt any new system hinges on its expected ROI. ROI is simply the language of business. But here's the twist: demonstrating ROI isn't just about showing the data; it's about showing the data that matters most to each department in a way that tells a story they can get excited about.
- Finance: For Finance, the ROI of cost management is crucial. They look at how a CLM can cut costs, better manage spend, and—importantly—reduce the risks of mishandled contracts. Speaking their language means showing ROI that highlights financial savings and risk reduction.
- Sales: Sales teams value speed. Showing that a CLM system can shorten the sales cycle, close deals quicker, and boost revenue is compelling for them. It's about linking the investment to faster, bigger wins.
- Procurement: Procurement aims for the best value and good vendor relationships. Their kind of ROI will showcase a CLM's ability to make negotiations smoother, ensure rules are followed, and improve vendor management to meet their goals.
By aligning the ROI you present with your specific stakeholder's goals, you're speaking their language. This not only shows the CLM system's value but does it in a way that each stakeholder can relate to.
Crafting Your ROI Pitch
Incorporating these ROI figures and scenarios from the ebook into your pitch can help stakeholders visualize the tangible benefits of a CLM system. By aligning these insights with the unique priorities of each department, you'll be better equipped to build a case that resonates strongly with every key player.
- Finance ROI: Highlight how a CLM can reduce contract approval and turnaround times, leading to a decrease in administrative costs and faster revenue recognition. Tease out the expected reduction in operational costs.
- Sales ROI: Showcase how a CLM can help shorten sales cycles, allowing sales teams to close more deals in less time. Reiterate the direct connection between faster sales cycles and increased revenue.
- Procurement ROI: Underscore how a CLM can improve spend management and renewal tracking, resulting in real cost savings. Show how a CLM can streamline vendor contracting and approval processes to speed up contract turnaround times, improving outcomes and relationships.
Effective communication of ROI requires a combination of solid data, clear benefits, and personal engagement. With the right approach, you can build a compelling case that not only demonstrates the value of a CLM but also aligns with the strategic goals of every department.
Understanding Adoption Rates as ROI Indicators
When talking with stakeholders about the ROI of a CLM, another valuable metric to share is the CLM’s adoption rate. High organizational adoption rates can signal that a system not only meets but exceeds the operational needs and expectations of its users.
We regularly hear from Lexion's users, for example, that gaining company-wide adoption for the platform was quick and easy. A high adoption rate is more than a number; it's a testament to the system's ease of use and the immediate value it brings to users.
Sharing with stakeholders that the CLM you are pushing for has a high adoption rate will help show them that you’ve done the work of vetting a CLM that delivers on its ROI promises. It’s a great way to underscore and is a great wrap-up point to use after you’ve dived into the unique ROI the system delivers.
In Closing
As you work to secure a CLM system for your organization, remember that demonstrating the ROI is crucial. But equally important is bringing those numbers to life by telling a story that shows the CLM’s impact on those things that matter most for each stakeholder.
Interested in more tips to help you build a compelling business case for your CLM? Download The Get Started Guide: Building the Business Case for a CLM for more tips on securing CLM buy-in across your organization, with even more insights, strategies, and real-world examples.
