How Contract Intelligence Overcomes Supply Chain Disruptions

Supply chain disruptions affect nearly every part of global commerce. Climate related issues, COVID-19, and many other issues can affect the flow of goods, driving up prices and straining supplier and customer relationships.

Organizations around the world are doing everything they can to mitigate the effects of supply chain disruptions. While adjusting inventory and using advanced planning tools are important, many companies in this situation may still be overlooking the very first step in the supply chain process – the contract.

Where Contracts Fit in the Supply Chain

While no supply chain can ever be completely insulated from changes or disruptions, organizations can temper some of their own personal burden at the contract stage. Companies should ensure that any agreement they enter into features clear and precise language regarding disruptions so that sellers and buyers both know exactly what they are responsible for and what they are entitled to.

While this sounds straightforward, modern contract lifecycle management (CLM) is complex. With hundreds of different parties across the globe, many contracts are written in different languages and stored as PDFs siloed away in disjointed systems. In some cases, companies must deal with hundreds of pages across thousands of contracts, often leaving room for interpretation over who is responsible for which aspects of a supply chain.

To help overcome these issues, the CLM experts at Icertis offer the ICI Sourcing App as part of their Icertis Contract Intelligence (ICI) platform. This solution ensures that contracts are the focal point of any sourcing process, clearly dictating the terms of any agreement to all applicable parties while ensuring compliance.

By providing all parties with a holistic understanding of the overall supply chain and their role within it, companies can minimize the risk of supply chain disruptions and work more efficiently to find solutions if a disruption occurs. Powered by AI, this tool can also help companies find ways to make their sourcing processes more efficient and find avenues for savings throughout the process.

Conclusion

The modern supply chain is a long, complex workflow that faces many different obstacles. Organizations should do everything in their power to maximize clarity and communication throughout the process and understand how to overcome any issues that may arise.

The first step in this process is ensuring that all contracts are clear to all parties, and provide context for the overall supply chain to help drive improved decision making. More and more, organizations are turning to contract lifecycle management partners like Icertis to drive contract intelligence and help stamp out supply chain issues before they arise.