Contract Management

Contract management in procurement is the process of creating, executing, monitoring, and optimizing agreements made with suppliers to ensure that both parties meet their obligations and achieve the intended value from the contract. It covers the entire contract lifecycle—from initial drafting and negotiation to performance tracking, renewal, or termination.

Effective contract management helps organizations reduce risk, ensure compliance, and capture savings by preventing issues like missed deadlines, non-performance, or cost overruns. It typically involves activities such as contract creation, version control, approvals, performance monitoring, supplier communication, and maintaining a centralized contract repository.

Modern procurement teams often use contract lifecycle management (CLM) software to automate and streamline this process, improve visibility, and ensure consistency across supplier agreements.