Managing Contracts Using Excel: A Detailed Guide [With Template]

To date, Microsoft Excel is the most accessible and cost-efficient tool for managing contracts. It is easy to operate and requires minimal training, making it a go-to choice for legal professionals to handle their contracts. As per Artificial Lawyer, 62% of General Councils still use tools like Excel, Sharepoint, and Email to manage contracts.

However, to leverage Excel’s capabilities and features for contract management, you will need a robust template with all functions and formulas in place. Wondering where to find a template that fits the bill? Look no further.

This blog offers detailed information on using Excel for contract management. Use our free contract management Excel template and follow our systemic process to get started with Excel-based agreement management. Let’s dive in.

What is Excel-based contract management?

Excel contract management refers to the process of using Microsoft Excel to manage, track, store, analyze, and organize the contract portfolio. This is a semi-digital approach to contract management where organizations shift from traditional, paper-based processes to digital platforms for handling contract documents.

With Excel, organizations create centralized spaces to store, analyze, track, and manage business contracts and legal documents. Contract managers, legal professionals, compliance managers, and department managers can access this space.

But, what is the need to manage contracts with Excel? Let’s find out in the coming section.

Why use Excel for contract management?

Excel is one of the most commonly used productivity tools at present. Its simplicity and accessibility make it a leading choice of tool for contract management. Here are the key benefits of managing contracts in an Excel sheet:

1. Cost-effective way to get started

Purchasing a dedicated contract management software can be an expensive and inviable option for small-scale organizations. As per TrustRadius, the cost of a contract management solution can be as high as USD 200 per user per month. On the other hand, Excel is a cost-efficient way to get started with contract management. Most organizations already use the Microsoft 365 suite, making Excel useful for managing contract management processes.

2. No additional training required

Managing contracts with a CLM (Contract Lifecycle Management) tool requires additional training on features and functionalities. However, most organizations and individuals are familiar with at least basic Excel functions and features. Creating filters, managing sheets, and customizing ranges are no-brainer tasks in Excel and can be done with no extra training.

3. Easy inter-department sharability

Excel templates make it easy to share contract data among cross-functional teams like procurement, sales, finance, and legal. You can simply provide the Sheet’s access to different teams and enable access to insightful contract details and insights.

Now that you know why Excel is an excellent choice of tool for managing contracts, let’s take a look at the free Excel template for effective contract management.

Free Excel contract management template

If you want to manage contracts using Excel sheets, you will need a template or a format that can handle your legal documents. This format should be designed for optimal visibility over all contracts at a glance.

To save you the trouble, we have created a simple contract management template that works well with all types and complexities of contracts. This template covers all the critical contract management components and is available for you to download and use. Click the below image to download the Excel template.

Use this template and get started with Excel contract management. However, know that managing contracts using Excel comes with considerable challenges and setbacks. The coming section talks about these challenges.

6 reasons why you should not manage contracts using Excel

According to a WorldCC study, an average company loses 9% in contract value due to mismanagement and manual processes. This estimate is even higher for larger organizations, at 15%. Relying on tools like Excel to manage hundreds of approvals, obligations, compliance requirements, and other contracting inefficiencies. Here’s how:

1. Manual obligation and milestone tracking

Tracking contracts, managing obligations, and ensuring commitment fulfillment are essential functions of contract management. However, with Excel, obligation tracking becomes cumbersome due to limited notification and alert functionalities. When organizing large contract datasets with Excel, it becomes challenging to keep a record of every milestone and obligation. This exposes organizations to missed obligations.

2. Reduced visibility over contractual performance

Every contract manager is concerned with one pressing question: “How well are the contracts performing?” Robust contract performance management helps derive insights and identify and eliminate process bottlenecks. Excel does not offer functionalities to track and monitor contract performance, taking away the essential CLM insights from contract managers.

3. High chances of non-compliance

Contractual non-compliance is disastrous for any organization. It hampers business relations, leads to lawsuits, and often ends up in contract termination. When managing contracts with Excel, contract managers, and other key stakeholders often end up missing crucial compliance requirements, primarily due to the lack of visibility over them.

4. Compromised contract security and confidentiality

Contracts contain sensitive business information, trade secrets, and other confidential data, and thus need to be protected. By managing and storing contracts in Excel sheets, you considerably compromise on confidentiality. This may result in contract violations and breaches, leading to lawsuits.

5. More time spent on manual data entry and extraction

When managing contract data in Excel sheets, contract managers have to manually enter all the necessary information. Moreover, this information needs to be updated as the contract gets refreshed and renegotiated. Manual data entry is a time-consuming task and can end up becoming a major bottleneck in CLM.

6. Increased risk of human errors and negligence

Manually entering contract data into Excel sheets and managing agreements is error-prone on account of human negligence. When entering information on hundreds of contracts every day, there are chances of data errors, which is a common root cause of contract mismanagement.

Excel is not your best choice for managing contracts. So, what is the solution? For successful contract management, we recommend you use contract automation software. Let’s find out why.

Contract management software: A better way to manage contracts

Contract management systems are dedicated platforms designed to handle the entire contract lifecycle. Platforms like HyperStart CLM use artificial intelligence technology to automate the contract management process, thus aiding efficiency.

Here are the benefits of using contract management software over Excel:

1. Automates repetitive tasks and auto-extracts data with AI
2. Offers better visibility through a centralized dashboard
3. Promotes safe contract storage in a secure repository
4. Automates alerts for upcoming obligations
5. Helps identify and eliminate CLM bottlenecks with ease

Let’s understand each of these benefits in detail.

1. Automate repetitive tasks and auto-extract data with AI

2. Get better visibility through a centralized dashboard

3. Store contracts in a secure repository

4. Get automated alerts for obligations

5. Easily identify and eliminate CLM bottlenecks

Using contract management platforms is a better option than managing contracts with Excel. There are many cost-efficient and advanced contract management platforms like HyperStart CLM that you can use instead of Excel sheets.

Simplify contract management with HyperStart CLM

While Excel is accessible, it is not designed to manage contracts. There’s a better way with AI-powered contract lifecycle management software like HyperStart CLM.

HyperStart CLM helps overcome the drawbacks of traditional Excel-based contract management with powerful AI and smart contract management features. With HyperStart CLM, you can go above and beyond with contracts and create, review, redline, approve, sign, store, track, and analyze all agreements centrally. Here’s how:

Still unsure? Book a demo today and see HyperStart CLM in action. Get started with a 14-day free trial.