Nearly $2.7 trillion in global economic value is lost every year due to the ‘Agreement Trap’ – where poor agreement management costs businesses time and opportunities due to outdated systems and processes that trap business-critical information inside static, disconnected, and flat files, according to new research from Docusign and Deloitte.
APAC alone accounts for 31% of the $2.7T in losses, representing $770 billion to $930 billion in lost economic value and ranking second highest among global markets.
Docusign group vice president and general m,anager for Asia Pacific and Japan, Shaun McLagan spoke to the reasons for this opportunity loss: “Agreements are the cornerstone of every business and outdated management systems and practices are impacting productivity, costing businesses time, money, and opportunity. That’s why we’ve introduced Intelligent Agreement Management to help organisations in APAC modernise agreement processes and grow their businesses more efficiently and quickly.”
The economic impact of the Agreement Trap sees more than half (52%) of global respondents wait for identity and notary verification, introducing deal closure risks and suggesting that legacy contract management systems are unfit for the fast-paced digital economy.
Meanwhile, over 40% of global respondents missed opportunities to either capitalise on growth (e.g., renewal) or cost (e.g., volume discounts) due to their inability to extract value from agreement metadata.
Productivity challenges
Companies with disconnected workflows spend an extra 18% of time working on agreements—which has a material impact on productivity, employee morale, bottom-line, and long-term business outcomes.
Globally, companies on average waste 190,000 hours annually from disconnected agreement management workflows—or 55 billion total hours lost each year.
As relatively recent adopters of agreement management solutions—with a current tool adoption rate of 35%, behind North America at 46%—APAC organisations process agreements 6% slower than the global average. Two in five (40%) APAC participants reported delays from manual, inefficient processes in the development and signing stages of a contract compared to 32% in other regions.
Almost two-thirds (62%) of respondents say they struggle to locate and access previously approved contracts and 49% experience multiple delays in obtaining the correct signatures in the proper order.
Underlying pain points
Over half (54%) of respondents cited manually entering agreement data into downstream (disconnected) systems as a pain point, while 50% feel overwhelmed with managing the volume and complexity of their agreements. About 40% of respondents report needing more collaboration tools and capabilities, the lack of which results in delays and re-works.
Only 36% of respondents reported using intelligent contract analytics tools, and an even lower 31% reported using a centralised, searchable contract repository.
How IAM unlocks businesses from the Agreement Trap
In response to the challenges facing businesses and leaning on decades of experience as the market leader, Docusign has introduced a new SaaS category with Docusign Intelligent Agreement Management (IAM). Leveraging new advances in AI, Docusign IAM represents a significant evolution in the way businesses manage their agreements.
It allows Australian businesses to create agreements in a collaborative, automated, and integrated way with all business processes and CRM systems; commit to agreements faster by accelerating contract review cycles, enhancing productivity, and transforming agreement data into actionable insights, and manage agreements better by unveiling the information hidden within, unlocking value and reducing unnecessary risk.