Cash Is Still King And Everything Else Is Rusty
With balance sheets of many companies flush with record amounts of cash you would think that the economic recovery would be well on its way as investments are made in equipment, technology, and additional employees. Instead, over 2 trillion dollars lie dormant in the bank accounts of companies. Many corporations are choosing to sit on their cash or returning the money to shareholders in the form of dividends rather than invest. Why is this the case?
A liquidity crunch in 2008 and 2009 drove companies to hoard cash. The resulting political and economic uncertainty then motivated companies to hold on to this cash. Generally, organizations invest capital when they have a need, have confidence in the economy in the near term and conclude that parting with their cash will provide a return to the company greater than holding on to their money. Unfortunately, two or more of these conditions have not been present over the past 3+ years.
The lack of investment has created a situation where more and more companies have pent up demand for those things that make their businesses work. The need has not gone away, just the willingness by far too many companies to invest. Whether it be plant and equipment, improved software to automate processes or additional employees, many companies are chock full of things that need to be replaced, repaired, upgraded or simply invested in. When businesses once again become confident about the sustainability of the economic recovery, the U.S. economy will likely see a period of rapid growth. Let’s hope that happens sooner than later. There’s only so much duct tape and bailing wire to go around.
So what can your company do to prepare for brighter days ahead? Many companies are making investments in contract lifecycle management software. By standardizing and automating their contracting processes they create scalable platforms to handle higher volumes of contracts using the same or fewer resources. Improvements in efficiency, compliance, transparency and reporting are all benefits of CLM. For most companies, 70% or more of their spend and revenue comes through contracts. Unfortunately, most organizations currently employ manual ad hoc processes that rely on Microsoft Word and Outlook. Is this good enough? It might be if customers, vendors and internal resources are all bragging on the efficiency and effectiveness of your contracting process. If you aren’t hearing those compliments chances are it’s time to roll up your sleeves and make wholesale changes to how contract work is performed in your organization. We all know when things get busy there will not be adequate time to address what should have been done before. Click here to contact us to show you what is possible using Microsoft Office and SharePoint technology in which your organization is already invested.
By: Darrin Poole