TEI of DocuSign CLM Shows 356% Return on Investment

For this 2020 study, DocuSign commissioned Forrester Consulting to detail the way customer workflows have improved using Contract Lifecycle Management (CLM), and the direct results of those changes as measurable impacts on the business. The results are tabulated in The Total Economic Impact^tm of DocuSign CLM. 

The purpose of this study is to provide you with a framework to evaluate the potential financial impact of DocuSign CLM on your organization. To calculate the possible return on investment, Forrester performed two types of analysis:

• Analysis of benefits 
• Analysis of costs

Here are noteworthy results:

• Composite organizations using DocuSign CLM over 3 years experienced an ROI of 356% according to customer interviews and financial analysis
• Organizations reduced their contract process time by 83%
• Those same organizations saved over $4 million on contract processing costs 
• Revenue increased by almost $339,000 over three years 
• Reliance on outside contract support was reduced, saving over $1.3 million in outsourced costs and reduced risk of exposure by 5%

The ROI of Contract Lifecycle Management

Customer interviews and financial analysis found that a composite organization using DocuSign CLM experiences an ROI of 356% with significant savings from reducing:

• Contract process time and cost
• Risk of exposure
• Reliance on outside legal/consulting services
• Agreement error rate

Forrester’s analysis found that the composite organization experiences benefits of $7.73 million over three years versus costs of $1.69 million, adding up to a net present value (NPV) of $6.03 million and an ROI of 356%.

One senior systems analyst said: “It’s a huge advantage for us because for our end users, everything is compliant and correct the first time. The throughput time is known upfront, and that's priceless.”

Benefits of implementing CLM 

1. Decreased turnaround time and cost of contracting

Customers were able to speed up contract turnaround time by 20 days on average. This increased efficiency was felt by employees in contract-related roles including sales teams, procurement professionals, and internal counsel.

2. Reduced outside counsel spend

Organizations eventually reduced outside legal support to zero. For the composite organization, this resulted in 50% of cost savings per contract.

3. Reduced error rate and contract value leakage

Centralized contracts in one searchable place enabled customers to identify automatic subscription renewals, redundant vendor contracts, and purchases that could benefit from volume discounting. It also allowed customers to renegotiate contract terms using the organization’s consolidated buying power.

4. Reduced risk exposure in contract lifecycle

Customers reported less risk exposure and improved compliance adherence after investing in Contract Lifecycle Management. They described improving contract processes, which helped them avoid fines that could amount to millions of dollars.

5. Accelerated revenue from improved contract processes

Customers were able to accelerate the contract process by 83%. The increased efficiency of contract processes allowed teams to close deals that would previously have been lost to competitors due to lengthy contract timelines.

DocuSign CLM saves costs and reduces vendor overspend, but it’s more than that. By centralizing contracts, you’re getting others to look at a contract. You will catch all these other pieces of the puzzle that some people may never think about.   

— Vice President of global procurement and real estate, technology

A business case for CLM investment

The study revealed several key areas for consideration when preparing a business case for the value that contract lifecycle management can deliver.

• The time it takes to generate contracts today
• The level of risk in not having visibility into terms and conditions across all contracts
• The time it takes for contract review and routing 
• How contracting affects total sales cycle time
• Spend on outside counsel for contract search and discovery

Forrester Consulting interviews found CLM customers reduced contract processing time by 83%, closing deals more rapidly. One senior project manager from the logistics industry described the sales cycle going from nine weeks to two days with DocuSign CLM. 

Time is money. Spending fewer days finalizing an agreement means your company has more days to recognize the revenue that results from that deal. And your sales team has more time to spend on closing the next deal.

Download the full study Forrester Consulting, The Total Economic Impact of DocuSign CLM.