Can You Put Your Hands on Every Contract? Most of Us Can’t

Introduction

Let’s start with a question: If you had to find every active contract your company is currently committed to, could you? 

If your answer is “perhaps” or “not quite”, you’re not alone. In fact, you’re in the majority. Despite years of investment in contract tools, most businesses can’t confidently say they have a full picture of their contracts. According to Deloitte, 70% of organizations lack visibility into key contract obligations.

It’s a quiet but costly problem, and one that’s been overlooked for too long. 

What Makes Contract Discovery So Hard?

The core issue isn’t complicated: we don’t know where all our contracts are, and we’re not certain which ones are still active.

Given the importance of these documents, what is puzzling is why this should be the case. As it turns out, the reasons behind this are as messy as the problem itself. 

Contracts are Stored Everywhere

According to CLM vendor research, the average large enterprise stores contracts in about 24 different locations. Many of these are likely to be file shares, but contracts also reside in SharePoint sites or e-signature tools like DocuSign. A few digital laggards are still on paper in filing cabinets.  

"A Contract" vs "The Contract"

Even when you do find a file, it may not be the file. It’s often just a version, not the one that’s currently active. There could be variations, addendums, or approvals elsewhere, with no links between them. 

People Leave, and Contracts Leave with Them

When someone leaves the company, their laptop or inbox is sometimes the only place a particular contract is stored. Getting them back from there is challenging, and sometimes, if the laptop has been wiped, impossible. 

CLM Systems Were Never Designed for This

Contract Lifecycle Management (CLM) tools were built to author contracts and manage them from there. Their blind spot is contracts created elsewhere. Accordingly, CLM vendors focus on tracking what’s already been captured, not uncovering what’s missing. 

Even the AI isn't Looking Hard Enough

Some CLM vendors promise artificial intelligence as a solution to the problem of ‘dark contracts’, but today their AI actually supports structured data ingestion, not exploratory file mining or triage. In other words, someone still has to know where the contracts are before the system can do anything useful with them. 

Why it Matters for Procurement

Increasingly, procurement teams are expected to be strategic advisors, not just cost-cutters. But that role is impossible to play if your contracts are scattered across the organization, which is the situation many teams inherit. The ability to manage supplier performance, track risk, or renegotiate agreements are all diminished as a result. 

It also makes M&A due diligence challenging, leads to automatic renewals of unwanted contracts, and increases the chance of non-compliance across supplier obligations. 

Even the most organized companies aren’t immune. Each time they acquire a new entity, they inherit that company’s filing practices and legacy contracts, often scattered across unfamiliar systems or poorly catalogued. Without discovery, those inherited obligations can remain invisible until they become a risk. 

Why This Has Been Ignored

Firstly, there’s broad agreement that contract data isn’t up to scratch. According to WorldCCM (2023), only 29% of executives describe their contract data as “highly reliable”, and nearly two-thirds of contract managers go further, calling it poor. That’s a consensus that the quality isn’t where it needs to be. 

Secondly, most CLM vendors focus on what’s already visible, because their offerings are used to create contracts first and store them afterwards. CLM systems offer real value in streamlining workflows, enforcing compliance, and providing a centralized repository for managed agreements. But they were never designed to uncover what’s been overlooked, which is why contract discovery remains outside their remit. 

So What Can We Do?

At Digital Mirror, we’ve decided it’s time to think about the problem differently and get back to basics. As part of our unique approach to Contract Performance Management (CPM), we provide a secure discovery agent that crawls the places contracts like to hide (like shared drives), de-duplicates them, and extracts key metadata to assess and rank their likelihood of being an active contract. 

We also detect potential amendments or expired versions, so you can focus on what’s current. 

Contract Discovery is the crucial first step, but it’s not the end of the story. To make sure nothing is missed, we also cross-check against the General Ledger (GL) as part of our working capital process. The GL shows the suppliers you are actually paying and the volumes involved. In other words, the real business relationships that should be under contract. Discovery ensures you can find every contract in your environment; GL scanning validates that every business relationship has one. Together, they provide a complete picture. 

We’re not here to replace your CLM - we don’t manage workflows or handle the legal back-and-forth. Our discovery agent is designed to meet the most basic requirement for contract performance – identifying where all your contracts are and whether they are active or not.    

We’re launching our discovery agent soon. If you’re curious whether your contract landscape is as complete as you think, we’d love to show you what we’re seeing.