The $2.7 trillion agreement trap: APAC's economic impact

New research from Docusign and Deloitte indicates that poor agreement management, termed as the "Agreement Trap," results in a global economic loss of nearly AUD $2.7 trillion annually.

This loss is attributed to outdated systems and processes that leave vital business information trapped within static and disconnected files.

According to the report, the Asia-Pacific (APAC) region, encompassing Australia, Singapore, and Japan, alone accounts for 31% of these global losses. This translates to an estimated economic value loss of AUD $770 billion to AUD $930 billion annually, positioning APAC as the second highest region in losses after North America. APAC's economic impact of the Agreement Trap is projected to grow to AUD $3.6 trillion globally by 2030 if unaddressed.

Shaun McLagan, Group Vice President and General Manager for APAC and Japan at Docusign, explained the consequences of inefficient agreement management: "Agreements are the cornerstone of every business and outdated management systems and practices are impacting productivity, costing businesses time, money, and opportunity.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 modernize agreement processes and grow their businesses more efficiently and quickly."

The findings shed light on several productivity challenges. Companies with disconnected workflows spend an additional 18% of their time working on agreements, significantly affecting productivity, employee morale, and bottom-line results. Globally, companies waste approximately 190,000 hours annually due to disconnected agreement management workflows, culminating in 55 billion hours lost each year. Furthermore, APAC organisations, with a current tool adoption rate of 35%, process agreements 6% slower than the global average.

Other noteworthy findings include a high prevalence of delays related to manual processes and inefficiencies in the development and signing stages of contracts. About 40% of participants from APAC cited delays from these manual processes compared to 32% from other regions. Additionally, 62% of respondents mentioned difficulties in locating and accessing previously approved contracts, while 49% experienced delays in obtaining the correct signatures in the proper order.

Underlying pain points were also highlighted in the report. A significant portion of respondents cited the manual entry of agreement data into downstream, disconnected systems as a major issue. Half of the respondents expressed feeling overwhelmed by the volume and complexity of their agreements, and around 40% indicated a need for more effective collaboration tools. Only 36% reported using intelligent contract analytics tools, and a mere 31% used a centralised, searchable contract repository.

Tom Hyde, Head of APJ & China, Sales and Success at Canva, commented on the integration of Docusign's Intelligent Agreement Management (IAM) within their workflows: "The integration of Docusign into our workflows has been transformative for the rapid growth of our team. Docusign's transition to Intelligent Agreement Management (IAM) will help us streamline operations and significantly reduce the time and risks associated with traditional agreement processes. Ultimately, Docusign helps ease administrative hurdles so we can focus on innovating and bringing even more value to our community around the world."

In response to these challenges, Docusign has introduced Docusign Intelligent Agreement Management (IAM), leveraging advanced artificial intelligence to represent a significant evolution in business agreement management.

Specifically, IAM allows businesses to create agreements in a collaborative, automated, and integrated manner with all business processes and CRM systems, accelerate contract review cycles, enhance productivity, and transform agreement data into actionable insights. Businesses can also manage agreements more effectively by uncovering hidden information, unlocking value, and reducing unnecessary risks.