There is a figure that appears in almost every contract management presentation, usually without a source and often in the wrong form. It is worth quoting properly, because it is real and it is stubborn: organisations lose a substantial share of the value of their contracts after signature.
The figure, and why it is not improving
IACCM research put average value erosion at 9.2% of anticipated contract value in 2014, with a range of 5 to 40% depending on circumstances. World Commerce & Contracting and Deloitte updated this in 2023: average erosion stands at 8.6%, with the best performers a little over 3% and the worst above 20%.
And there is the sharpest observation: in nearly a decade, during which heavy investment went into contract management software, the average improved by six tenths of a percentage point. The problem is not an absence of systems. The problem is that systems were filled and then not used. World Commerce & Contracting published a higher estimate of 11% post-signature leakage in February 2026; that is an estimate by an industry body together with a software vendor, so we mention it but lean on the measured 8.6%.
Where the process breaks
KPMG and World Commerce & Contracting surveyed more than three hundred organisations in 2021, focused on companies above half a billion in revenue. Almost 90% turned out to have fragmented and ineffective contracting processes; only 10.8% rated their end-to-end process as very effective. In the least efficient processes, reviewing and processing a single contract cost more than ten thousand dollars. Later research with Deloitte offered an explanation everyone recognises: in large organisations, contract-related data sits across an average of 24 different systems.
The consequences are predictable. Only 39% of commercial professionals believe contracts deliver their intended outcomes, 83% of executives find contracts too rigid to accommodate change, and 90% of business users find contracts difficult or impossible to understand. A contract nobody understands and nobody can find is not enforced — by either party.
The cancellation deadline is the real moment
Of all the places value leaks, one costs the most and gets the least attention: the notice period. Not the contract end date, but the date before which you must give notice for that end date to mean anything. In practice it falls thirty to ninety days earlier. Miss it and you no longer have a one-year contract but a two-year one — and from that moment you negotiate without an alternative.
This is not an edge case. An average organisation processes around 211 renewals a year, roughly one per working day. Without a calendar it is statistically inevitable that some slip through, and they are rarely the small ones.
The law will not help you here
A Dutch specific worth knowing: the Wet van Dam, which since December 2011 has restricted tacit renewal and capped the notice period after first renewal at one month, applies only to consumers. Businesses are excluded and fall back on the vendor's general terms. Courts sometimes extend protection to very small businesses or sole traders by analogy, but a mid-sized or large organisation has no statutory protection whatsoever against evergreen clauses and long notice periods.
It makes a neat mirror: as a private individual you are protected against exactly the construction you are fully exposed to as an organisation. Contractual discipline is the only defence.
The rhythm that solves it
What works is not complicated, but it has to be continuous. Start with a single register recording, per contract, the counterparty, end date, notice period and cancellation deadline, plus annual value and owner. Then segment, for example along the classic Kraljic axes of financial impact against supply risk. That determines how much attention a vendor gets — not every contract deserves a quarterly review, but your five critical suppliers deserve more than one a year.
Next, put cancellation deadlines in a calendar with alerts well in advance, so renewal becomes a decision rather than an event. For large strategic contracts we advise starting six to twelve months ahead; for routine SaaS, three to four months is conventional. And build a fixed quarterly rhythm reviewing performance, cost, risk and what is missing from the contract for each critical supplier. For some organisations that is now a requirement: DORA demands exit plans be periodically tested and reviewed, and Dutch central government cloud policy prescribes annual reassessment.
That rhythm is exactly what we deliver as a service. Not because it is difficult, but because it is continuous — and continuous work is always the first thing to slip. What you get in concrete terms is on the What you get page.