Getting a contract approved shouldn’t take forever—but on average, it does. Studies show that contract approvals take around 3.4 weeks, and that’s just one part of the process. Factor in drafting, negotiations, and revisions, and it’s easy to see why contracts can drag on for months.

That’s why more businesses are turning to automation and contract management tools to cut approval times and reduce the back-and-forth. A contract approval workflow helps keep things organized. As a result, your contracts move through each stage quickly and efficiently.

In this guide, we’ll walk through how to build a workflow that eliminates delays, reduces errors, and speeds up approvals—so you can close deals faster and with less hassle.

What Is a Contract Approval Workflow?

If you’re handling contract approvals manually, you know how messy it can get. You draft a contract, email it to the right people, and then… you wait.

Maybe someone forgets to check their inbox. Maybe legal has a few edits but doesn’t loop in the right people. Maybe the finance team wants changes, but the contract is already sitting with leadership for approval.

Before you know it, the contract is bouncing back and forth, getting lost in email threads, and taking weeks—sometimes months—to get finalized.

A contract approval workflow puts structure in place to avoid all that chaos. It defines who needs to review, approve, and sign off so contracts move smoothly through each stage.

With a proper workflow, you’re not constantly chasing approvals or wondering who’s holding things up. Everything is tracked and organized, and if you set it up right, much faster.

Who’s Involved in the Contract Approval Process?

Several people and teams are involved in a contract approval workflow, each with a specific role. The exact people depend on the company and contract type, but here’s who typically plays a part:

• Legal counsel: Reviews contracts to catch compliance issues, reduce legal risk, and make sure all terms align with regulations.
• Finance team: Checks pricing, payment schedules, and financial implications so the contract makes sense from a budget and revenue standpoint.
• Department heads: Ensure contract terms support business goals and operational needs before giving approval.
• Procurement team: Manages vendor agreements, negotiates terms with suppliers, and ensures contracts meet internal policies.
• Sales team: Handles client contracts, ensuring that pricing, service terms, and deliverables match the agreed deal.
• Executives: Provide final approval on high-value or strategic contracts, especially those that involve significant risk or long-term commitments.
• Contract managers: Oversee the entire process, track approvals, coordinate with different teams, and maintain records to keep everything organized.

Having a clear workflow makes it easier to know who needs to approve what, which helps prevent unnecessary delays and last-minute confusion.

Why Do You Need a Contract Approval Workflow?

Without a structured workflow, contracts can get stuck in email threads, waiting for someone’s approval. A defined process keeps things moving so deals don’t get held up. Here are the benefits you can expect when you set up your own:

Reduces Errors and Risks

Mistakes in contracts can cost you—big time. A small oversight could lead to legal headaches, financial losses, or messy disputes. Without a proper approval process, contracts might slip through without a second look and leave you exposed to risks.

On the flip side, a structured workflow makes sure every contract gets checked by the right people. Legal spots compliance issues, finance reviews payment terms, and department heads confirm everything aligns with business goals. 

Instead of scrambling to fix problems later, you catch them early.

Improves Accountability

Ever had a contract get stuck in limbo, with no one taking responsibility? That’s what happens without a clear approval process. People forget, emails get buried, and when something goes wrong, everyone points fingers.

A structured workflow keeps things clear. It assigns roles, tracks approvals, and makes sure no contract moves forward without the right sign-offs. If a problem pops up later, you know exactly who approved what.

Keeps Everything Organized

Lost contracts, endless email chains, and outdated versions—sound familiar? Without a structured approval workflow, tracking contracts is a nightmare. Where’s the latest draft? Has legal signed off? Who’s holding things up?

A good workflow puts everything in one place, so you’re not digging through emails or chasing people down. Every step is tracked, approvals are documented, and you always know where a contract stands. No more chaos, no more wasted time.

Saves Time and Resources

Waiting for approvals shouldn’t feel like watching paint dry. But when contracts get stuck in inboxes, that’s exactly what happens. You send it, you wait… and then you follow up. Again. A structured workflow speeds things up by automating reminders and setting clear deadlines.

The faster contracts get signed, the sooner deals close, and the business moves forward. Instead of wasting time chasing approvals, you focus on what actually matters.

How to Set Up An Efficient Contract Approval Process

Setting up a contract approval process doesn’t have to be complicated. The goal is to keep things moving without delays, confusion, or endless back-and-forth emails. A solid workflow makes sure the right people review contracts at the right time so nothing slips through the cracks.

Here’s how to build a system that’s clear, efficient, and easy to follow.

1. Figure Out Your What Your Bottlenecks Are

If contracts keep getting stuck, something’s slowing things down.

Maybe approvals sit in someone’s inbox for too long, or there’s confusion about who needs to sign off. Sometimes, too many people are involved, making the process more complicated than it needs to be.

To start, take a step back and pinpoint where delays happen most often. Are contracts bouncing between teams? Is legal taking too long? Are there too many revisions?

Identifying these roadblocks is the first step to fixing them. Once you know what’s causing the holdup, you can make changes that keep things moving faster.

2. Create Your Specific Playbook

A contract approval workflow works best when it’s clear and structured. Instead of relying on scattered emails and verbal approvals, create a detailed playbook that outlines every step. This ensures everyone knows their role and contracts don’t get stuck in unnecessary back-and-forth.

Here’s what to include:

• Approval stages: Define the steps a contract or contract request goes through, from drafting to final sign-off.
• Who’s responsible: List who needs to review and approve contracts at each stage (legal, finance, department heads, executives, etc.).
• Approval thresholds: Decide if all contracts require executive approval or only those above a certain value.
• Standard timelines: Set expected review and approval times to prevent delays.
• Revision guidelines: Outline how feedback should be given and when a contract needs to go back for edits.
• Handling urgent contracts: Have a plan for fast-tracking critical agreements.
• Tracking and storage: Specify how approved contracts are stored and who has access.

A solid playbook removes confusion, reduces approval time, and keeps things running smoothly. Keep it simple but detailed enough so that no one is left guessing what to do next.

3. Draft A Contract Approval Process

Once you’ve identified bottlenecks and built your playbook, it’s time to map out your contract process.

A clear, step-by-step structure helps make sure contracts move through approvals without unnecessary delays. Here’s a solid framework to follow:

1. Draft the contract: The legal or business team creates the first version based on standard templates or custom terms.
2. Initial review: Internal stakeholders—such as department heads or finance—check for alignment with business goals and budgets.
3. Legal review: The legal team examines the contract for compliance, risk, and necessary revisions.
4. Final approvals: Executives or senior decision-makers review and approve contracts that exceed predefined thresholds.
5. Signatures and execution: Once approved, contracts move to the final signing stage with electronic or manual signatures.
6. Storage and tracking: Signed contracts are stored in a centralized system, making them easy to access for future reference.

A structured process helps make sure every contract gets the right level of scrutiny without unnecessary back-and-forth.

It's best to make it flexible for urgent contracts but firm enough to maintain accountability. The goal is to move contracts through efficiently while keeping everything organized and compliant.

4. Automate Where You Can

Chasing signatures, sorting through old versions, and waiting on approvals can slow everything down. The good news? You don’t have to do it all by hand. A little automation can speed things up and take the stress out of the process.

Consider these strategies to make your life easier:

Use Electronic Signatures

Still waiting for people to print, sign, scan, and email contracts back? That’s a huge waste of time. Electronic signatures let people sign instantly from anywhere, cutting out unnecessary delays.

Plus, you get a clear audit trail, so you always know who signed what and when.

Compile Pre-Approved Templates

If you’re rewriting the same type of contract over and over, stop. Pre-approved templates save time, keep things consistent, and make sure nothing important gets left out. 

Just fill in the details and send it out—no need to start from scratch every time.

Create a Contract Repository

Without a proper system, you risk using the wrong version, missing key details, or losing important documents altogether. A contract repository keeps everything in one place, so it's easy to track, access, and manage contracts.

But simply having a storage system isn’t enough—it needs to be well-organized. Here’s what should be included:

• Finalized contracts: Store signed agreements so they’re always easy to find.
• Previous versions: Keep track of past drafts for reference in case disputes or questions arise.
• Approval history: Log who approved the contract and when to ensure accountability.
• Key dates and renewal info: Track expiration dates, renewal deadlines, and termination clauses to avoid missed opportunities.
• Supporting documents: Store related files like proposals, invoices, and compliance documents.
• Access controls: Set permissions so only authorized users can view or edit contracts.

Use a Contract Redlining Tool

When multiple people review a document over email, things get messy—changes get lost, conflicting edits create confusion, and no one’s sure which version is the right one.

A contract redlining tool makes this process smoother by keeping track of edits in real time. Instead of juggling multiple versions, everyone works on the same document, with changes highlighted and comments visible to all reviewers.

Contract automation software also speeds up negotiations by centralizing discussions. Instead of long email threads, stakeholders can suggest edits, approve changes, and finalize terms in one place.

Some contract management platforms, like Aline, use AI to optimize contract workflows, making redlining and approvals even more efficient. Integrating a tool like this cuts down on wasted time and reduces errors, so contracts move through the pipeline faster.

5. Integrate Contract Approval Software

Manual contract management is frustrating. Emails pile up, approvals take forever, and tracking who needs to sign off next feels like a guessing game.

Aline, a contract lifecycle management (CLM) tool, takes the hassle out of the process by automating workflows from start to finish.

With Aline Workflows, contracts follow a structured approval path based on predefined rules. Smart routing ensures the right stakeholders review and approve documents in the correct order, while dynamic approvals automatically adjust based on contract details.

For example, if a deal exceeds a certain value, Aline can trigger an extra approval step—no manual intervention needed.

The platform also provides transparent tracking, so you always know where a contract stands. Notifications keep everyone in the loop, preventing delays, and compliance safeguards ensure every document follows company policies.

Need signatures? Aline automates that, too, eliminating the back-and-forth.

Instead of chasing approvals, your team can focus on closing deals. Start a trial to see Aline in action!

6. Use Smart Delegations

Not every contract needs to land on an executive’s desk. If every approval has to go through the same long process, things will slow down fast. 

Smart delegations make sure the right people handle the right contracts so approvals don’t get stuck waiting for someone who’s too busy to review them.

• Set approval limits so managers can sign off on smaller contracts while bigger deals go up the chain.
• Delegate routine approvals instead of pushing every contract through senior leadership. If it’s low risk, let department heads handle it.
• Escalate only when necessary by automatically routing high-value or complex contracts to legal or executives.
• Assign backup approvers so contracts don’t stall when someone’s out of office.
• Keep a clear approval trail so there’s always a record of who signed off and when.

This way, approvals move quickly without cutting corners. Contracts get signed on time, and the right people stay focused on the deals that actually need their attention.

Enjoy The Benefits of an Automated Contract Approval Workflow

Ever feel like contract approvals take way longer than they should? If you’re tired of chasing signatures, dealing with unclear approval chains, or wondering where a contract stands, it’s time to rethink your process.

A structured workflow eliminates delays, reduces errors, and keeps everything organized—so contracts move through approvals quickly and efficiently.

With automation, smart routing, and clear delegations, your team spends less time managing paperwork and more time closing deals. 

Aline takes it a step further by giving you full visibility, automated approvals, and compliance safeguards—all in one easy-to-use contract management software.

Start your trial today and see Aline's full potential!

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FAQs About Contract Approval Workflow

What are the steps of the contract approval process?

A standard contract approval process includes drafting, contract review, internal approvals, legal checks, final sign-off, and execution. In a manual contract approval process, this can take weeks due to back-and-forth emails and unclear responsibilities. Automating these steps helps speed things up and ensures nothing falls through the cracks.

What is the workflow for the approval process?

A contract approval workflow outlines the steps a contract follows from creation to final approval. It includes assigning the right stakeholders, setting approval conditions, and tracking progress. Businesses that manage contract approvals with automation tools benefit from faster approvals, fewer errors, and better compliance tracking.

What is the process of contractor approval?

Approving a contractor typically involves verifying credentials, reviewing past work, and negotiating contract terms before finalizing the agreement. If a company uses the same contract template for multiple contractors, a structured workflow ensures that approvals stay consistent and compliant with internal business processes.

What are the steps of the approval process?

The approval process varies by organization but usually follows a set path: contract creation, stakeholder review, legal and financial checks, final authorization, and execution. A structured workflow helps streamline each stage, preventing unnecessary delays and making contract review more efficient.