The introduction of artificial intelligence (AI) has revolutionized the global marketplace and business landscape. AI will never replace the value and necessity of human thought and decision-making; however, AI should be welcomed into business practices due to how it can increase accuracy, efficiency, and standardization.
AI can increase the value of your contracts, dramatically streamline contract lifecycles, and boost the client and vendor/supplier experience. Rather than viewing AI as a threat on human jobs, we envision AI as a tool that can support organizational improvement, as it can free-up time spent by your legal team and other departments from working on low-level, repeatable tasks that AI can take care of instead.
Let’s explore how you can increase business efficiency with AI contract management.
Artificial Intelligence (AI) refers to computer operations and machinery that emulate human brain pathways and decision-making through both learning and observing surroundings in the framework of data sets. AI-based computers either learn through trial/error processes or by observing human activities. These learning mechanisms are known as unsupervised and supervised learning.
In unsupervised learning, a computer algorithm uses data analysis to execute tasks, generating additional algorithms based on testing. In supervised learning, humans give instructions and data to the AI. The AI then creates rules and determines patterns according to the data provided.
AI is employed in contract management to analyze and categorize current and future contracts. The AI might assess contract language according to the most consistently used phrasing when developing one contract type versus another in a given organization. AI can additionally be configured to identify, request, and reject changes in contract language. AI transforms the way that companies classify and store their contracts. With AI-based contract management software, you can offload several repeatable tasks.
Save you and your team from the headaches that come from subpar contract management. Cut down on turnaround times during reviews and approvals, reduce costs, and increase productivity by leveraging an AI contract management software solution. Take contract drafting for example. Even with preapproved, compliant contract templates, users must manually review each contract to ensure the content included fits the unique needs of the agreement at hand. This can cause delays, especially when multiple stakeholders are required for contract drafting and approval.
In traditional contract management, it can be difficult for legal to gain a holistic view of the status and performance of the company’s contracts. Because legal is required to oversee high volume contract portfolios, data analysis and extraction proves to be a trying, taxing process. Many legal teams keep contracts stored in a wide variety of places – from shared drives, to filing cabinets, to email inboxes… a complete lack of centralization. Due to the inconsistency in contract storage, you drive risk potential, the likelihood for contract loss, possibility of forgotten deadlines and auto renewals – all of which ultimately increase preventable costs. Contracts lay the groundwork for business partnerships, meaning poor contract management can result in significant financial repercussions and damages.
AI supports your legal team by digitizing contracts and defining rules for simplified contract categorization and data extraction, and this ultimately cuts down on costs and time spent for your clients. With machine learning, your computers can use accurate decision-making skills based on algorithms as they work through data sets. AI can additionally be trained to recognize contract types by sorting through contract-specific language and terminology. Machine learning is also excellent for identifying the contract type that is undergoing review, where the AI can offer recommendations for the contract’s content. For example, AI can provide suggestions based on past provisions used in your contracts with the same client or vendor.
Manage risk like a pro with AI-supported contract management software. In traditional contract management, an attorney is required to monitor all contract deadlines, milestones, deliverables, obligations, terms, and more throughout the lifespan of every contract. However, AI can support legal with notifications of upcoming key dates and smart data extraction to save time and take some stress off of your legal department’s back.
Artificial intelligence allows users to build contract expiry and auto renewal reminders. By offloading the responsibility of deadline tracking to a computer, you’ll save time and ensure that nothing slips through the cracks. This means more proactivity and awareness of time-sensitive obligations. Legal will have more leeway and time to assess contract risk according to each contract rather than having to sort through clauses in your agreements.
It’s necessary for legal to have the ability to plan ahead. AI supports this exact process. With AI, you can effectively work through and analyze broad data sets and develop predictions that are substantially more accurate than ones developed by the human brain. In the context of litigation, AI can be used to determine the likelihood of a successful outcome to help your lawyers make data-driven decisions and potentially save money.
Cut down on avoidable human errors during contract authoring and reviews by employing contract management software equipped with AI technology. Now, you won’t have to fret about mishaps in data entry when copying/pasting texts from templates into drafts or forgetting key sections of contract content. During the contract review process, legal takes a significant chunk of time identifying problematic clauses and risky contract language, ensuring section is proofread and error-free.
With AI, you’ll reduce costs associated with human errors during contract reviews. With AI, you can also create rules regarding exact clauses to automatically accept and reject. In this manner, the contract review phase becomes seamless, where the AI reviews it according to custom rules, alerting users of risky terms and clauses and notifying users where clauses may have been omitted.
AI contract management provides your internal legal department with all they need to successfully maintain a consistent and accurate contract portfolio. If your company wishes to use an exact term in every contract, then the AI can be configured to do so within every contract template.
Contract data extraction is simplified with AI contract management software, giving attorneys the opportunity to glean meaningful insights on contract terms. This makes maintenance of contract provisions and monitoring of dates easier than ever. Traditional contract management requires legal to track these data points, obligations, and key dates – a costly, time-consumptive, and risk-prone approach to contract management. However, AI contract management software can support your team with standardization in the tracking contract provisions, simplifying contract monitoring for legal and making it much easier to work through circumstances where noncompliance is present.
Leverage new AI capabilities in Dock’s Contract Management Software today so that you can increase the efficiency and organization of your contracting procedures for your legal team.
Our solution easily adapts to your Microsoft 365 environment, leveraging Teams and SharePoint for optimized communication and collaboration on all of your contracts. Leverage automated reminders to never forget about contract expiry and auto renewal dates, store contracts securely in a searchable, cloud-based SharePoint contract repository, and remove tension from your legal department with contract management made easy.
For more information, we would like to welcome you to schedule a free demo with us today.