Artificial intelligence (AI) is changing how we conduct our business in a multitude of ways. As AI systems become more complex, we are finding more ways that AI can streamline processes and improve efficiency across the board. Contract management has, for years, been a time-consuming and laborious process – but it doesn’t have to be! We’ve gathered some of the most impressive ways that both big businesses and small businesses can leverage AI-based contract management software in 2021.
1 – Using AI to improve efficiency
Nobody wants to spend their time trawling through contracts to check for due diligence. You’ve got more important things to be getting on with! Not only this, but it has been estimated that inefficient contracting causes firms to lose between 5% to 40% of their deals’ value. Performing an AI contract review eliminates the risk of human error while removing monotonous tasks from your workflow. Less monotony means that your talent can prioritize productive and profitable tasks.
2 – Search through thousands of contracts instantly
Many businesses will have thousands of contracts that, if we’re honest, might not have been organized as well as they could have been. This is no issue for AI contract management software, which uses a few simple keywords, or an entire paragraph, to produce what you’re looking for. The AI is designed to interpret your query and find exactly what you need in no time at all. Technology such as Imprima’s Smart Review functions straight out of the ‘box’; their AI performs the required tasks without the need for a (possibly lengthy) machine-learning process. It will categorize your documents, flag issues and identify similar search terms, all with minimal input from you.
3 – Transcend language restrictions
As AI systems function using pattern recognition techniques it is, as we call it, ‘language agnostic’. Not only can a good AI function in any language, but it can even identify key legal language in a variety of different document types.
4 – Methodically index your contracts
When conducting vendor due diligence, organization is paramount. AI-powered indexing can save you as much as 80-90% of the time that you would usually spend meticulously organizing your documents. Smart indexing works by learning from your established behavior. Basing its strategy on your desired standard index, the AI needs just one reference virtual data room. Once it has this, it will decide the categories of the documents uploaded and generate an intelligent folder structure.
Even if you don’t work with a standard index, a smart AI can be trained with an iterative structuring process. If you contribute a structure for less than 10-20% of your documents, your AI can do the rest by following in your footsteps.
5 – Automatic document summaries
Trawling through documents when looking for specific information is another time-consuming process that is prone to human error. AI can be tasked using key parameters, functioning to identify not only the relevant documents, but also highlighting predetermined aspects of those documents in moments.
Smart summaries work with any type of document. With its key parameters in hand, the AI will automatically fill in a summary based on the content. By then letting the AI know whether it has accurately summarized the contract, it will become even more accurate in the next summary that it produces.
An example of this process in action: you might want to create a searchable database or documentation. To do this, you task the AI with finding all documents with agreements that expire within X months. The software will automatically trawl and identify any contracts that fit these variables and identify summaries of each, allowing you to efficiently filter through and find exactly what you need. Nice.
6 – AI-led editorial process
Smart redaction negates the need to provide external providers access to confidential, sensitive data. AI can be trained to redact anything, from a single character to an entire document. This limits the need for expensive redactions processes and, as is the theme with AI, saves time. Not only this, but AI-led redactions processes help you to remain compliant with data protection laws.
Editorial processes can be intuitively adjusted to meet your needs. Intelligent automation can redact regular expressions such as email addresses or date-of-birth, or can be trained to redact based on your specific requirements.
7 – Keep your contracts consistent
Variation in contracts can prove damaging to a company in the long run. Ensuring that your teams are consistent in their contracting is made significantly easier with AI contract management software. AI has the ability to monitor contracts and automatically ensure that your phrasing and terminology is consistent through all of your contracts. This will reduce confusion across the board.
Not only this, but AI can perform risk analysis much faster than a team of humans can, acting to identify terms and clauses that are suboptimal and suggesting edits. This reduces the risk of human error when looking to draft new contracts or reviewing old ones.
How can AI contract management systems help my business?
As technology advances in any field, processes that are manual or repetitive are becoming increasingly automated. Understanding how and why AI is important is crucial in the ever-changing business world. In 2021, we will see more sophisticated applications of artificial intelligence and machine learning in every sector.
Using AI to supercharge your due diligence process can help you save up to 90% of your time that would normally be spent on manual contract reviews and data structuring.
Hi, My Name is Maria Wilson. I write about consumer credit for Techoko. I have been a speaker at FinCon, a national personal finance conference. My work has appeared in The New York Times, Washington Post, Los Angeles Times, MarketWatch, USA Today and MSN Money, and on the Associated Press wire. I am a serial mortgage financier. You can contact with me here at FB, Twitter or Email.