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Contract intelligence is helping legal professionals focus on the needle-moving tasks for their organization. These include tracking contract obligations, opportunities, and risks and reducing the risk of corporate liability.
However, implementing an AI solution for contract management is challenging. The choice of software and the way it’s used is critical.
Automated Data Extraction
When reviewing incoming contracts, many companies need help with the massive amount of unstructured information received in faxes, scanned documents, and other non-interfaced data. Extract automatically filters this data, capturing only the relevant information. This helps reduce review time and the number of errors caused by manual review.
This information can then be fed into downstream systems, automating functions like contract amendments, compliance checks, and e-signature integration. This feature is still moderate in maturity, but it is expected to grow rapidly in value.
Additionally, a document AI platform can automatically classify, sort, and cluster clauses. This allows contract professionals to easily compare different contract versions and highlight changes in the audit trail. This is especially helpful when negotiating with multiple parties.
Using advanced machine learning, contract intelligence tools can help you automate rote and standardized agreements to make them easier to understand. This helps reduce the time required to complete contracts — and even allows you to spot issues that could impact your business, such as potential regulatory errors or non-compliance risks.
Structural complexity is another area where AI tools come into their own. ML tools can quickly scan through contracts for terms, elements, clauses, and more, helping to ensure that everything gets noticed during a review process.
This is especially useful during compliance reviews when the company needs to sift through all agreements for mismatches with updated regulations or compliance rules. The result is that contracts are reviewed and ready for compliance much faster — saving your team significant time.
As regulations continue to change around the globe, firms need to review their contract terms and agreements regularly. This can be a time-consuming process, however.
AI technology enables contract analysis to be performed more quickly and efficiently than manual processes. This can free up talent to focus on more value-add tasks and increase organizational efficiency.
Artificial intelligence software uses natural language processing to recognize automatically and tag contracts and related documents, making them easier to find in a searchable database. This also helps streamline contract review, improving document visibility and reducing payment turnaround times. It can also help with contract management by identifying risks, opportunities, and other key information in contractual data sets. This information can then improve performance, compliance, and obligation management.
Automating contract management processes eliminates human error, decreases costs, and saves valuable time. Companies must identify workflows that are good candidates for automation to make this possible. This involves identifying repetitive process steps that are prone to errors and time-consuming to do manually.
For example, a company might have a lot of contracts containing similar clauses. It could use a contract intelligence tool to auto-tag these contracts with relevant terms and phrases to save time and effort.
Additionally, contract intelligence tools can automatically sift through contracts and highlight any changes made in the audit trail. This helps to communicate important regulatory and compliance information to all stakeholders. It also reduces the time spent on manual management tasks and enables employees to focus on high-value work.
Using AI tools, organizations process massive amounts of paper documents that would otherwise require a sizable workforce and be subject to human errors. This is done with the help of Natural Language Processing and machine learning to automate document data analysis and extract relevant information.
For example, a smart document scanner and capturing service can recognize the text within scanned images to identify the document, whether it’s a patient record, MRI report, reference letter, or something else. This saves valuable human resources and enhances operational effectiveness.
Additionally, AI-powered contract intelligence platforms can automatically sift through all contracts to detect any areas of regulatory mismatch. This helps ensure compliance and avoid penalties. It also eliminates the need for manual sifting through contracts and allows legal teams to focus on more important contract management tasks.