Corporate legal departments are relatively slow adopters of new technology. However, the sudden onset of the COVID-19 pandemic forced businesses to pivot in order to survive. 

After surveying 1,000 senior executives in America, the 2020 RELX Emerging Tech Executive Report found that 68% had increased investment in Artificial Intelligence (AI) technology in response to the pandemic. Of these, 48% purchased new AI solutions while 46% increased investment in AI tech they already owned. 

Companies use legal AI to accelerate clause searches, extractions, contract comparisons, redlining, and tracking. More advanced solutions can identify risks and standard position deviations while applying contextual reasoning to offer suggestions. These capabilities allow corporate legal departments to cut costs while enabling staff to concentrate on higher-value, strategic tasks. 

By leaning on AI, in-house counsel can identify patterns in the data contained in contracts that would, in turn, allow them to draft documents more effectively, verify important contractual details, and pursue strategic positions that are more likely to be approved.

Examples Illustrating How AI and Contracts Work Together

Countless real-world examples illustrate how AI complements the contracting process, helps corporate legal teams maximize efficiency, and better manage contract renewals and renegotiations. 

• An aviation company turned to DocuSign because it wanted to divest an entity and restructure under a new one. The process entailed a review of more than 20,000 agreements to determine if notice or permission from counterparties were required in order to take action. The company also wanted to know whether counterparties would have the right to terminate agreements. In the past, the company would have had to manually review all 20,000 documents and answer 20 questions for each agreement. Today, it can leverage AI to cull relevant documents down to 3,500 and automate assessment. In just five days, the aviation company received the answers necessary to execute its legal strategy.
  
  
• A Netherlands-based data company knew it was sitting on a treasure trove of information stored in paper format. They used an AI tool to digitize and store 70,000 legacy contracts over four months’ time. The information gave employees the ability to extract and examine clauses at scale to identify patterns. Ultimately, they would be able to make more proactive decisions about renewals, upsells, and cross-sells, which in turn would increase revenue. Automated contract analysis enabled the company to unlock contract value and accelerate contract turnaround time.
  
  
• A global accounting firm needed to execute 1,400 NDAs. The contract volume and the pace at which the business needed to move would have overwhelmed the legal team. With 30-40% anticipated annual growth in NDAs, they knew their largely manual process had to be modernized. After applying LexCheck’s technology at key pain points, they reduced contact review times by more than 50%, saving 800 hours. 

These examples clearly show that AI is a highly effective solution for contracting excellence that can free up resources through automation, allowing companies to be more effective.

Tips for Successfully Infusing AI Into Existing Contract Workflows

If you're having trouble getting started or don’t know where to look, here are a few tips for implementing AI into your contract workflows:

• The first step to implementing contract AI is understanding where support is needed most. Some organizations may have trouble locating documents or retrieving information—in which case a cloud repository is a logical first step.
  
  
• When the drafting process is slow, integrating software that includes templates as well as a drag-and-drop corporate legal playbook builder can help insert boilerplate language faster and let drafters know where to focus the majority of their time and effort.
  
  
• For most companies, contracting bottlenecks arise during the review and negotiation stages. With fully integrated software, however, reviewers can upload a contract into the system of their choice, which is then fully redlined in minutes.
  
  
• Additionally, companies can utilize legal AI tools for e-signatures to close deals faster and post-execution analytics to assess total time-to-execution and other metrics that may help the organization strategically.   
  
  
• Technology onboarding is a crucial yet often overlooked aspect of legal strategy. Finding a good tech partner who offers substantial onboarding support is necessary for  successfully infusing AI into existing contract workflows. 

Complete Your Legal Strategy with LexCheck Automation

LexCheck’s cutting-edge contract review and negotiation tech seamlessly integrates with your workflow to review and negotiate agreements quickly and effectively. Uploading a draft to the system is as easy as sending an email. The draft can be returned fully redlined in less than five minutes, color-coded based on associated risks, and/or marked up with intelligent, AI-guided suggestions that can be applied with the click of a button. If your legal strategy is missing an automated contract review and negotiation solution, look no further than LexCheck.