What is contract intelligence?
What is contract intelligence, we hear you ask?
Is it the same thing as contract management or something else?
Let’s explore what contract intelligence is, its benefits, and why you should use it in your business.
What is a contract intelligence platform?
Contract intelligence platforms are the next evolution in contract lifecycle management (CLM).
They use machine learning algorithms and artificial intelligence to generate contracts.
In 2023, many businesses use a contract management system to streamline the contracting process.
But the concept of a contract intelligence platform is relatively new.
Traditional contract management platforms focus on establishing ways to digitize and centralize information. The goal is to implement a standardized process for creating legal documents.
An AI-powered contract intelligence platform goes one step further. It generates advanced analytics that inform the contract creation process in a number of important ways.
- Structure new contracts intelligently according to smart learning algorithms.
- Continuously track all your contracts and automatically flag compliance issues.
- Generate real-time insights from your ever-growing contract portfolio. This can help maximize the efficiency of your onboarding and procurement processes.
- Integrate with your other critical business systems such as ERP and CRM tools and link information about legal obligations dynamically.
- Benchmark key metrics to streamline your workflows and generate actionable insights.
Benefits of a contract intelligence platform
Let’s now investigate the advantages of using a contract intelligence solution for contract management:
One of the first things you’ll notice when you start using contract intelligence software is how much faster everything is.
That doesn’t just apply to the contract workflow itself, either.
Yes, it means that contracts are finalized more quickly.
Smart automation reduces the contract review time required from your legal team.
That helps supercharge your onboarding process. But it makes other processes quicker, too.
The integration of your contract data with other operational systems streamlines your workflows, so you arrive at the right business decisions much faster than before.
The benefits of contract intelligence platforms don’t stop there.
One of the problems with traditional contract management software is it doesn’t always scale well as your business grows.
That’s because it still relies to an extent on manual processes, so needs a lot of human input.
On the other hand, intelligent contracts don’t need much intervention, making the process easier to scale.
The contract intelligence platform generates automated alerts, intuitive dashboards, and detailed audit trails. Your team can use these to respond as required.
In this way, a small legal team can curate and manage thousands of contracts with no risk of getting overwhelmed.
The best contract management software helps you create legally compliant static contracts.
What it won’t do is optimize the efficiency of many of your other processes.
The continuous contract analysis performed by contract intelligence platforms, on the other hand, drives enhanced performance elsewhere.
It makes for much easier collaboration between teams, and the more sophisticated integrations it offers simplify your workflows.
Its ability to leverage end-to-end data analytics is good news for stakeholders in your organization, as it simplifies the complex task of data extraction, freeing them up to focus on other vital work.
When it comes to issues around customer management, supplier relationships, and pricing transparency, it’s obvious why contracts are important. Accountability and visibility are critical.
Contract intelligence software adds immediate visibility to the mix.
It can generate advanced analytics and track important metrics, delivering crucial information.
This gives you a genuine advantage in a fast-moving market.
The software will immediately flag any potential problems before there’s any danger of them turning into a crisis.
It can also alert you to new opportunities you might not have discovered otherwise.
What kind of documents can contract intelligence handle?
Contract intelligence comes into its own with AI-driven contract analysis.
This makes it particularly valuable when handling more complex contracts. The contract analysis process involves a number of critical tasks.
These include verification of terms and conditions, compliance management, and corporate risk assessment (not forgetting the examination of the contract language to eradicate ambiguities).
Machine learning algorithms that contract intelligence platforms use are excellent at handling structural complexity.
Contracts usually use legalese rather than natural language.
This isn’t a problem for contract intelligence software, making it suitable for use with all sorts of contract types, including:
- General employment contracts. You can use contract intelligence to improve your onboarding process.
- Supplier agreements. Optimize and simplify your procurement procedures.
- Indemnity agreements. Protect against the risk of loss from liability.
- Partnership contracts. Create watertight partnership agreements as a solid foundation for future success.
- Non-disclosure agreements. Ensure confidentiality in your business transactions.
Contract automation vs. contract intelligence
So, what are the differences between contract intelligence and the kind of contract automation you get with contract management software?
Firstly, contract intelligence offers full AI-driven smart structuring and rearranging of contracts.
This isn’t possible with traditional contract automation, which relies on standardized templates.
Traditional methods focus purely on the centralization and digitization of contract-related data.
Meanwhile, going the contract intelligence route means effective data integration with existing systems. That can unleash important insights.
When it comes to how the two systems respond to ongoing changes, there’s no contest.
Contract intelligence platforms manage change throughout the contract life cycle, whereas basic contract automation is more about the creation of the contract in the first place.
Traditional contract management platforms aren’t great at updating agreements for compliance purposes as the market environment changes either, but that’s a key strength of contract intelligence.
Dynamic contract analysis with contract intelligence
So, one final time: What is contract intelligence?
The truth is, it’s the next step forward in CLM technology, and you should consider getting on board.
The beauty of contract intelligence software is it works with your existing systems to unleash collaborative potential.
Your contract portfolio can now become an additional strategic resource in your business arsenal. Best of all, you can rest assured that every single contract you have is watertight.