Contracts are essential for business operations because they serve a variety of purposes, including documenting agreements between parties, minimizing conflicts, mitigating risks, guaranteeing compliance, and, of course, earning revenue.
As a result, it’s surprising to learn that contract administration is such an inefficient procedure for many businesses. According to recent statistics, contract mishandling can cost businesses up to 9% of their annual revenue. Missed deadlines, regulatory compliance failures, and company decisions based on missing or inaccurate data can result from a failure to handle and interpret contracts properly.
The sheer quantity of complex contracts that many businesses must adhere to is the most significant logistical challenge.
An individual may find this task daunting, but it does not intimidate artificial intelligence (AI). This is why firms across industries are using AI for contract analysis. Contract analytics software helps companies boost their contracting productivity and efficiency.
What Is Contract Analytics and How Does It Work?
Contract analytics is the practice of examining and extracting data from an organization’s contracts in order to improve contract management. Transforming your legal papers, including legacy agreements and hard copies, into structured data and insight with contract analytics adds value, lowers risk, and enhances the productivity of legal operations teams.
What is Contract Analytics software, and what does it entail?
Contract analytics technology involves software that uses AI and Machine Learning to help firms analyze contracts more precisely and effectively.
How Can The Software Help Your Business?
Contract analytics helps firms enhance their business performance by allowing them to see risks, obligations, and opportunities in their contracts. It reveals the contract hotspots in greater detail.
Contract Analytics enables in-house counsels and legal operations to monitor hundreds of thousands of contracts and agreements in your organization to guarantee that no commitments, service level agreement measurements, or other liabilities are being hidden to put your firm in danger.
It allows you to respond swiftly and efficiently to an audit request or an organizational change by offering quick and easy access to your contractual provisions data.
- Risk Management
Contract analytics software looks for risky clauses, text, or data in the CLM repository. Due to shifting regulatory compliances in an unpredictable economy, it is important to identify contracts with suppliers in high-risk zones. It guarantees that contracts are enforced and operated in accordance with the most recent terms, conditions, controls, and policies.
- Finance Management
The software also assists in the reduction of legal fees, the elimination of unnecessary service renewals, and the identification of untapped revenue sources. It also assures cost-effective contract management by providing total expenditure visibility, a high-value feature.
- Improves Business Effectiveness
Contract analytics improves corporate performance by making risks, obligations, and opportunities in contracts more visible. Its powerful artificial intelligence (AI) solutions assist in spotting patterns and possibilities for performance improvement, cost recovery, cost savings, and loss mitigation.
- Productivity and Operational Efficiency
The system keeps track of crucial information like dates and provides automated reminders and tools for users to schedule notifications as needed. It is possible to gain more control and efficiency by removing manual processes and centralizing the document repository.