Contracting is a widespread activity, yet it is one that only a few businesses execute well. In fact, it’s been estimated that inefficient contracting costs businesses anywhere from 5% to 40% of the value of a deal, depending on the conditions. However, new technical advancements such as artificial intelligence (AI) are now assisting businesses in overcoming many contracting issues.
The biggest problem businesses confront when it comes to contracting is the vast amount of contracts they must keep track of; these contracts are often inconsistent and difficult to organize, maintain, and update. Because most companies don’t have a database of all the information in their contracts – let alone an effective means to extract it – there’s no easy way to evaluate complex outsourcing agreements or compare how a condition is worded across divisions. Not only does it take a lot of labor to create, execute, and improve contracts, it also takes a lot of manpower to draft, execute, and improve contracting processes and the transactions that these contracts regulate.
How AI is revolutionizing the concept of contract management
If a large tech company, for example, has a high volume of procurement contracts with various renewal dates and renegotiation terms, reviewing and tracking all of this information would take hundreds of hours and a staff of contract managers to ensure that no renewal or opportunity is missed.
AI software, on the other hand, can readily extract data and explain contract content. (Any number of contracts’ renewal dates and renegotiation clauses might be rapidly pulled and organized.) As a result, it can help businesses evaluate contracts faster, organize and locate vast amounts of contract data more readily, reduce the risk of contract disputes (and adversarial contract negotiations), and improve the number of contracts they can negotiate and sign.
Continue reading: https://analyticsindiamag.com/how-ai-is-revolutionising-contract-management/
The biggest problem businesses confront when it comes to contracting is the vast amount of contracts they must keep track of; these contracts are often inconsistent and difficult to organize, maintain, and update. Because most companies don’t have a database of all the information in their contracts – let alone an effective means to extract it – there’s no easy way to evaluate complex outsourcing agreements or compare how a condition is worded across divisions. Not only does it take a lot of labor to create, execute, and improve contracts, it also takes a lot of manpower to draft, execute, and improve contracting processes and the transactions that these contracts regulate.
How AI is revolutionizing the concept of contract management
If a large tech company, for example, has a high volume of procurement contracts with various renewal dates and renegotiation terms, reviewing and tracking all of this information would take hundreds of hours and a staff of contract managers to ensure that no renewal or opportunity is missed.
AI software, on the other hand, can readily extract data and explain contract content. (Any number of contracts’ renewal dates and renegotiation clauses might be rapidly pulled and organized.) As a result, it can help businesses evaluate contracts faster, organize and locate vast amounts of contract data more readily, reduce the risk of contract disputes (and adversarial contract negotiations), and improve the number of contracts they can negotiate and sign.
Continue reading: https://analyticsindiamag.com/how-ai-is-revolutionising-contract-management/
