Smarter about contracts
The importance of effective contract management is increasing as transactions and contracts become more complex and multi-jurisdictional. Legal departments with growing workloads need to make contract drafting and approval scalable and replicable. Contract lifecycle management (CLM) is a software-based, end-to-end solution for handling, tracking, and automating the creation, negotiation, execution, and monitoring of all the contracts a legal department handles, with data analysis powered by artificial intelligence (AI). CLM complements lawyers’ expertise and adds value to legal departments by controlling all aspects of the contract management process in one place, creating a central repository and a single source of truth.
55%Corporate legal departments using CLM systems in 2021
44%Corporate legal departments using CLM systems in 2018
65%Legal departments which saw matter volumes increase in 2022, often with no increase in budget
Intelligent CLM: Where legal departments are headed?
There are three main stages of CLM adoption:
- CLM as a system of record
- CLM as a system of engagement
- CLM as a system of intelligence
Legal departments are moving from using CLM solutions simply to track and store contracts, to using them to assist and automate workflows, and then by deploying AI, to evaluate contracts, leverage data, and analyse risk to drive business decisions.
How does AI complement and enhance CLM?
AI-enabled CLM allows legal departments to tackle their central problem in contract management: lack of insight into contracts’ contents.
What can legal departments accomplish with AI-enabled CLM?
AI surfaces the important elements of contracts, enables deviation analysis, speeds up document review by searching entire document portfolios, generates reports, and allows for greater visibility into a business’s overall contract workflow.
It helps make manual, time-consuming processes efficient and streamlined, and enables CLM tools to adapt to legal department needs.
By working faster, automating workflows, eliminating bottlenecks, and increasing visibility, legal departments can become more proactive about contract management, think more strategically about priorities and risks, and make decisions that can positively affect business outcomes.
As such, the software becomes a force multiplier — allowing lawyers to apply their expertise more effectively and efficiently where and when it is needed, and enabling legal teams to transform themselves from a cost centre into a value driver within the business.
What are the business benefits of AI-enabled CLM?
AI-enabled CLM does more than just make lawyers’ lives easier — it has the capabilities to help businesses understand their contractual obligations, accomplish more with less employee effort, ensure uniform and risk-reduced contracts, and enhance strategic decision-making.
By supporting new levels of insight into vast troves of contract documents, facilitating data analysis and creating more consistent contracts, lawyers can close deals faster and companies can secure revenue streams they might otherwise miss out on due to lack of visibility over issues like contract renewals.
AI-powered CLM solutions can also give senior executives the information they need to make informed high-level decisions by unearthing key data hidden in these documents and answering any questions they may have quickly.
Learn more about AI-powered CLM solutions from Thomson Reuters
Today’s ideal CLM solutions have an AI component that is developed by both data science and legal experts to give legal departments a contract management tool that’s ready to meet their specific needs.
Read our intelligent CLM white paper or find out more about our AI-powered CLM solution, which is trained by expert Practical Law editors.
See how Contract Lifecycle Management can help your business