Contract Management Best Practices: Contract Backlogs
The traditional legal-team response to a backlog of uncatalogued and unanalyzed legal agreements has been to throw people at the problem. This is all fine and good if you're in private practice and want to rack up some billable hours for a client, but for in-house counsel, there needs to be a better response to a contract backlog than "a truckload of interns."
Fortunately, artificial intelligence has made managing a massive contract portfolio a task that doesn't necessarily require a small army of legal professionals. Modern AI can actually read contracts and can do it faster and more accurately than even a hundred of your most talented interns.
Now, when we say that AI software can "read contracts," we don't mean crude keyword-matching. A paragraph that contains the phrase "hold harmless" may not actually be the section of a contract that spells out the particulars of a hold harmless clause.
Natural language processing (NLP) technology can parse and analyze entire sentences, paragraphs, and pages to understand their content and context. Using modern NLP, artificial intelligence software can break down a legal agreement into its relevant clauses and generally identify problematic language in each section of a document.
More simply, AI can now redline a contract at software scale and speed, so you don't have to force your legal team to mark up your contracts one document at a time.
To be clear, AI is not quite ready to alter contract language without human supervision, but it can absolutely help you sort through which agreements need review and revision, and which documents conform to your boilerplate language and established policies. With modern AI, you can find out quickly which contracts need your immediate attention.
And this functionality goes beyond flagging problematic language to identifying actionable contract obligations and opportunities. If you need to simply sort your client contracts into those that renew automatically and those that must be purposefully renewed, AI can do that. If you need to know where agreed-upon prices escalate or are recalculated, AI can find those agreements. If you need to know which agreements fall into which jurisdictions or apply to specific parties, AI can make those distinctions, too.
Artificial intelligence can't manage your contracts for you, but it can tell you which contracts needs to be managed, when, why, and even how. And AI can help your legal team focus on these critical, valuable aspects of legal counsel, rather than get stuck in the drudge work of marking up and classifying contracts. LinkSquares is building the AI contract management solution of the future today. If you're ready to start analyzing your contract backlog at the speed of software – and find better uses for your truckload of interns – contact LinkSquares today.
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