Nearly all rapidly growing companies employ small legal teams beavering away behind the scenes on all sorts of paperwork transactions, especially contracts.
While their legal staffs are small, their influence is gigantic across the enterprise and they play a vital role in regulating the money that flows through the business.
But 65% of legal professionals in the firms surveyed by Apttus, a software company, say their biggest headache is the time lost on locating, reviewing and analyzing paper documents.
As a result, the surveyOpens a new window by the business-to-business provider said, 40% of legal departments now use automation tools to deal with their paperwork loads and 29% are considering them.
It’s About Time
Legal professionals takeOpens a new window between 20 and 30 days to create, negotiate and finalize a contract. Without an automated system, contracts management spreads across a range of computing platforms such as Excel and Word as well as email exchanges and person-to-person phone contacts, with inefficiency and risk of error growing at every stage.
Legal staffers also face time pressures from other departments and deal with antiquated filing systems loaded with documents that seem to hide data from a quick review. As a result, you have a segment ripe for disruption and change.
While the momentum to automate back-office workplaces is growing, nearly half of legal teams surveyed say the main barriers to streamlining their processes are small budgets and a lack of personnel.
Companies experiencing rapid growth often lack the personnel to track each line of every contract, service agreement or legal document before it’s executed. Even in the most carefully reviewed agreements, some information is forgotten as soon as the contract is signed.
Once the business has matured and due diligence projects arise for example, when a law changes or an acquisition takes place companies must conduct detailed reviews of all signed contracts and identify specific terms within them.
New tech and AI
Several software companies are trying to step into the space with new technologies driven by artificial intelligence. For instance, one is a Boston start-up called LinkSquaresOpens a new window . It sells a suite of automation tools to complete what the company calls fast and systematic legal reviews of executed business agreements.
LinkSquares says its cloud-based tools help relieve enterprise legal teams from the burden of manually and inefficiently reviewing contracts and eliminate many steps in the process.
Whether legal professionals and company executives are preparing for an audit, reviewing agreements for a merger or engaged in crisis management, LinkSquares’ claims its cloud-based solutions help them make quick and accurate decisions and provides them with useful insights.
The company’s AI-powered contract repository automatically finds and extracts key terms and metadata and provides deep search, custom reporting and analytics.
Its “Smart Values†dataset, using 30 commercial terms, extracts data from contracts, such as termination dates, auto renewal, payment terms, limitation and liability, amounting to five million data points extracted over the past five years, the company says. It currently manages more than half a million contracts across hundreds of customers, including FitBit, Twilio, Asurion, and VMWare.
Dynamic, Growing Market
Overall, the contract management software market is predicted to grow from $1.5 billion in 2019 to $2.9 billion by 2024. It’s a dynamic sector.
Just over a week ago, DocuSign, the electronic signature company, announced it was buying Seal Software, which also develops AI-powered contract discovery and management solutions, for $188 million.
“With the acquisition, DocuSign has firmly made a bet on artificial intelligence as the future of agreements and will now integrate Seal’s technology, which makes finding, analyzing and extracting data from contracts simpler and faster, more comprehensively across the [DocuSign] Agreement Cloud,†a company statement said.
Other tech companies in the sector include Evisort and Concord, which offers digital contract visualization and collaboration tools. And Seattle-based IcertisOpens a new window provides a cloud-hosted management suite via Microsoft Azure to several enterprise clients including Adobe, Boeing, Daimler and Microsoft.