How corporate legal is using AI for contract analysis
Balancing the need for speed with resource and risk management
Guest Blog Contributed by Jim Wagner, DocuSign VP of Strategy, for the DocuSign Agreement Cloud
Today’s corporate counsel face extraordinary demands—manage internal and third-party risk effectively across a myriad of complex commercial contracts, control internal headcount, spend less on expensive outside counsel, close deals with key customers and suppliers…and do it all faster. In fact, a recent Gartner study* highlighted that the number one ask of the legal department by other members of executive management is to increase speed, which often appears to diverge with the parallel mandates to control headcount and manage risk.
Working through these competing priorities clearly generates a degree of complexity, and at times outright conflict; but there is a viable solution, and it’s one that progressive general counsel and leaders like UnitedLex are making a reality.
There are three keys to effectively managing this challenging paradigm:
1. Leverage AI Technology
There has been a significant upswing in the availability of leading-edge technology solutions to help the GC and the legal department in every aspect of their function, from billing, to matter management to contract negotiation and management. One of the most impactful technologies at the GC’s disposal today is artificial intelligence (AI) for the analysis of contracts, which is fundamentally changing the efficiency and effectiveness of corporate legal functions up and down the land.
A good example of this AI technology is Seal Now™, Seal’s application for the analysis, risk rating and negotiation of complex commercial agreements, available directly in Microsoft Word. Contract negotiators understand that the review of a draft agreement that is not based on their templates takes an extraordinary amount of time to complete and also is most likely to introduce unidentified and unquantified risk. Leveraging AI, such as Seal Now, to analyze “unfamiliar” drafts both substantially reduces the amount of time required for attorney review, but also assists with a rapid determination of the risk attendant to the agreement.
2. Engage the right people who use the right process
Corporate legal operations recognize the potential benefits of the introduction of advanced technologies. However, in order to successfully implement these solutions you must have a team that understands the substance of the legal matters, how best to use the underlying technology, and is committed to digital transformation. Organizations like UnitedLex, which have “digital DNA” are uniquely positioned to make these transformations a success.
3. Make data-driven decisions
The term “data driven” is common parlance in the boardroom, especially in relation to digital transformation initiatives. However, the legal function has been challenged to implement the idea of driving decisions based on data analysis. This is partly due to a lack of access to meaningful data, but also perhaps because of a long history and general preference to rely on the knowledge, experience and intellect of legal teams. But the reality is that the scale and requirement to make faster and better decisions can only be supported by utilizing automation and analytics. That’s why forward-looking GCs like Bill Deckelman of DXC Technologies looked to UnitedLex to help drive over 35% cost savings from his legal function whilst continuing to support the company’s growth agenda.
We are delighted that UnitedLex is partnering with Seal to bring our technology to their clients. We’re even more excited to see the end result: UnitedLex is uniquely positioned to deliver lower cost, less risk, data-driven decisions, and faster onboarding of customer and supplier relationships. In the future the axiom may well be “No GC ever got fired for using AI in their legal department.”
*Gartner: Legal and Compliance Automation Study (2019)