If you are a part of a corporate legal department, at some point in your career, you have probably been on Dropbox holding back tears at the sight of the number of contracts you’ve had to review as part of due diligence. The legal due diligence process is one that is complex and time-consuming but also extremely necessary. That being said, this indispensable process filled with numerous process level inefficiencies.
While Legal departments often face a lack of time and resources, they are still required to drive accurate and trustworthy performance.
As part of due diligence activities, legal teams often must examine various agreement types, and conduct a seamless review for contracts which may run into hundreds and thousands of pages. Because they are not equipped with sound technology, the burden falls directly on them. The weeks and even months taken in ensuring a thorough contract review can harm the deal and drive costs to the roof.
As part of due diligence activities, legal teams often must examine various agreement types, and conduct a seamless review for contracts which may run into hundreds and thousands of pages
The good news is that there is a better way to do it. And that is by using Artificial Intelligence in Contract Review. In the current era where A.I is driving widespread innovation in legal technology, here are 4 reasons you need to adopt A.I. for due diligence:
1) Time Theft Begone
A due-diligence software will allow you to bulk upload your contracts onto a secure cloud in no time. No more individually uploading contracts or waiting for ages, as your zip folder with thousands of contracts uploads onto Dropbox.
A central cloud-based repository for your contracts means you get a 100% visibility on your enterprise-wide contracts. And once these contracts uploaded, the A.I. instantly categorizes them by Party Names, Dates, and Type of agreement and presents it to you in seconds. The days of your laptop slowing down because you have 25 tabs open are in the past.
The A.I. instantly categorizes your high-volume contracts by Party Names, Dates, and Type of Agreement and presents it to you in seconds
2) Cover more ground with lightning-fast review
The A.I will go through your bulk of contracts to fill in your due-diligence template for you. No longer spending days drowning in the fine print of contracts just to locate relevant clauses and contractual obligations. Sit back and enjoy the recognition being done automatically for you! All you’ve got to do is run a final check on these ‘smart summaries’. This final-check process is also made easy because you can use the A.I. engine as your own legal focused Google Search for your entire contract ecosystem.
You can use the A.I. engine as your own legal focused Google Search for your entire contract ecosystem
With E-discovery, you can fetch information for any search term and get a contextual result for it across thousands of contract documents in seconds. For example – If you need to look for information related to ‘Change of Control’ clause across your high-volume contracts, you can now do it in seconds, instead of you manually looking it up. Long story short, hundreds of contracts are now fully searchable in one go without you spending hours and hours, doing a “CTRL+F” on each individual document.
With E-discovery you can fetch information for any search term and get a contextual result for it across thousands of contract documents in seconds
3) Reduce Risk (and anxiety)
A big factor that feeds into due-diligence stress is the niggling feeling that your or your team has missed an important point. That ‘important point’ could end up costing you the deal. With such a large workload usually accompanied by time constraints, manual errors are bound to arise. This is because, manually reading hundreds of pages of contract documents causes fatigue, which makes spotting errors and inconsistencies more difficult.
Reading hundreds of pages of fine print of contract documents causes fatigue, which makes spotting errors and inconsistencies more difficult
Applying A.I. in contract review in your workflow helps your team hit that sweet spot between quality, speed and accuracy. The software will often notify you of any discrepancies or dissimilarities in the current contracts you are reviewing because of what it has learnt from your standard contracts in the past. It will also be able to notify you of any conflicting terms in a set of contracts.
Since all rules are set and defined in one place, there is no chance that you or your team member will ever miss out on a clause.
4) Less Costs and More ROI
Due diligence is a process that is repetitive, tedious, and requires a great deal of manpower and hours. While important, the time and effort needed for this drives up your firm’s costs. With A.I. to tackle this process, your competent workforce can spend time doing high value tasks. An increase in work turn-around means an increase in capacity to take up more clients and render them with high quality services. You can be up and running fast, cut legal costs and drive great return on investment (ROI) in both the short and long term.
With A.I. tackling repetitive tasks, you can be up and running fast, cut legal costs and drive great return on investment (ROI) in both the short and long term
Conclusion
Adopting A.I. in due diligence is one of the key ways in which your legal teams can embrace innovation and increase efficiency. AI in due diligence and contract reviews helps you to maintain a competitive edge while enhancing your Legal teams’ job satisfaction.
With A.I. taking care of routine contracts, legal teams can focus on more interesting parts of their job. It empowers your Legal teams as they can now be more responsive to activities that need critical attention to an emerging legal issue.
With A.I. taking repetitive work off their plate, your legal teams are always at the top of their game, enabling other business units across your enterprise with their strategic legal insights. If you are working in a global enterprise, just imagine the impact this can have on your overall business!
