The Benefits of Adopting Tech for Your Contracts
For many organisations, contract reviews and management can be a burden. The sheer volume of manual work and time that goes into these low-value tasks can put a significant strain on legal departments. The typical lawyer spends multiple hours of their working day sifting through pages and pages of contracts to find a specific clause. It’s monotonous to say the least, but with potentially negative commercial effects should it go wrong.
With that in mind, it’s obvious why many organizations are adopting legal technology, especially when it comes to contract work. However, the question remains – why do some organisations remain hesitant to adopt these solutions?
The benefits of adopting technology for contracts are often overlooked. Previously, decision-makers saw some contract solutions to be untrustworthy and a hindrance. This was accompanied by a fear of the tech causing them to lose the job that they had spent so long training for.
Unfortunately, what often gets ignored is how the natural assets of a lawyer are strengthened, resulting in improved efficiency and time savings; freeing up respective lawyers to focus on advising and negotiating (the reason they enter the profession in the first place!). Thankfully, there has been a recent shift in judgment. With 60% of legal decision-makers now investing in legal technology solutions (1) for their teams.
Reducing and Managing Risk in the Legal Department
Contracts in business act as risk mitigators and by their very nature, provide a framework whereby parties can collaborate to achieve an outcome that reduces risk on all sides.
However, a stand-alone contract cannot do all the heavy lifting. Lawyers have to be enforcers of these contracts. That is significant weight on the shoulders of an individual, and as we all know, it is inherently human to make mistakes. The combination of human error and contracts is contradictory. The solution in the eyes of many is simple: a contract technology solution.
By using legal tech in your team, users can leverage the risk-mitigating motive of contracts whilst limiting the unintentional yet unavoidable human error that can sometimes accompany lawyer involvement. Contract solutions in these circumstances can offer support to a lawyer by providing a helping hand and ensuring easily missed aspects, such as information in small print, do not fall through the cracks. Furthermore, by freeing up the mind of the lawyer from mundane tasks, they can focus on their legal duties with minimal hindrance, thus minimising risk for the business.
When it comes to mitigating risk, a centralised system for contracts will act as a contract database, meaning that it will be easier to access previous contracts for present transactions. A further benefit is that a centralised system will help the business to ensure contract compliance. By conducting the contract lifecycle electronically rather than manually, the resulting streamlining reduces opportunities for error.
Cost Savings and Maximising High-Value Time
When it comes to budgets, legal departments can be limited on their spend, particularly in-house legal teams. The justification for this is clear, surely it cannot cost that much to review a contract? It should not be ignored that the value of incorporating technology for contracts into your legal team goes far beyond monetary value.
Investing in legal technology could be paramount in getting better time value. This is because providing support to a legal team will inevitably lead to lawyers spending less time on low-value tasks and more time on higher-value tasks. This will then allow lawyers to play integral roles in the business as well as being able to offer commercial advice.
From a cost-savings perspective, it would be naïve to ignore the financial saving that comes with removing the mundane tasks from a lawyer’s day. With the increased time, more clients can be addressed in one day, inevitably leading to an increase in signed orders.
A study conducted by The International Association for Contract and Commercial Management (IACCM) calculated that poor contract management practices cost businesses 9% of their revenues each year (2). What’s more frustrating for business owners is that when these costs were broken down, they were often found to be the result of minor errors such as missing autorenewals. Therefore, when it comes to costs, it makes sense to invest in legal technology solutions for your contracts – the long-term benefits outweigh the short-term costs.
It becomes increasingly clear that one of the key benefits tied to incorporating legal technology for contracts is the potential for commercial growth and development. The adoption of technology brings the opportunity for improved communication and collaboration. Not only does this improve internal communications with a more streamlined solution for collaborative working, but it also allows improved contact with clients. These legal tech solutions help to shape a new legal culture that is customer-centric, collaborative, results-oriented, and innovative.
When looking at the bigger picture for improving commercial global outreach, it was found that businesses who adopted technology solutions increased their global outreach by increasing their high value tasks. This is because technology solutions support various currencies, languages, and logistics options, providing the ease to accommodate contracts from countries across the globe. This has led to better global business relationships, therefore providing access to a wider range of clients and opportunities.
This was evidenced in the Acritas’ Global Elite Law Firm Brand Index 2018. It saw that law firms who demonstrated the greatest increase in brand recognition were global businesses (for example, Clifford Chance, Linklaters, and Allen & Overy). Based on discussions by Joseph Raczynski with these firms, it was shown that the reason behind their progression is due to the adoption of legal technology, such as contract management tools.
How Does Summize Help?
It is evident that legal technology breaks down the barriers and traditions surrounding the legal industry. Adopting tech into businesses has led to a remoulding of the culture, skillsets, and priorities of the modern lawyer. Improving processes by adopting contract technology solutions for a legal team can also have significant impacts on efficiency. Moreover, the other benefits cover a wide spectrum of phenomena from costs to daily duties.
It becomes clearer as legal tech is adopted that innovation in the form of technology is replacing the current incumbent culture. By leveraging the role of the lawyer with assistive rather than replacive tools, these solutions can add immeasurable value to your business. It’s as simple as finding the right one for your team depending on their needs. And Summize could be the platform that works for you.
Summize acts as a legal assistant for all things contracts. Summize will summarise a contract in seconds and identify the key information, saving significant amounts of time and adding value to your service. Summize differentiates itself as a contract solution that is not AI-heavy and is suitable for both large scale projects and low volume bespoke agreements.
Don’t just review it, Summize it.
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