Digitization has brought about far-reaching changes in numerous business areas, particularly through the use of advanced technologies such as artificial intelligence (AI). In the area of contract management, AI is helping to make processes more efficient and accurate. An analysis by Goldman Sachs found that the use of automation in contract management can speed up negotiations by up to 50%. Thanks to AI technologies, contract content can be analyzed accurately and quickly, leading to informed decisions and optimized resource utilization.
Contract analysis is a central step in contract management. It is used to systematically record the contents and details of a contract. As technology has advanced, particularly in areas such as artificial intelligence, the way contracts are analyzed has also evolved. AI-powered contract analysis uses technologies such as natural language processing (NLP) and machine learning to analyze and evaluate the entire text of a contract and break it down into its constituent parts. Such advanced tools are able to accurately identify and categorize specific contract details - be it deadlines, obligations or other relevant aspects. The result is a fast and comprehensive insight into the most important contract information, which significantly facilitates and optimizes contract management.
Manually capturing contracts can be both time-consuming and prone to errors, especially when dealing with hundreds of contracts. To simplify these processes and make them more secure, relevant data can now be extracted from contracts automatically.
Artificial intelligence (AI) can efficiently categorize and index contract information. Important details such as term, end date, contract partner and contract category are captured. In addition, the Optical Character Recognition (OCR) function can be used to make text from scanned documents or images searchable, extract it and categorize it automatically. This not only speeds up the onboarding phase of new contracts, but also protects against risks associated with manual data entry.
While current AI tools already add significant value to contract management, the next generation of the technology is about to hit the market. It will further deepen the possibilities of data analysis and interpretation.
Future AI-based tools could revolutionize contract management by not only processing but also analyzing large amounts of data in detail. These advanced tools will be designed to recognize complex patterns in contract data. This capability will be particularly useful, as patterns can often provide insight into recurring themes or potential risks in contracts.
In addition, future AI will be able to detect unexpected anomalies. For example, it could detect unusual clauses in a contract or identify deviations from standard contract terms. Spotting such anomalies early on will be critical to identifying potential problems and taking appropriate action. The end result will be streamlined contract management, leading to faster, more accurate and more cost-effective outcomes.
In the future, AI-based contract management solutions could combine numerous functions and processes on a single platform. They would combine different tools, eliminating the need for users to switch back and forth between different applications to review or edit contracts. This results in significant time savings and increases efficiency. In addition, these future systems would provide quick access to relevant contract information and could even generate automated responses. This simplifies and speeds up the response to contract-related inquiries and requests.
AI-driven contract software could provide users with tools to ensure consistency and uniformity in contracts. A key feature could be predefined templates generated from data analyzed with natural language processing (NLP) to provide standardized terms and clauses. Users could use these templates to ensure consistency when creating new contracts. Additionally, the software could provide a discrepancy detection function. When a user enters or uploads a contract that deviates from the standard wording, the software would automatically detect these deviations and alert the user. This would allow variations in contract clauses to be effectively tracked. When deviations or potential errors are detected, the software could make automated revision suggestions. This would not only help minimize human error, but also ensure that the contract meets corporate standards. This would allow companies to effectively track and standardize variations in contract clauses and minimize the risk of human error and inconsistency.
AI-powered software easily scales with a company's growing needs compared to limited human capacity - without the cost of additional staff. Whether a company has 100 or 10,000 contracts to process, a future AI-powered solution can handle the task with ease. This gives companies the flexibility to adapt to changing business needs without investing in additional resources or training.
ContractHero uses AI technology to automatically extract essential contract data from documents. The AI identifies and extracts specific data such as the name of the contracting party, relevant term and termination dates, and financial details such as monthly payments. After this data is automatically captured, it is entered directly into the associated fields in the system. In this way, ContractHero already provides users with a comprehensive database that they can add to as needed. This saves valuable time and reduces manual effort by pre-filling much of the required information.
If you are interested in the potential return on investment when implementing ContractHero, we invite you to take advantage of our ROI calculator.
Arrange a free demo now and experience how ContractHero can revolutionize your contract management!
Digitalization, especially through the use of AI, has fundamentally changed contract management. Traditional methods, which are time-consuming, error-prone and often not scalable, are being replaced by efficient, accurate and scalable AI-powered methods. AI technology not only enables rapid and thorough analysis of contracts, but also reduces human error and promotes understanding of complex content. Solutions like ContractHero use this technology to optimize processes around contracts through AI-based contract analytics and help companies save valuable resources. One example of this is the company hhpberlin, which was able to realize savings of 100,000 euros in its first fiscal year using ContractHero's software.
Find out everything you need to know about loan agreements, including key points, interest rates, collateral and legal aspects.