Automating repetitive, time-consuming tasks is the go-to technology for a multitude of tasks today, and contract redlining is no different. In almost every aspect of Contract Management, AI-powered tools are making an impact, including redlining, supporting legal professionals in smoothly navigating through multiple phases of a contract and ensuring compliance with clauses and terms. Ultimately, the credit due to the legal tech companies goes to whatever has been accomplished in digitalizing the CLM process. Today, AI-powered solutions for contract negotiation including redlining have become a reality because of your commitment to building and delivering tools to perform numerous non-core legal tasks.
The Tools of Artificial Intelligence are not Ready from the Get-Go
AI can emulate human behavior but be understood only as accurately as the training it has received. This strongly indicates that AI tools need help understanding their expectations from human expertise. The tools should be taught first about the content flow of contracts specific to an organization, and about the integral clauses, terms, references, sections, price details, tax, and accounting information.
Contract Management, therefore, requires significant data from similar contracts in order for the tool to understand which components should be tracked or redlined in the event of a modification. In the case of a Non-Disclosure Agreement document, it is a prerequisite to developing a training model; it identifies the governing law, indemnification clauses, etc. With this functionality, the tool can compare the final output with a client’s contract playbook and enable a complete review of any modification or update that has taken place. Accordingly, exhaustive AI training is the cornerstone of perfection and flawless contract redlining every time.
Artificial intelligence is built to outperform humans, but it cannot do so without human intelligence. A contract redlining AI tool needs legal input during the training phase. Quality assurance allows AI to be trained to understand concepts and boundaries within various types of contracts and fix errors (or) validate AI-redlined predictions to make them more accurate. Having been taught to identify and understand the nuances of contract redlining, AI is primed to deliver from the get-go. Time can be saved and seamless onboarding can be accomplished.
- Augment your production capacity exponentially: By far, lawyers with AI platforms recognize a dramatic increase in hourly rates compared to those without an AI assistant or virtual office manager. With AI platforms, lawyers are able to maximize their production capacity at a dramatically higher level than most non-AI-enabled lawyers. In so doing, they become equal or sometimes superior in productivity levels when compared to the top 1% of general practice lawyers (with assistants), as well as the top 25% of corporate tax practitioners (who have virtual office managers).
- Save time and money by not answering emails and phone calls: One of the biggest advantages that lawyers enjoy with an AI Contract Management platform is that it allows them to save a significant amount of time while eliminating many administrative tasks such as email correspondence and phone calls. For example, our client was able to implement an e-mail auto-responder feature in his AI assistant. In doing so, our client is able to use the time saved to focus more on billable matters and his practice group’s strategic goals. Moreover, AI assistants are capable of processing calls at a far higher level than existing virtual assistant technologies. As such, lawyers are no longer required to be available for phone conferences or meetings after hours.
- Enhance your market value by making you indispensable: When we first started working with our clients who were not using an AI Contract Management platform, we found that their peers were often less confident in investing in them despite having comparable or better credentials as compared with other candidates for the same type of work. For example, if a law firm was looking for two tax partners, they would not only compare resumes but also the lawyers’ current and future production capacity. Now that they have an AI platform, their peers are more confident in these clients because of what their AI platforms can produce. In so doing, it is much more difficult to replace our clients with M&A partners who are also using or building their own AI platforms.
- Stay relevant in the new legal marketplace: The legal industry will continue to transform over time as younger generations enter law firms with different skill sets than incumbent lawyers (with virtual office managers) and those without any means of practice management assistance at all. These young associates enter law firms with significantly less working capital and overhead costs than older partners, freeing them up to spend more time on matters that they are passionate about. As a result, those Contract Management AI platforms will be the most valuable real estate within law firms in the next five years.
- Avoid being replaced by robots and recruiters: Law firm partners who have created systems like these enjoy significant advantages over peers without similar technology—advantages that increase their market value compared to non-technology-based lawyers as well as young associates looking to leave law firms and become general counsels or in-house counsels at companies? For example, many of our clients have already been approached with offers from headhunting firms with lucrative salaries to leave their current law firm positions to join major public corporations as GCs or high-level in-house corporate counsels, sometimes with equity. in-house counsels. For these lawyers, their future with the law firm will likely depend on their ability to attract new business or bring in new clients that justify both their current role and salary as well as adding them to the group’s management structure. As such, they need a competitive advantage that will allow them to continue to value add and justify higher hourly rates than non-technology-based peers.
Even without offers from headhunting firms, many of our clients have been approached by younger associates from large law firms looking for work elsewhere (because they are not on an AI platform). Our clients enjoy several advantages over these attorneys including being able to offer better perks (including flexible hours) as well as upward mobility within corporate legal departments.
Given the advantages that our clients enjoy from having these AI Contract Management platforms compared to their peers, they are highly unlikely to be replaced by younger associates or head-hunters.
We have found that in addition to substantially improving the workflow and quality of life for lawyers, Contract Management AI platforms can also enhance your value as a lawyer and provide a competitive advantage over other lawyers. Similar results could also be achieved by other law firms that deploy this kind of technology at different stages of practice. To learn more about how you can develop an AI platform like ours for your own firm, please contact us today. We will be happy to discuss how your firm can benefit from such a platform.