In today's rapidly changing business environment, companies are constantly looking for ways to work more efficiently. With the rise of automation, digitization and artificial intelligence (AI), new opportunities are constantly being identified, created and exploited. This happens in different markets and within different domains and departments.
Smart companies should constantly be on the lookout for new ways to apply this new technology within the business organization, including their legal business departments. Innovation is not only associated with this, but is something that you need to pay extra attention to and pay attention to.
Legal professionals see the need for automation grow, because activities, security and compliance are becoming increasingly complex. This is particularly striking with Contract Lifecycle Management (CLM). Inefficient contract management can cost a company 10 percent of their annual sales. This can be partly caused by missed opportunities in connection with contract deadlines, a poor negotiating position, problems with compliance or operational inefficiencies.
The future of contracts
Currently, 95% of the companies still maintain their contracts themselves (manually). Nevertheless, Gartner predicts that by 2023 around 90% from multinationals worldwide and 50% from regional medium-sized companies contract management software implemented in their company. Companies realize that CLM is not only 'nice to have', but is also an essential part of legal proceedings within a company.
A number of developments in the field of CLM are certainly worth discussing. Although some developments such as AI and Machine Learning are not yet fully developed, it is important to also keep these developments in mind when looking at the future and improving your legal business department. In the following, three trends will be discussed that you should pay extra attention to in the context of CLM in 2020.
1. Workflows & Automation
Not too long ago, automation was associated with complex robots that build the cars of the future. However, automation has been around for much longer - whether or not varying degrees of complexity. From a research from Mckinsey It turned out that in 2030, 800 million jobs could be replaced by automation. This is a remarkable development and will have a major impact on many jobs. Marketing is a good example to demonstrate that automation has value through the success associated with the use of automated emails, better control over follow-ups, and direct segmentation.
Workflows and automation are already becoming part of CLM and have already greatly improved and relaxed legal services and activities. Modern solutions can automate different parts of the contract life cycle management, including document creation, contract approval and automated reminder setup. These developments promote operational productivity, guarantee that you will never miss a deadline for a contract and optimize the relationship with stakeholders.
Software integration can save a lot of time and effort. From an investigation by Gartner it appears that the integration activities up to 2020 are good for 50% of the time and the costs of building a digital platform. ' integrating different solutions has been made easier.
Companies are aware of and expect that the new software they have chosen will integrate 'plug and play' with their own software. This is no different in the field of CLM and there are several examples where this can be seen. The most striking integrations you should pay attention to are CRM, online signing, file sharing (such as Google Drive, Dropbox, etc) and sales software (such as Salesforce). It is also good to know that certain solutions already have integrated features - such as online drawing - that would make integration unnecessary / unnecessary.
3. AI and Machine learning
Technologies such as AI and Machine learning are already part of the contract management revolution. Tagging documents, identifying important clauses and assigning important metadata (such as deadlines and deadlines) in every document save a lot of time and effort. Due to the important nature of the contract details, a human check is still advised to ensure that the information and selected data are correct.
Every organization or legal department that wants to use these CLM trends must first understand the different options available in the market and assess how this will be applied in their area. Ultimately it comes down to getting the most value out of it technological developments and improve the way of working.
Legal innovation is imminent. Legal counsel and departments need to find the right processes and solutions to streamline their work so that they can focus on their role as trusted advisors in the company.