Here we will cover the five factors you need to be looking at when shopping for an AI (artificial intelligence) based contract management system.
It’s 5:30pm on a Friday and you receive an email from your CFO assigning you the task of reporting to him all of the executed contracts with publicity clauses your company has over 150K. You have approximately 10K contracts located in multiple repositories and limited insight into what is where. Order a Pizza and fire up the Keurig — looks like you’re in for a long weekend.
If this sounds anything like you, then you know how cumbersome the task of managing contracts can be without a modern, AI-powered Contract Management System in place.
So you’re in the market for a Contract Management System. Great. This article is designed to help you compare apples to apples (and avoid the lemons). We did the leg work for you (based on hundreds of customer interviews) to narrow down the most vital features to look for in your search:
- Centralized Repository
- Custom Reporting and Tracking
- Contract Risk Mitigation Review
- 3rd Party Paper Accessible
- Accurate Data
It should be a deal breaker if the CMS you’re evaluating doesn’t have the ability to provide you a single source of truth for your contracts amongst multiple locations. This allows you to access insights from any contract across your organization when you need it most. One contract database to rule them all. One central location. One single source of truth. A CMS should provide all the document management features you need to track all of your contractual obligations and manage your approval processes in one place. It should also keep a track record of previous versions of contracts for easy reference using version control.
Custom Reporting and Tracking
The secret is out. Data is the new gold and we’re in the midst of the great migration. The combined data within the repository of your organization’s contracts may be a gold mine of insights, but if the data isn’t actionable it’s like using your bare hands to dig through the bedrock. Your ideal CMS allows you to easily query and track information in your contracts, such as expiration dates, contract value, key date alerts and key provisions, giving you the ability to take action. A good CMS should encompass the entire contract management process from contract generation to electronic signature so you no longer have to deal with separate templating tools and paper signatures. It should allow you to focus more on business relationships and contract negotiations and less on manual work.
Contract Risk Mitigation Review
Having a Centralized Repository for your organizations contracts allows you to more easily identify risks associated with non-compliance in any of the agreements you’ve made within your contracts. Some contract management solutions even have the ability to assist in the contract review process by utilizing AI to cross reference your standardized language with the language in a 3rd party document and automatically flag where the language in non-compliant.
3rd Party Paper Accessible
This is something you would think would come standard with all modern contract management software, and yet still in 2019 there are some CMS solutions out there that only allow you to access insights on contracts you’ve created in their system with no accessibility for documents generated from a 3rd party. What good is the data in your contracts if you don’t have the ability to compare and contrast data amongst all of your contracts?
Accuracy seems like something that would be industry standard as well amongst CMS providers that provide an automated way to extract data from contracts. It’s important to note the fact that not all “AI” is created equal. Many companies utilize a rule based AI called RPA, which is limited in the sense that it’s only as good as the rules the human has created.
To give you further context, with RPA, artificial intelligence may be trained to look for information in one fixed location, but if the information happens to move then the results are inaccurate. This is not what you want.
If you do choose to go the AI route it’s best to find a CMS provider that uses Machine Learning AI. Machine Learning is the type of AI that is able to intuitively find data within your contracts, no matter where on the page it’s located. With an AI-based search you can find the clauses or provisions you are looking for across your entire central repository.
If you are wondering if there is a CMS that does all of this and more, we highly suggest taking a look Evisort. Book a demo today to try out our contract management system for yourself.
If you do choose to go the AI route it’s best to find a CMS provider that uses Machine Learning AI. Machine Learning is the type of AI that is able to intuitively find data within your contracts, no matter where on the page it’s located.
By Jeff Moore, Senior Contract Management Consultant at Evisort