What Is Connected Contract Data and Why Is It Important?
Contract and contract management technology is experiencing a profound change. For some 30 years, the focus has been on managing the document. With advances in artificial intelligence (AI) for contracts, the market is now increasingly focused on managing the data – the critical information (such as parties, terms, dates, obligations, benefits, or concepts) contained in those documents that collectively serve as the foundation of any business.
We are seeing the evolution of the contract lifecycle management (CLM) market. It is shifting from focusing on allowing an organization to produce a contract and go through the contract workflow (request, creation, negotiation, approval, and signature), towards also focusing on unlocking the data and insights within the agreement to deliver insights to downstream systems. We call this capability “connected contract data.”
Innovative business leaders are capitalizing on this inflection point in the market, seizing the opportunity provided by connected contract data to help their teams adapt quickly to changing economic, regulatory, or geopolitical conditions. With crucial contract information at hand, businesses can gain the first mover advantage and drive competitive differentiation. Without it, they’re merely reactive.
Growing companies that are looking for a contract technology solution for the first time now have a straightforward path for contract management. They can implement an AI-powered CLM platform and have all their agreements in a single solution. They will have insight into their agreements and can automate, simplify, or even eliminate workflows – without a lengthy implementation or significant change management.
Larger companies, on the other hand, typically already have multiple systems of agreements, and they may not want to change them. Since these legacy systems have likely been in place for quite some time, it is unlikely that these disparate systems of agreements are unified or integrated together across the enterprise. Without connected contract data, many organizations experience confusion and potential financial risk because data silos create inconsistencies, redundancies, and a lack of visibility into operations.
Regardless of having many disparate systems and not wanting to undertake the task of unifying them in one place, these larger companies still have the ability to achieve connected contract data by leveraging a data layer that connects siloed systems of agreements. Having a data layer that is available to connect to those systems, analyze what is in them, and present that data back can help provide the company a 360-degree view of its relationships, obligations, and opportunities across the entire business.
What Is Connected Contract Data?
Connected contract data is achieved when data such as payment terms, renewal dates, breach notice obligations, and more is extracted from contracts and fed into other systems (such as ERP, procure-to-pay, and CRM solutions) via integrations or APIs, ensuring that all data is current without the need for manual updates. When they know that all the data in their systems is consistent and up-to-date, teams can focus on making better business decisions with valuable information at their fingertips.
Having connected contract data means that all contract information is being shared appropriately and securely across teams and systems to provide accurate actionable insights into an organization’s contract management, vendor management, partner relations, and related priorities. Oftentimes, contract management dependencies will arise across multiple processes (such as purchase requisition, GRC compliance checklists, approval and workflow rules), hence the need to connect contract data with the data managed by those processes.
What Is a Connected Contract Management Solution?
A connected contract management solution takes an innovative approach to connecting critical processes and the data managed by those processes across different enterprise systems. Such a solution should leverage well-trained contract AI, which can achieve highly scalable data extraction. Advancements in data science and how we think about data structures have resulted in AI that can process much larger datasets in a dramatically shorter period of time than was possible just a few years ago. Many legacy contract management solutions are built with the old paradigm of the document as the foundation, whereas leading AI-powered contract management technology starts with the data as the foundation.
How Can You Use Connected Contract Data?
- Accounting teams need access to contract data including responsibility for tariffs and taxes, audit rights, record-keeping obligations, payment terms, termination rights, and expiry dates.
- Finance teams need access to contract data including payment terms, early payment discounts and late payment penalties, royalties, price escalation clauses, inflation adjustment clauses, and termination rights (for cause and convenience).
- HR teams need access to contract data including non-solicit agreements, trade secret confidentiality terms, and more.
- IT teams need access to contract data including SLAs, licenses, security compliance, IP rights, and data breach obligations.
- Legal teams need access to contract data including IP rights, licenses, confidentiality, compliance with laws and regulations, royalties, limitations of liability, non-competes, assignment and change of control restrictions (for mergers and acquisitions).
- Marketing teams need access to contract data including publicity and promotion rights, ESG-related terms, and customer data collection rights.
- Operations teams need access to contract data including vendor agreements, compliance data, security data, and more.
- Procurement teams need access to contract data including payment terms and schedule, quality SLAs, rebates, discounts, surcharges, price adjustment terms, MFNs, delivery terms, termination rights (for cause and convenience), price and contract value, force majeure/excused breaches, expiration and renewal dates, and incentive/performance payments.
- Risk teams need access to contract data including indemnification duties, liability caps, and insurance requirements.
- Sales and sales operations teams need access to contract data including MFN clauses, discounts, rebates, price adjustments, pricing models, addendums, expiration and renewal dates, price and contract value, payment terms and schedule, termination rights (for cause and convenience), partial shipment rights, and incentive/performance payments.
How Can You Get Connected Contract Data?
Evisort’s contract intelligence platform leverages AI-powered data extraction to instantly extract clauses, fields, and metadata upon contract upload and ingestion. Evisort allows organizations to upload a contract the system has never seen before and call out insights within a matter of seconds, including who the contract is with, when the contract renews or expires, what the pricing terms are, what each party's obligations are, and more.
On top of data extraction, Evisort provides intuitive search and data visualization tools across all contracts. These AI-powered capabilities give the end-user access to connected contract data to make faster, better business decisions informed by accurate, up-to-date data.
To see how Evisort can provide your organization connected contract data, request a personalized demonstration here or explore additional resources below:
Customer Success Stories for Connected Contract Data
- NetApp uses Evisort’s AI-powered contract management and analysis software to locate contracts with partial shipment terms and set up renewal alerts.
- Plug Power modernized its contract management processes and repository through Evisort’s AI-driving functionalities and advanced OCR capabilities.
- Jelly Belly uses Evisort’s AI-powered contract management and analysis software to consolidate and streamline multiple slow, manual contract review processes.
Reports for Connected Contract Data
- Gartner® Report: 2022 Magic Quadrant Contract Life Cycle Management
- Buyer's Guide: Evaluating and Selecting the Best CLM Solution for Your Organization
- ESG Showcase: Secure SaaS Contract Management with Evisort
On-Demand Webinars for Connected Contract Data
- Elevating Contract Management with AI-Powered Automation, Featuring Microsoft
- Optimizing Contract Management for In-House Legal Teams
- Thinking Big With Contract Intelligence
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