How AI Accuracy in Technology Optimizes Contract Review

Date
February 3, 2022
Category
Date
February 3, 2022
Author
Gary Sangha | Founder & CEO
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Advances in artificial intelligence (AI) over the past decade have revolutionized everything from vaccine therapies to self-driving cars to legal contract review. These technological innovations have allowed machines to adapt to complex rules and environments that may change over time. As a result, legal tech implementations are expanding across corporate legal departments. Presently, some of the most successful AI implementations involve attorneys and machines working in tandem. 

Hand at laptop keyboard with AI overlay representing accuracy in technology

How Accurate Is AI Technology Performing Contract Review?

Head-to-head testing has found:

  • AI can review Non-Disclosure Agreements (NDA) with almost 10% more accuracy than attorneys completing similar reviews.

  • AI’s highest accuracy rating outperforms the highest accuracy rating of an attorney.

Ultimately, the accuracy ratings between veteran attorneys and their AI counterparts are very similar. Here’s the caveat: while an attorney’s review can take a few hours to complete, the AI can perform automated contract markup in just two or three minutes.

What Can AI Accuracy in Technology Do for Contract Review?

It’s unreasonable to expect AI to have true sentience at this point—to know when to push ahead, when to yield, and how to understand the subtle and emotional nuances of a particular counterparty. 

However, AI accuracy in technology offers several distinct advantages, including:

  • Decreasing the amount of time spent reviewing terms and clauses. An AI-powered contract review platform can be as seamless and easy to use as email. Email or upload an agreement to the platform to initiate the AI review, which will flag any deviations from standard negotiating positions and offer context-based suggestions for playbook-compliant revisions.

  • Cross-referencing past contracts to identify unenforceable language. Unlike attorneys who must sift through past agreements and internal documents in search of context to justify a suggested change, the AI retrieves that information instantaneously. Leveraging AI accuracy, technology like LexCheck alleviates time-consuming contract review tasks and helps eliminate back-and-forth phone calls and emails among legal staff.

  • Performing a comprehensive contract review and risk analysis. With multiple deadlines looming, prioritization can be a challenge. AI contract review technology can fully redline an entire contract in less than five minutes. In response to redlining and risk analysis, the contract may be forwarded directly to the counterparty or escalated for senior attorney review. A leading AI contract platform can reduce escalation rates from 80 percent to 10 percent, saving senior legal reviewers valuable time they can use to strengthen client relationships and concentrate on other high-level tasks. 

  • Saving time and money on training new employees in contract review. New hires do not arrive with an innate understanding of company playbook guidelines, and learning the ropes takes time. Optimizing your training with an AI contract platform can help new hires learn standard negotiating positions while ensuring agreements maintain playbook compliance.

A study of 1,500 companies conducted by Harvard Business Review concluded that AI works best when coupled with human oversight. While robots are more efficient and accurate at data processing, humans provide empathy and consideration unavailable to computers. 

What Is the Most Accurate AI Technology for Contract Review?

Lexcheck was founded by Gary Sangha, a former AmLaw 100 associate and CodeX Fellow at The Stanford Center for Legal Informatics. In pursuing revolutionary technology solutions for the legal field, Sangha focused on the ubiquity of errors, omissions, and oversights in contract analysis.

His answer? LexCheck. The AI-powered platform can detect ambiguity, search for adherence to the company’s AI Digital Playbook, and perform contract risk analysis. At the end of the day, LexCheck’s AI accuracy exceeds its attorney counterparts while reducing review time by more than 90% and reducing the total time-to-execution by more than 33%.

LexCheck leverages accuracy in technology and AI to automate contract review and negotiation. To learn how your company can leverage AI to accelerate contract approval, contact us at sales@lexcheck.com, or request a demo to experience the technology first-hand.

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