How Automated Contract Markup Accelerates Negotiations

Date
July 13, 2021
Category
Date
July 13, 2021
Author
Gary Sangha | Founder & CEO
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Contracts are fundamental to every deal, whether you are focused on merging companies, protecting trade secrets, or outlining how a business relationship will unfold. Traditionally, a contract can take weeks or even months to negotiate. However, corporate culture today values immediacy, and businesses are placing increased pressure on legal departments to speed up the review and negotiation process.

Automated contract review using Artificial Intelligence speeds negotiation time by up to 90 percent

Artificial intelligence (AI) technology offers a leading-edge solution that automates the markup process during contract negotiations. The AI identifies clauses or conditions that fall outside company or industry guidelines. After highlighting these issues, the AI leverages natural language processing (NLP) technology to suggest specific changes aligned with a company’s playbook standards. Automated contract markup not only accelerates contract review but can significantly reduce errors and omissions in the review process.

How Automated Contract Markup Saves Time

Once two parties agree to do business and a contract is drafted, a junior associate will typically perform an initial review of the agreement. This process can take several hours to complete. After the junior associate has completed an initial review, a more senior attorney would typically review the agreement and make any required corrections. Several more hours might be required for this stage of the contract review and negotiation process.   

Enterprise-level negotiations can easily be required for tens of thousands of contracts in a given year. The hours required to complete the review process described above—at scale—add up quickly. 

Alternatively, an innovative AI-powered contract negotiation platform can review and redline an entire contract in only a few minutes. The AI’s playbook-based suggestions can then be automatically incorporated or reviewed by a senior member of the team. 

Features of automated contract markup include the following:

  • Highlights clause changes and conducts version comparisons
  • Defines specific, acceptable negotiation boundaries, limits, and thresholds
  • Aligns procurement, vendor, and legal around commonly accepted standards
  • Mitigates risk by automatically highlighting stand-out clauses outside playbook standards
  • Flags varying provisions and outliers that most likely need amending
  • Suggests revisions based on playbook standards and prior successful negotiations

Early AI adopters have found that this technology can cut the total review process significantly for their most complex contracts. Legal departments handling standard agreements have reduced their review and negotiation processes by 90 percent.

Introducing LexCheck, a Leader in AI Automated Contract Markup

LexCheck’s AI-powered contract negotiation platform leverages machine learning (ML) and NLP to automate and accelerate the contract markup and negotiation process. The system incorporates data from a repository of standard contracts along with a company’s playbook-specific guidelines to ensure all terms and clauses adhere to company standards. 

Companies using LexCheck can submit contracts for review by email or upload them directly to the platform. The AI reviews the contract based on the company’s internal playbook and a database of pre-loaded contracts. Often, the AI can return fully-reviewed and redlined contracts within minutes. For agreements with outlying provisions, the AI can suggest context-based changes that adhere to playbook standards and can be implemented right away or flagged for further review. 

While complex deals will often require human oversight, AI has developed to a point where it can handle most everyday contracts automatically. Contracts including Non-Disclosure Agreements, Master Service Agreements, SaaS contracts, purchase orders, and even Mergers and Acquisitions are among the most commonly automated contracts. 

Legal departments that have implemented LexCheck’s next-generation technology have enjoyed unprecedented time savings and eliminated contract management bottlenecks that can affect the entire company’s productivity and efficiency. By leveraging an automated contract review, markup, and negotiation platform, legal departments and procurement teams have accelerated sluggish contract review processes to conduct more business and close more deals while saving clients time and money.

Contact LexCheck to discover how an automated contract markup and negotiation platform powered by AI can eliminate bottlenecks and streamline negotiations at your company. To experience the technology first-hand, request a demo. Or reach out to us at sales@lexcheck.com to learn more.

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