Human-in-the-Loop vs. Fully Automated AI Contract Review Software

icon-contractAlmost one-third of legal departments reported increased spending on technology in 2020 with plans for even more in 2021, and AI contract review was a popular target area. Implementing this technology enhances operational efficiency and enables legal departments to eliminate wasted hours spent on tedious review of standard agreements, time which could be more wisely allocated. An AI contract review solution can streamline and automate contract review processes.

Tablet user on AI contract review platform

Of course, you must choose the appropriate contract review solution. Much of what is available on the market comes with significant limitations compared to expectations. To ensure you make an informed choice when deciding on a contract review solution, you’ll need to understand the basics of the software, the difference between human-in-the-loop and fully-automated technology, and the available options that fit the needs of your legal department.

Human-in-the-Loop vs. Fully Automated Legal Technology

When assessing contract review solution, consider the difference between the two primary offerings: human-in-the-loop and fully automated.

  • Human-in-the-Loop: Technology that leverages human-in-the-loop strategies requires some level of user intervention. This might include adding data, writing specific components, or answering questions to guide the software from beginning to end. 
  • Fully Automated: Automated technology can function without human intervention, but traditional offerings are limited to text extraction or redlining. These options can recognize and pull key terms, store them in a database, and use them to manage contracts in bulk. They can also highlight areas of concern and make some suggestions for improvement. 

The following table provides a concise guide on the general pros and cons of the two types of contract analytics solutions.

 

Human-in-the-Loop

Fully Automated 

Pros

Detail: Software that leverages human intervention can give more detailed analysis as they have a person guiding them who can make subjective decisions that a machine may not handle. 

Control: An AI solution that leverages a person to facilitate the completion of the process is easier to monitor, and operators can make changes as needed.   

Speed: Fully automated solutions boast speeds unattainable by humans, sometimes completing tasks in a few minutes that would have otherwise required hours or even days of human review.   

Accuracy: As long as the data and inputs are correct, the technology will accurately process all contract details without errors or oversights. 

Cons

Delays: Portions of a human-in-the-loop solution may stall if a reviewer is unavailable to complete a required action. These delays can create a domino effect adding bottlenecks and inefficiency if not carefully controlled.  

Inconsistency: Human-in-the-loop technology is only as good as its operator. A more expert user will garner better results than others. 

Limited insight: Some fully automated solutions identify information without providing detailed suggestions or actionable data.  

Data needs: Many fully automated solutions will require copious data to make inferences and understand actions to be performed. 


Choosing Software for AI Contract Review Based on Automation Capabilities

Typically, legal teams will make a tradeoff for capabilities when choosing human-in-the-loop versus fully automated software—but that is not always the case. Some companies have developed options that are both highly detailed and fully automated. These solutions will often combine data analysis, Natural Language Processing (NLP), and AI to review contracts and understand them. 

Since organizations adhere to specific negotiation strategies when discussing contracts, the most innovative technologies apply an AI Digital Playbook to guide contract review and negotiation. Leveraging this playbook in AI contract review software allows the entire process—from negotiation to final approval and signature—can be fully automated.

The best way to decide between human-in-the-loop versus automated AI contract review technology is to compare the full, end to end processes. The results will display the level of detail users can expect and help them understand how much human intervention will be required to ensure their agreements are negotiated effectively and in alignment with company standards. Both types of review approaches have their uses. However, the best technology solutions offer a fully automated experience with detail previously only seen by human-in-the-loop solutions.

LexCheck's AI contract review and negotiation platform combines the detail of a human-in-the-loop solution with the speed and efficiency of full automation. Request a demo to see how it works, or contact us at sales@lexcheck.com to learn more.

gary-sanghaGary Sangha | Founder & CEO

Gary Sangha is the Founder and CEO LexCheck. He's a serial entrepreneur and an academic. Gary previously founded Intelligize, a legal technology company that was acquired by LexisNexis. He's affiliated with the University of Pennsylvania and Stanford University and started his career as an attorney at Shearman & Sterling and White & Case.