With ever-increasing frequency, in-house counsel is adopting data reporting tools like never before.
Their counterparts at law firms have long used business intelligence tools, such as win rates, financial statistics, and document and case metadata. But now, general counsels (GCs) and legal teams need solid insights on resource allocation and budgeting, too. They rely on contract analytics engines to better understand their company’s risk exposure – and get a jump-start on agreements headed their way for review. They leverage AI analytics to move from being a cost center to a value center, advising their colleagues on operational efficiencies and cost savings.
But the need for historical and predictive analysis of in-force and pending contracts isn’t limited to the legal department. Mid- to senior-level executives – across sales, marketing, finance, manufacturing, logistics, and product management – all benefit from contract-related key performance indicators. Technology executives, too, draw value from advanced yet easy-to-use contract analytics applications and performance dashboards.
With this in mind, they would do well to understand the transformative impact of cloud-based contract management platforms. Preferably, one with an AI-powered analytics “brain.” One that offers pre-built reports based on industry-acknowledged best practices. And, one that enables both IT and non-technical executives to pull data to customize reports based on their unique needs.
Now, let’s look at some of the departments – beyond the corporate legal team – that can benefit from AI-based contract analytics.
1. The IT Team
As a chief technical officer (CTO), I’m quite aware of the many priorities and mandates with which technology executives are faced. Many invest in platforms like Microsoft Azure and Salesforce, and reporting tools like Microsoft PowerBI. So, adopting a contract management system (CMS), which isn’t compatible with existing information management ecosystem, can cause untenable disruption, cost, and delay.
But this can be avoided altogether by using a flexible, fully integrated contract lifecycle management (CLM) solution. With an intelligent analytics application like this, users can run text queries and create customized reports. Alternatively, they can create pie charts or line graphs for data visualization with PowerBI. By empowering non-IT users to access contract analytics, themselves, they can focus on higher-value, strategic initiatives.
2. Manufacturing, Supply Chain, and HR Operations
It’s absolutely critical for companies to ensure the right quality and quantity of people and products to meet contractual obligations. Employee and contractor agreements contain this important information about an associate’s experience, abilities, seniority, and other KPIs. And these can all influence a companies’ ability to meet customer expectations.
If a skill or talent gap needs to be addressed to meet the terms of a statement of work, HR executives require advance notice so they can put the recruiting wheels in motion. If raw materials, components, and inventory need to be available based on contract terms, then shipping and shop floor managers need up-to-date information about supplier performance, on-time delivery statistics, and manufacturing schedules.
Well, contract analytics can help these operational executives make certain they have the people and products to meet their commitments. This data can also help determine a company’s various needs: equipment, tools, and packaging necessary to get products to market.
Finance executives need historical and predictive data insights – like whether a business is outgrowing its office or manufacturing space – to make key decisions. If a corporate merger or acquisition is on the horizon, chief financial officers (CFOs) and other finance leaders can learn a great deal from:
- Their company’s previous takeovers
- Due diligence into the contracts from the company being acquired
- Performance data, such as cost of goods sold (COGS) and sales cycle time – from lead to contract or invoice to cash
- Contract renewal rates, upcoming renewal statistics, and data related to churn
In other words, contract data analytics empowers finance executives to understand the business activities that influence inbound and outbound cash flow. And AI-powered contract analytics, especially, helps CFOs mitigate risk and maximize opportunities that come their way.
Smart Contract Analytics Across the Enterprise
Clearly, there are many departments within organizations – beyond corporate legal – that can benefit from AI-driven contract analytics. Perhaps members of your executive team may view contract data with a vastly different lens, too.
By choosing a SaaS-based CLM platform with integrated analytics, you can mitigate your company’s legal exposure. All this, without unnecessary IT overhead, complex AI/app development cycles, or long user onboarding requirements.