Legal AI and ML platforms will perform fully automated contract review and extraction, or many will have you believe so that the human contract review process will be a thing of the past. However, that’s far from the truth. According to recent research by IACCM, 80% of all CLM deployments fail. This is true for AI-based platforms too. The best of both worlds can be achieved only when the AI-based CLM platforms partner with trained, legal experts. This is because AI and ML can be trained to perform repetitive tasks, but when it comes to reviewing documents and exercising discretion, humans are irreplaceable.
Here’s why AI and ML can never outdo human intervention:
One of the biggest hurdles with totally relying on AI and ML infused CLMs is the lack of quality control. AI and ML use a fixed set of attributes for extracting data from the contracts. Now, these attributes are limited, and also, many a time, the software relies on handwritten attributes. Again, from 100+ attributes fed to the AI, the data model may use just a few common attributes, disregarding the others.
Another reason why humans are irreplaceable is that the Contract data is unstructured and unformatted. Also, there are different types of contracts such as NDAs, MSAs, SaaS licenses, Sales agreements, Lease agreements, and more. Each of these agreements will have different contract properties to be extracted. For an ML model to be effective, it will have to be trained for 100+ attributes for each of the agreement types. Wondering why should extract these contract data? This blog details the key reasons.
In reality, AI cannot work alone. It necessitates human intervention to ensure accurate data extraction. Cenza works with legal AI providers to adopts a human contract review process to validate AI outputs. Our team comprises lawyers with in-depth knowledge of contract laws and ensures error-free, quality work. We give valuable insights about their existing contracts and an overall delightful experience for our clients.
Legal Expertise and Ethics
Laws are ever-changing. There may be a new clause, or some clauses may become redundant over time. No matter how proficient an AI program is, it cannot be updated in real-time. Even if the AI is updated, only professionals with expert knowledge can understand the nitty-gritty of the law and the impact it has on contracts. Certainly, this is something only trained legal experts can handle. A particular mention here is the alarming number of Force Majeure in contracts post-Covid.
Another point in the case is Libor repapering. The transition away from LIBOR has necessitated financial institutions to dig out contracts that need aligning with alternative reference rates instead of LIBOR. Discontinuing LIBOR affects several financial products and businesses and involves significant work, which is possible only when AI and lawyers work in tandem.
Augment Contract Review Process with Cenza:
Automated contract reviews cannot replace lawyers. AI and humans complement each other. While AI offers speed and precision, humans have the unique ability to understand, adapt and use discretion for accurate outcomes. That is why AI and humans are the future of Contract Management. When considering outsourcing contract review, Cenza can help. We have a team of experienced lawyers. Once a client comes on board, our lawyers undergo a training process for a deep insight into laws in your jurisdiction and ensure reliability and accuracy at scale. Cenza is ISO 27001 certified. We have frequent audits, stringent security measures to ensure data privacy for companies. In short, Cenza offers a hassle-free, secure experience to our clients.
Best outcomes for contract review are possible only when AI is augmented with human contract review, and Cenza offers the best!