AI-powered contract review tools can enhance a lawyer’s efficiency by 34% and productivity by 51.5% – according to a study by Onit.
This is clear evidence of how AI application in legal operations can benefit a legal team and the organization. But productivity is not the only merit legal AI offers; hence, it cannot be the only factor to measure the ROI of embracing this technology.
Investing in legal technology is on a steady rise. However, corporate legal houses are yet to build a strong case for the adoption, primarily due to the inability to demonstrate the real value of embracing technology. While productivity is one true measure, it cannot be the sole case to convince buy-in from decision-makers. Instead, it needs to emphasize commercial viability and organizational performance as critical factors while justifying AI spending.
Here is how you can make a case for creating a perfect win-win solution for deploying legal AI.
The number of contracts signed: This is more of an immediate, easily measurable benefit. It’s just a simple measurement of how many contracts have been signed before and after technology adoption. While it is a straightforward calculation, the merits are vast. First and foremost, the increase in the number of contracts signed has a direct impact on revenue. But not just the commercial benefit, there are several allied merits associated with this factor, the primary of which is the enhanced efficiency of the legal team.
Time spent in deal closure: A contracting process involves several tasks and teams, starting with drafting, reviewing, negotiating, and signing off the deal. The time taken for the end-to-end process is as huge as the list of sub-processes encompassed. An AI-powered Contract Management platform can accelerate the entire process on par with the business requirements. As with the previous factor, it is a mere comparison of the time required for deal closure. The increase in speed, or rather reduction in the time spent in the overall process, helps in improving customer experience and business relationships. It also helps prevent any delay that could oscillate customer confidence and strengthen brand trust.
Incidence of compliance: This is one factor that every organization tracks to avoid the recurrences of incidences leading to compliance issues and penalties. With AI in your arsenal, it can deter risks that could jeopardize business goals. For instance, an AI Contract Management System can empower the team to assess the performance against the defined clauses in real-time. With intelligent dashboarding inherent in today’s legal AI tools, the respective stakeholders can gather insights, track key dates, and ensure that every obligation is adhered to. In case the tool senses a risk, it flags off for a lawyer’s review. To simply put, it is an easily-quantifiable measure of legal AI’s ROI.
Ease of adoption: One reason that has been dissuading the use of legal AI is the nuances involved. As with every change involving technology, people do find it challenging to get accustomed to the functionalities of an AI tool. But the success lies in the choice of the tool itself. It should ideally be easy to use, requiring little effort to learn its features and operations. However, the real triumph is with what it offers. A scalable AI solution with room for improvements, be it in terms of the number of contracts uploaded or custom insights from contracts data, is the best deal. So, the measure here is the go-live duration of the solution.
Savings on legal operations: A legal team is laden with many tasks, some of which get outsourced either due to lack of resources or expertise. Since AI tools for legal are built by considering every aspect of the workflow, they become the one-stop-shop for the entire contracting lifecycle. As they automate most of the manual, time-intensive tasks, much productive time is saved for strategic priorities. The legal, operational activities consolidated in one system with a streamlined process flow further enhance the team’s efficiency and, of course, productivity.
While those mentioned above are evidently measurable benefits of legal AI tools, several allied benefits could impel decision-makers to incline towards the adoption. The best of them is boosting team spirit, as they get to be more involved in strategic tasks and impact their contributions. Being relieved of the manual, mundane activities, which could seem tedious at times, will have a long-lasting effect on the quality of their work-life. As a ripple effect, they become more innovative and efficient, which is indeed an incredible benefit from an organizational perspective. It may not be a quickly quantifiable factor but rather a qualitative benefit that decision-makers cannot overlook in their efforts to sustain performance excellence.
Hope this information presented here will come in handy when you build a winning case for legal AI adoption. If you need expert assistance for a headstart, then team Cenza would be glad to be of your assistance.
We are a Managed Legal Services provider with strong hands-on experience in legal AI deployment and training. In our experience spanning over two decades, we have had the privilege to work with some of the leading corporations, law firms, and banking & financial institutions, aiding them in embarking on successful legal technology adoption.
To know more about our capabilities, please get in touch with us.