Contract review software and automation - the 2023 guide

The ins and outs of contract review

Contract review is a process for verifying the accuracy and validity of contracts, agreements, and other legal documents. It includes carefully examining each clause of the contract to ensure it meets all applicable laws and regulations, and that it leaves no room for misinterpretation. It also means checking for any discrepancies or typos that could lead to costly mistakes further down the line.

In most cases, contract review is conducted manually by a lawyer or legal team. This can be an arduous process, with lots of back-and-forth between the parties involved. However, contract review is usually less expensive than a breach of contract lawsuit.

Why contract review software exists

Contract review is an essential part of the legal process. It helps ensure that contracts are legally binding and enforceable in a court of law, protecting both parties from any potential disputes or misunderstandings. A good contract review process ensures that any unclear or outdated provisions are identified. It is also a tool for tracking risk for each party and determining whether the balance between them is satisfactory.

The people involved in the contract review process

Contract review can be an expensive process because it cannot be completed by just one person. Generally, a team of legal professionals with specific expertise in contract law is required. This can include lawyers, a legal counsel, paralegals, and other professionals such as compliance officers and risk managers. Sales representatives are also usually present, drafting the initial terms based on a template.

Contract negotiations may span multiple turns of back and forth changes to the contract, each of which requires a review.

The advantages of automated contract review

Automated contract review tools can speed up this process significantly, saving time and money in the long run. Online contract review software automates many of the steps involved in contract review, from extracting contract data to quickly identifying potential problems. This can help streamline the legal process and reduce the risk of costly errors.

Automated contract review tools also allow users to collaborate digitally, with real-time updates on changes and progress. They provide a central hub for all parties involved in contract management, which can help ensure accuracy and consistency.

Artificial intelligence is the perfect answer to many challenges inherent to legal document management. AI-powered contract review solutions are able to analyze large amounts of data quickly and accurately, flagging any potential issues or discrepancies before they become major problems. They can mitigate risk, highlight key terms,

Key features of contract review software

There are a number of features to look for when selecting contract review software. Some of these include:

Change tracking

This feature allows users to quickly and easily identify changes made to the contract. Version control is crucial for reducing the time it takes to review a contract, and for ensuring accuracy. This feature also allows users to compare different versions of the contract for quick comparison.

Data extraction

Automated data extraction from contracts can help streamline the review process, saving time and resources. This feature enables users to quickly extract key data points from a contract, such as dates and deadlines. It can help reduce time spent reviewing contracts by eliminating the need to manually search for certain terms and conditions.

Workflow management

An automated workflow management system is extremely helpful for keeping all parties on the same page regarding the contract workflow. This feature allows users to assign tasks, set deadlines, and monitor progress in real time. It also helps reduce errors by providing visibility into who’s doing what at each stage of the process.

Approvals are an important element of the workflow during the negotiation process. Automated approval systems allow users to quickly and easily approve or reject changes in a contract, making the process more efficient and transparent.

Legal analysis

Contract review software should provide a comprehensive legal analysis of each clause, to ensure it meets all applicable laws and regulations. This feature is especially important for international contracts, as it can help identify potential issues that would not be discovered through manual review.

Legislation news tracking

This feature enables users to stay up-to-date on changes in legislation, ensuring that their contracts remain compliant. The software should be able to alert users of any new or updated regulations that could potentially affect the contract.

Natural language processing (NLP) technology for automated clause detection

NLP technology for automated clause detection makes it easier to quickly identify clauses and any potential discrepancies. By using sophisticated algorithms, this feature can detect clauses that may not be easily detected through manual review. This can help reduce the time required to review a contract and ensure accuracy.

AI-powered risk assessment tools

AI-powered risk assessment tools can be used to identify areas of risk within a contract and provide recommendations on how to address them. This can help reduce potential losses due to errors or changes, and ensure contracts are legally compliant.

Templates and forms

These can help ensure compliance with relevant regulations and improve accuracy in the contract review process. Using templates and forms can also help reduce the time it takes to review a contract, as users do not have to start from scratch.

Additionally, a template editor can be used to customize templates to fit the needs of a particular contract. This ensures that all necessary clauses and regulations are included in the review process, saving time and resources.

Integrations

Look for a contract review software that integrates with popular document management systems (e.g. Google Drive, Dropbox) and communication tools (e.g. Slack). This can help streamline the review process and ensure all parties have access to the most up-to-date version of the contract.

Browser-based highlighting

This feature allows users to quickly and easily highlight changes in the contract. This makes it easier to review contracts, as all changes are clearly visible. It also helps reduce mistakes by providing visibility into who is making what changes.

eSignature

eSignature technology makes it easier to sign contracts quickly and securely. This feature eliminates the need for manual signing, allowing users to eSign documents without having to print or fax them. It also helps ensure compliance with relevant regulations by providing an audit trail of all signatures.

Reporting

Reporting tools provide detailed analytics on the contract review process, helping users monitor and track progress. This can help improve accuracy and efficiency, as well as identify areas of improvement. Reports also provide visibility into who is responsible for each task in the review process, ensuring accountability.

Renewal reminders

Most contract review software platforms offer automated renewal reminders, which make it easier to stay on top of renewals. This feature can help ensure that contracts are not left open-ended or expired, reducing the risk of potential losses.

Storage

Secure storage is an important component of the contract review process, as it ensures contracts are stored securely and only accessible to authorized users. Look for a platform that includes cloud-based storage, which provides additional security measures and easy access from anywhere. Easy yet safe access to contracts is essential for maintaining accurate records and ensuring compliance.

Security

Finally, it is important to ensure contract review software has strong security measures in place. Look for features such as encryption and two-factor authentication, which protect sensitive information and prevent unauthorized access.  

Who uses contract review software?

Contract review software is used by a wide range of businesses and organizations, including legal departments, human resources teams, finance departments, and more. It is an invaluable tool for streamlining contract reviews and ensuring accuracy.

Legal teams

Legal teams in particular can benefit from automated contract review software. It allows them to quickly identify any errors or discrepancies, and ensure compliance with applicable laws and regulations. It also reduces the time required for manual review, helping legal teams stay on top of their workloads.

Sales teams

Sales teams can use contract review software to save time and resources, while also ensuring accuracy. It can be used to quickly identify any potential issues with a contract and provide guidance on how to address them. Automated contract review software can help sales teams close deals faster and more accurately.

HR departments

HR departments rely heavily on contracts for compliance and record keeping. Automated contract review can help HR departments quickly identify any potential issues with a contract, while also providing recommendations on how to address them. This can reduce the risk of legal action or other errors, as well as ensure compliance with applicable laws.

Finance departments

Finance departments have a great deal of responsibility when it comes to contract review. Automated contract review software can help them quickly identify risks and provide guidance on how to address them. This can reduce the risk of legal action, as well as saving time and money.

Types of contract review software

There are several different types of contract review software available on the market today. Some specialize in specific areas, such as reviewing contracts for compliance or financial purposes. Others focus on automating document management processes.

Examples of automated contract review software

Finding the best product for a given businesses' needs is no easy matter. A good overview of top contract review products can go a long way in supporting decision makers, helping them pick the best option for their team.

AnyLawyer

AnyLawyer is an automated contract review platform that helps users quickly and accurately review legal documents. Its AI-powered legal assistant provides recommendations on how to address any potential issues, answers legal questions, and detects risky clauses.

ContractExpress from Thomson Reuters

This cloud-based platform for automating contract creation and review.  It provides users with legal templates, drag and drop tools for customizing contracts, automated routing, and streamlined workflow management.

DocuSign

This platform offers a comprehensive suite of services for automating document signing and agreement management. It allows users to easily create signature-ready documents, securely send them for signature collection, track progress in real time, and store signed documents in the cloud.

HotDocs

HotDocs is an automated document assembly tool for drafting contracts quickly and accurately. It promises high efficiency, low risk, enhanced compliance, and improved quality in document management.

Agreement Express

Agreement Express is a comprehensive legal workflow automation platform that focuses on speeding up merchant onboarding to a 5-minute process. It offers contract data analytics that allow for more informed decisions, boosts sales, and automates underwriting.

ContractSafe

This cloud-based solution for managing contracts focuses on simplicity and promises affordable pricing plans. Instead of multiplying its features, ContractSafe offers the most important basics, such as reporting, alerts, and a repository. Users can get started quickly, as the tool is easy to learn and use.

Juro

Juro helps users draft and negotiate contracts with the help of AI-driven templates. It offers features such as automated data capture, legal guidance powered by natural language processing, and real-time collaborative editing.

Modern contract management

Contract review software and automated contract review can be invaluable tools in the legal process. They help save time, reduce errors, and enable collaboration between parties.

When considering various AI solutions available today, it is easy to fall for the hype and lose sight of business value and goals. We recommend researching what each tool is capable of, how easy it is to use, and what it might be lacking before making a decision. It is also crucial to adapt existing processes to take full advantage of automated contract review.