Hours spent over drafting, negotiating terms, reading and rereading documents, sending documents back and forth, managing changes in different versions of contracts; these are some of the realities for contract managers and legal executives. Most big energy companies execute thousands of contracts each year, resulting in millions of pages of documents. The legal profession has been slow to embrace digitalization and technology. Legal tech solutions are now helping professionals better understand, maintain and manage contracts. Technology has made life easier for lawyers and contract managers by reducing the time spent on the time-consuming logistic-tasks in contract management, freeing up professionals to focus on the actual matter at hand.
Manual contract analysis is not only cumbersome and time-consuming but also prone to human-errors. As contracts are primarily text documents, advanced systems are now capable of extracting legal terminology and key data from long contracts, just in a matter of seconds. Tools are able to do in seconds what traditionally took lawyers or contract managers several hours or days of pouring over clauses. The use of data analytics is helping organizations identify the type of contracts they execute most frequently and optimize their processes to become more efficient, saving time and resources being spent on ‘reinventing the wheel’ each time contracts of similar nature are negotiated, drafted and executed. Legal tech is enabling organizations to keep processes standardized, collaborate across resources and clients, cut costs through automation, and keep track of deliverables.
Natural Language Processing (NLP) and machine learning tools are now able to use the results of previously executed contracts to optimize contract terms and terms. As with any form of machine learning, the more the number of samples of contracts and information and results attached to them made available to the system, the better the system could become in automating parts of the process.
As contract management becomes increasingly digitalized, the question of security is one of the first to arise. Contracts often contain highly sensitive information, which must not be compromised by any means. How do you ensure that the information in your contracts is not compromised? Encryption, secure logins, access controls all work well until they are compromised; security systems need to constantly innovate and update to keep up with the evolving world of cyberattacks.
The wealth of information in the form of contracts that are stored away in repositories is huge, and so are the benefits of subjecting these data to analytics. Analyzing all this stored information to derive actionable insights, including the factors that contribute to successful contracts and the factors that contribute to an unsuccessful one, would help decision-makers in organizations make informed decisions.
The 4th EPC Project & Contract Management for Energy Sector will gather senior decision-makers from Construction, Legal, Contract, Risk & Procurement divisions of leading Energy companies to discuss and benchmark best practices to gain efficiency and increase ROI by tackling project complexity, rising costs and various risks.