AI in Contract Lifecycle Management

From streamlining routine tasks to enhancing visibility and reducing risk, artificial intelligence (AI) is reshaping contract management at every stage. 

Let’s explore the role of AI in Contract Lifecycle Management (CLM), highlighting the key ways it enhances the process, the benefits it delivers, and the challenges legal and business teams should consider when adopting AI-powered CLM solutions.

The Role of AI in CLM

AI in contract lifecycle management (CLM) helps support legal professionals in doing their jobs efficiently. By applying machine learning (ML) and natural language processing (NLP) to contract workflows, AI enables legal teams to engage in faster decision-making, improved accuracy, and better oversight. 

Instead of legal teams spending hours reviewing documents or tracking down details, AI can quickly pull out key information, spot risks, and suggest the right clauses based on what’s been used before.

And while AI can’t replace lawyers, it does give legal teams better tools so that AI can handle repetitive tasks, flag issues early, and help make sure nothing slips through the cracks. With AI, contracts progress more smoothly, and legal teams get time back to focus on higher-value work.

Key Ways AI Enhances the Contract Lifecycle Process

AI can support every stage of the contract lifecycle, from the moment a request comes in to when it’s time for renewal. Here’s how it helps along the way:

• Intake & Triage: AI can automatically sort and route contract requests to the right person or workflow, so nothing gets stuck or missed.
• Drafting: It can suggest contract language based on past deals, helping teams build first drafts faster and more consistently.
• Review & Negotiation: AI can flag unusual terms, compare against standard clauses, and highlight potential risks, making reviews quicker and more accurate.
• Execution: Smart reminders and integrations with e-signature tools help move contracts across the finish line without delays.
• Renewal & Obligation Management: AI can track key dates and commitments, sending alerts when action is needed so deadlines don’t get overlooked.

Each of these steps becomes faster, more accurate, and easier to manage when AI takes on the heavy lifting.

Benefits of AI-Powered CLM

Bringing AI into your contract management process comes with real, measurable benefits. Here are some of the biggest advantages:

⏱️ Faster Turnaround Times

‍Contracts move through drafting, review, and approval much more quickly, cutting delays across teams.

✍️ Less Manual Work

‍AI takes care of repetitive tasks (i.e. pulling data, checking terms, or routing requests), so legal can focus on more strategic work.

👀 Better Visibility

‍With AI analyzing and organizing contract data in real time, it’s easier to see what’s in the pipeline, where things are stuck, and what’s coming up.

⚠️ Lower Risk

‍AI can flag non-standard clauses, missing approvals, or upcoming deadlines before they become issues.

💡 Smarter Decisions

‍With better data and clearer insights, legal and business teams can make more informed calls, faster.

In short, AI helps legal teams work more efficiently, collaborate better with the business, and stay ahead of risk.

Challenges & Considerations When Using AI in CLM

As powerful as AI can be in contract management, it’s important to approach implementation with clear expectations. 

First, data quality plays a big role. So, if your contract data is scattered, outdated, or inconsistent, the AI’s insights won’t be as accurate or helpful. Adoption is another factor. While AI can simplify workflows, getting teams to trust and rely on it takes thoughtful rollout, training, and change management.

It’s also worth noting that not every part of the contract process can or should be automated. Some contracts require human judgment, especially during negotiation or when handling more complex terms. 

Finally, any AI tool used in CLM must meet your company’s privacy, security, and compliance standards, particularly when working with sensitive legal documents. These challenges don’t outweigh the benefits, but they do need to be considered upfront to ensure long-term success.

Key Takeaways

AI is changing the way contracts are managed by making processes faster, smarter, and less manual. From intake and drafting to negotiation and renewal, AI helps legal teams stay on top of their work, reduce risk, and free up time for more strategic priorities. 

While there are a few challenges to keep in mind, the benefits of AI-powered CLM are clear for teams looking to streamline operations and scale their impact.

Curious how AI can simplify contract lifecycle and matter management for your team? Book a demo to see how Checkbox uses AI to streamline intake, automate workflows, and provide real-time visibility.