Leading a legal team can be challenging, especially when contracts pile up and deadlines loom. Contract analytics transforms legal operations from reactive to proactive, helping predict busy periods, identify bottlenecks, and manage workloads efficiently. 91.9% of organizations see measurable value from data and analytics investments. For legal teams, this means better planning and resource allocation.

In this post, you will see how contract analytics helps forecast legal needs, manage workloads, and optimize resources, transforming legal team operations from good to great.

What is contract analytics?

Contract analytics digs deep into your contract management process, from start to finish. It helps you spot inefficiencies, streamline workflows, and make sure everything is compliant. 

Contract analytics gives you actionable insights that can transform how you handle contracts, making the contracting process smoother and more efficient.

Benefits of contract analytics

#1 Identify bottlenecks and optimize every step of the contract lifecycle

Contract analytics enables you to identify delays and inefficiencies throughout the contract lifecycle. By pinpointing these bottlenecks, you can implement targeted solutions to streamline the process and expedite contract completion.

#2 Improve compliance by tracking adherence to approval SLAs

Compliance is crucial in contract management. Contract analytics tracks how well you adhere to Service Level Agreements (SLAs) for approvals. This ensures that all contracts meet regulatory and organizational standards, reducing the risk of non-compliance and potential fines. 

Regular monitoring and automated alerts help maintain high compliance standards, ensuring your legal processes are always up to date with current regulations​​.

Also read: How to Use Contract Analytics Software to Uncover Insights

#3 Close deals faster by optimizing contracting processes

By identifying and eliminating inefficiencies, contract analytics helps you close deals faster. Optimized contracting processes mean that contracts move through the pipeline more quickly, enabling your business to capitalize on opportunities sooner.

How does predictive analytics help?

Predictive analytics uses data, statistical algorithms, and machine learning techniques to predict future outcomes based on historical data. In legal analytics, predictive techniques help forecast case outcomes, identify trends, and improve decision-making.

#1 Predicting contract approval times based on contract value

By understanding how different variables relate, you can predict how long it will take for contracts to get approved. For example, if contracts worth more than $1 million typically take 30 days to get approved, while those under $1 million take only 10 days, regression analysis can help you forecast that high-value contracts will generally face longer approval times.

#2 Estimating the likelihood of contract approval delays

Categorizing data helps you predict outcomes, like which contracts might be delayed. For instance, if you sort contracts based on their complexity or value, you might find that contracts over $500,000 have a 70% chance of facing delays, while those under $500,000 have only a 20% chance. This helps you anticipate delays and manage your workflow better.

#3 Recognizing trends in contract approval delays

Grouping similar data together helps you spot patterns. For example, if you cluster contracts by characteristics such as value or department, you might discover that contracts from the finance department valued over $200,000 are delayed 50% of the time, whereas contracts from the marketing department are only delayed 10% of the time. This insight helps you address the root causes and improve the process.

#4 Predicting future approval times based on historical data

Looking at data over time helps you see trends and make forecasts. By analyzing past contract approval times, such as finding that the average approval time has increased by 5 days each quarter for the last year, you can predict that future contracts might take longer to process. This helps you set realistic expectations and plan better.

Mastering trend analysis in legal operations

Understanding and analyzing trends in legal data can significantly improve your operations. By identifying patterns, you can make informed decisions and adjust your strategies to stay ahead.

#1 Tracking and optimizing contract process times

Track the time taken for approval, redlining, and execution stages in the contract process using contract analytics. Compare these times against your organizational SLAs to identify deviations and ensure compliance. This helps streamline your processes and improve efficiency.

Also read: Leveraging Contract Analytics for Legal Process Optimization

#2 Adjusting legal strategies based on trend data

Leverage trend data from contract analytics to refine your legal strategies. If you notice longer approval times, streamline the approval process or allocate more resources. Proactively adjusting strategies based on trends keeps your operations efficient and effective. For example:

• Contract processing: Simplify standard clauses if redlining times are increasing
• Client relations: Develop tailored strategies for clients with longer negotiation times

#3 Using time-series data for better resource forecasting

Time-series data from contract analytics helps you visualize workload fluctuations throughout the year. This insight allows you to forecast resource needs more accurately and ensure adequate staffing during peak periods.

Top tools for predictive analytics in contract management

There are some great tools out there for contract analytics. We'll explore the most popular ones that can enhance efficiency, accuracy, and compliance in your legal operations.

These tools does not list specific pricing on their website. Interested users need to contact them directly for a quote based on their specific needs and usage.

#1 SpotDraft

SpotDraft Contract Analytics provides comprehensive tools to help you manage and optimize your contract processes. Designed to simplify and enhance contract management, SpotDraft uses data-driven insights to improve efficiency, reduce delays, and ensure compliance. SpotDraft Contract Analytics offers the clarity and control you need to streamline your operations and make informed decisions.

Features:

• Four out-of-the-box dashboards

SpotDraft's contract analytics has four dashboards that make your job easier. The lifecycle dashboard tracks the whole contract process, so you can spot any bottlenecks quickly. The approvals dashboard keeps an eye on approval times and identifies where delays happen, helping you speed things up. The review dashboard looks at how long reviews take and common issues, making the review process smoother. The turnaround time dashboard breaks down the time taken for each stage, so you know exactly where you can improve speed.

• Pre-built charts

SpotDraft gives you pre-built charts that provide clear visual insights. Performance charts let you see how your contracts are doing against benchmarks. Trend analysis charts show you trends over time, which helps with forecasting. Compliance charts keep track of how well you’re sticking to standards. These charts turn complex data into something you can easily understand and act on.

• Filters

SpotDraft's advanced filters let you customize your views. You can filter by date ranges to see trends over specific periods. Check how different contract types are performing, or track the activity of specific users or teams. You can even analyze contracts with particular partners. These filters help you focus on what matters most to you.

Benefits

• Quick identification of bottlenecks: Streamline the contract process
• Faster approvals: Highlight and address delays promptly
• Simplified review process: Reduce issues and speed up reviews
• Improved speed: Measure and enhance the efficiency of each stage.
• Track performance against benchmarks: Understand how contracts are performing
• Better forecasting: Identify trends over time
• Ensure compliance: Track adherence to standards and regulations
• Customized views: Filter data by date, contract type, user activity, and counterparties for focused analysis

‍Showing leadership how busy we are in terms of contract request types helps us provide rationale to hire more support staff” - SpotDraft customer

#2 Kira Systems

Kira Systems uses advanced machine learning to enhance contract review processes. It helps legal teams by identifying, extracting, and analyzing contract content quickly and accurately, facilitating efficient due diligence and compliance checks.

Features:

• Machine learning for contract review: Utilizes advanced machine learning algorithms to identify, extract, and analyze content within contracts
• Due diligence: Facilitates thorough and efficient due diligence processes
• Compliance: Helps ensure regulatory compliance by highlighting key terms and clauses
• Quick study: Allows users to train the system to recognize custom clauses and provisions specific to their needs
• Real-time collaboration: Enables teams to work together on contract analysis in real-time
• Flexible project management: Provides tools for managing large-scale contract review projects efficiently

Benefits:

• Increased accuracy and efficiency: Reduces the time needed for contract review while increasing accuracy, thereby freeing up legal teams to focus on higher-value tasks
• Risk mitigation: Quickly identifies potential risks and compliance issues within contracts
• Scalability: Suitable for both small firms and large enterprises, making it a versatile tool for various industries including law firms, corporations, and consulting firms
• Enhanced visibility: Provides a comprehensive view of contract terms and risks through detailed reports and dashboards

Cons:

• Complexity: The advanced features may require a learning curve for new users

#3 LawGeex

LawGeex leverages AI to automate contract review, ensuring consistency and compliance with company policies and industry standards. It provides real-time insights and facilitates collaboration to streamline the contract process.

Features:

• Automated contract review: Uses AI to automate the review of contracts, comparing them against company policies and industry standards
• Benchmarking: Compares contract terms against industry benchmarks to ensure compliance and competitiveness
• Integration: Seamlessly integrates with existing document management systems and other legal tech tools
• Real-time insights: Provides instant feedback on contract terms and potential issues.
• Collaboration and workflow tools: Facilitates team collaboration with tools for tracking changes and managing approvals

Benefits:

• Consistent and thorough review: Ensures every contract is reviewed to the same high standard, reducing the risk of human error
• Time savings: Significantly reduces the time required for contract review, enabling faster turnaround times
• Cost-effective: Reduces the need for extensive manual review, potentially lowering legal costs
• User-friendly interface: Designed to be easy to use, even for those without extensive technical expertise

Cons:

• Initial setup: May require significant setup time to integrate with existing systems and train the AI on company-specific policies
• Limited customization: Some users may find limitations in customizing the system to fit very unique contract types or clauses

#4 Seal Software

Seal Software uses advanced AI for contract discovery and analysis. It automates the extraction of key data and clauses, providing in-depth insights into contract terms and risks.

Features:

• Contract discovery: Automatically discovers contracts across various repositories.
• Data extraction: Extracts key data and clauses from contracts using advanced AI.
• Advanced analytics: Provides in-depth analysis and insights into contract terms and risks.
• Machine learning and natural language processing (NLP): Leverages ML and NLP to improve the accuracy of data extraction and analysis.
• Integration capabilities: Easily integrates with other enterprise systems for seamless data flow.

Benefits:

• Enhanced visibility: Offers detailed insights into contract portfolios, helping organizations manage risks and opportunities
• Risk management: Identifies and mitigates potential risks by analyzing contract terms
• Compliance: Helps ensure contracts comply with relevant regulations and standards
• Improves decision-making: Advanced analytics offer insights that help in making informed business decisions
• Saves time and resources: Automates the discovery and extraction process, saving time and reducing manual effort

Cons:

• Complex implementation: May require a significant investment of time and resources to implement and integrate with existing systems
• Cost: The comprehensive features and capabilities may come at a higher cost, potentially limiting accessibility for smaller organizations

Unlock predictive power with SpotDraft's contract analytics

Let's face it, leading a legal team can be tough. Contracts pile up, deadlines loom, and it feels like you're always playing catch-up. But with SpotDraft's contract analytics, you can transform your legal operations from reactive to proactive.

With this feature, you can track key metrics, predict future requirements, and stay ahead of trends. 

Try SpotDraft’s contract analytics today!