ContractPodAi is a customer of Business Reporter.
As businesses adapt to the constantly changing business world, the saying “innovate or stagnate” becomes relevant. Artificial intelligence (AI) has become a game-changing factor, with 64% of companies expressing hope in its ability to increase productivity. This percentage reflects the increasing trust that businesses have in AI.
Utilizing Generative AI, specifically, is becoming increasingly useful in simplifying contract management and directly influencing business success. Here are three methods in which Contracting with Gen AI can enhance your company’s profits:
Providing enhanced productivity
According to participants in a study of legal departments in various fields, incorporating a contract lifecycle management (CLM) system with generative artificial intelligence (AI) capabilities can result in a noteworthy boost in effectiveness. Such technology can also alleviate delays in contract signings caused by limited staff and heavy workloads. Additionally, internal delays are reduced by almost 10%, highlighting the immediate productivity benefits. The use of AI-driven templates and suggestions in the CLM process brings a groundbreaking approach to contract creation, review, and analysis, streamlining and expediting these intricate tasks.
Gen AI incorporates AI-powered contract templates, which are dynamic and continuously adapt to changing legal nuances and industry-specific needs. Additionally, Gen AI goes beyond basic templating by providing intelligent recommendations during review and analysis. By analyzing large datasets, its algorithms offer valuable insights and suggestions, improving the decision-making capabilities of legal experts. This innovative use of AI not only speeds up contract-related tasks but also improves their precision and effectiveness, representing a major advancement in the realm of legal technology.
Improving the efficiency of a building while also reducing costs.
It is important to examine the financial effects of implementing Gen AI technology in contract processes. A study by McKinsey & Company revealed that large companies could experience a 2% loss due to unfulfilled commitments. For a business with a yearly spending of $2 billion, this would result in an annual loss of $40 million. Additionally, teams without automated agreement methods are 75% more likely to miss contractual obligations. However, using Gen AI can help solve these issues by automating routine tasks, expediting the time it takes to finalize agreements, and improving management of contractual obligations.
Incorporating Gen AI into contractual procedures helps boost profits by automating mundane tasks. This allows staff to shift their attention to important projects, driving the business forward rather than getting weighed down by administrative duties. Additionally, this increased efficiency has a beneficial impact on clients and vendors, leading to a less stressful experience for them.
Using Gen AI in the contract process speeds up the time it takes to get signatures, improving customer relations and making negotiations easier for everyone involved. Gen AI can also refer to previous contract terms, ensuring consistency in agreements and making the overall process faster. This feature reduces the chances of mistakes and helps build stronger relationships with vendors and customers, highlighting the value of Gen AI in streamlining contract procedures.
Mismanagement of contractual obligations for customers, suppliers, or one’s own business can have a significant impact on resources. It is crucial for companies to ensure they are not paying more than necessary or receiving inadequate compensation. With the help of Gen AI, specific clauses can be identified and linked to automated tasks and important dates for efficient tracking and management (such as renewals or price increases). The system’s task lists, dates, and tables can effectively monitor a variety of contractual obligations.
Gaining a competitive edge
As reported by Forbes Advisor, 64% of entrepreneurs have a positive outlook on the potential impact of AI on improving customer relationships. This highlights the growing recognition of AI as a valuable tool for enhancing the overall customer experience.
In a competitive market, one negative service experience causes 61% of customers to consider switching to a different company. This drives businesses to prioritize making their processes simpler and more convenient, particularly in important areas like managing contracts. The general consensus is that in order to thrive in this environment, businesses must recognize the significant impact of AI on creating positive interactions with customers.
The progress of technology is changing the way industries operate, and companies that do not incorporate Gen AI technologies risk being left behind by their rivals. Gen AI is not just a passing fad; it is a transformative power that could redefine markets and alter consumer demands. Not embracing and implementing Gen AI into business practices could lead to missed chances, inefficiencies, and ultimately, a decrease in competitiveness. As the business world continues to develop, Gen AI plays a crucial role in setting businesses apart and either propelling them forward or causing them to struggle to keep up.
Looking forward
According to research conducted by Grand View Research, the use of artificial intelligence is expected to greatly impact many industries, with a projected annual growth rate of 37% from 2023 to 2030. This rapid growth highlights the increasing importance of Gen AI technologies.
The emergence of Generation AI enables businesses to quickly experience the advantages of a streamlined, cost-efficient, and competitive contract procedure. Generation AI offers a prompt solution to troublesome manual procedures while also strategically laying the foundation for a stronger CLM system, if necessary for your business.
Although there are concerns about the use of AI, most customers still have faith in businesses that incorporate this technology. By implementing AI in a responsible and transparent way, companies not only maintain trust with consumers but also utilize AI’s capabilities to improve customer experiences.
Investing in Gen AI-powered contract operations provides instant benefits for all types of businesses, including start-ups, scale-ups, and established companies. This investment has been proven to be a valuable expense.
Source: independent.co.uk
