Contract Analysis
Contract Analysis

How to Leverage Contract Analysis to Improve Your Contracting

Peter Thomson |

If your business is like most enterprises, contract data represents a precious but largely untapped resource. If you knew that rich deposits of gold rested just below your feet, you’d probably grab a pick and start digging.

Contract analysis offers  such an opportunity for legal and business teams ready to see the gold mine on which they are sitting. Contract analysis offers powerful risk mitigation by looking at the outcomes of prior contracts.

But the benefits of contract analysis go much further than simply lowering legal risk. Contract analysis can also yield new strategies for improving your overall contract process, preventing revenue and cost leakage and much more.

Understanding contract analysis

What if you could predict risk and mitigate risk across contract channels to secure long-term benefits? What if you could open up all of your contracts to searchability? Or, what if you could instantly figure out where contracts are getting stuck to improve workflows?

With contract analysis, you can. All of those contracts gathering dust in “the cloud” or old repositories are rich in predictive data and key terms. You just need to unlock them.

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With AI and deep learning mechanisms, those old contracts can be used to predict risk, expose loopholes, and secure texts without the necessity for years of manual pour-over. This new wave of risk mitigation that utilizes AI to analyze contract terms and provide deep insight into incentives, indemnifications, clauses, policies, and liabilities, leverages risk mitigation as a predictive element, which ultimately feeds back into your workflow leading to better accuracy, reduced risk, and increased revenue.

In short, contract analysis leverages your existing corpus of contracts for data insights that can make your contracts and the process of creating them better. It’s like having X-ray specs for your contracts.

How does contract analysis work?

Contract analysis is intrinsically connected to AI. Machine learning algorithms have the ability to pull apart thousands of contracts rapidly and use that information to highlight specifics and introduce process changes. So, the process begins with an AI de-constructing your contract archive (post-sign and in-process) and mapping sections of each contract against templates using natural language processing.

Hundreds of thousands of existing contracts (and millions of data points) will be used to show where your contracts have specific language issues, which will show you where your contract language differs from existing languages, and whether or not that may be a potential liability.

This process will uncover details about where terms and conditions differ across contracts. Of course, contract analysis can also follow ongoing contracts and issue alerts when specific events transpire (terms are broken, expirations, etc.) During this process of “mapping” contracts, key terms become explorable, meaning that existing contract details can be searched readily and used across contract channels (non-payment exposure, etc.)

In short, contract analysis uses existing contract templates to alert you to any suspicious contract language while simultaneously de-construction contracts, thereby making key terms explorable and opening contracts up to further analysis across channels. This means contract analysis lets you predict risk before it happens.

The key benefits of contract analysis

Let’s go over some of the ways that contract management can disrupt your current legal ecosystem. There are plenty of ways that contract analysis can transform your businesses contracting process, but we’ll narrow it down to a few that are easily digestible.

To better understand contract analysis, it’s important to think of it as an overarching contracting restructuring as opposed to a nifty tool. It will significantly change the way that you handle contracts, both current and past. It will also give you the agility to better upgrade your workflow and the insights to reshape your legal ecosystem.


The process of comparing contracts against an existing database of contracts opens up some incredible insights into risk. Depending upon the exact AI used, you’ll receive a list of highlights that will trigger any potential risk factors associated with legal language. This means specific clauses can be measured against industry standards and touched up to eliminate loopholes or confusing regulatory language. So, instead of spending a few hours reviewing a contract by hand, AI can instantly dissect that contract with greater accuracy and more profound results.


Not only does AI help find potential loopholes, but it also opens existing contracts up to explorability by dissecting elements and standardizing them to rich keywords. This makes contracts more easily searchable across channels and gives anyone the ability to dig into contracts without having to manually search for specifics such as non-payment risks. This process helps reduce redundancy and improve contract visibility.

Example: With VertragRaum, you can search for every contract with a specific vendor, every contract that contains a specific legal loophole, or even search obligations within an entire family of contracts. Contract analysis lets you get granular and pour through contracts instantly.


This process of uncovering hidden clauses, revenue hotspots, legal loopholes, and potential threats, gives organizations an incredible amount of analytic agility within their contract framework. Clauses can be instantly reworked and matched to existing templates without sacrificing time and maneuverability. While this certainly means that risks are found and dealt with more rapidly, it also means that contracts become analytic hotspots of rich data that can be used to further improve processes.

Improved agility

This process of uncovering hidden clauses, revenue hotspots, legal loopholes, and potential threats, gives organizations an incredible amount of analytic agility within their contract framework.

The result of contract analysis is improved agility organization-wide. The ability to recognize issues within purchases, terms and conditions, business agreements, and non-disclosure agreements while simultaneously opening contracts up to be further searched, refined, and analyzed, gives organizations the ability to amend existing contract issues, improve contract relationships, and increase revenue streams.

The end result is that tools like VertragRaum give you a strategic contracting process that leverages advances in technology to enhance existing contract ecosystems.

Tying it all together

In summation, contract analysis leverages both content data and process data from your existing contracts to give you insights that can reshape your processes going forward. This process breaks down existing contracts into explorable terms that you can leverage to improve speed and cut down on redundancies.

Contract analysis is impactful organization-wide and helps mitigate risks before they happen (i.e., predictive risk mitigation.) This process will help businesses redefine their contracting goals and restructure their workflows. Leveraging technology to reduce mundanity while improving accuracy is reshaping the legal landscape, and processes like AI-powered contract analysis are disrupting the industry and creating new standards along the way. Contract analysis lets you get more done faster with fewer resources.

If you’re interested in learning more about contract analysis, or you would like to know how contract analysis will fit into your current ecosystem, Kontaktieren Sie uns heute.

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