The Benefits of Contract Management and Abstraction Services
Today’s corporate legal departments are looking to streamline and improve their contract management processes. In many cases, it makes good business sense to engage a Legal Process Outsourcing (LPO) provider to manage legal service contracts, agreement drafting, legal contract review and legal document review work.
Contract Management Outsourcing Services
LPO service providers offer governance, compliance and risk management solutions that enable corporations to avoid or lessen business and reputational risks. Some of the most commonly outsourced contract management processes include:
• Contract discovery and audit services
• Contract summary, redlining, drafting
• Contract abstraction
• Governance, risk and compliance
• Management reporting services
• Online contract repositories
• Alerting and notification services
• Claims and dispute management
Managing and Abstracting Legal Contracts
Legal departments and law firms alike have hundreds or thousands of paper contracts stored in file cabinets or saved as spreadsheets. This type of storage system is cumbersome and does not ensure that key dates and payment terms are met and that certain key terms or clauses are implemented. The process of manually storing, monitoring, mining and managing contracts is time-consuming, expensive and fraught with risk. By outsourcing this function to an LPO provider that specializes in contract management and abstraction services, you can stay on top of the data contained in these contracts. Because LPO providers employ the latest technologies to carry out this process effectively, they are able to deliver abstracted documents to legal clients accurately and quickly.
Benefits of Contract Abstraction
Contract abstraction involves extracting important dates, clauses, and other pertinent information from paper documents. This type of “legal coding” works by tagging all the important terms, Meta Data, etc. in each contract. When dealing with lengthy and complicated contractual documents, contract abstraction provides a concise view with all the significant points highlighted such as date, party name, expiration, renewal and more. This saves precious time and resources, thereby increasing internal productivity and ensuring legal compliance across the contract lifecycle.
Also, through contract abstraction documents are easier to understand for non-lawyers because important clauses and guidelines are brought to the forefront. As a vital business function, contract management becomes more accessible and predictable for all.
In essence, contract abstraction helps companies make informed decisions about the contracts they sign. When the contracts are abstracted, the essential details that mark the importance of a legal document come to light.
A True Competitive Advantage
Contract management has become a core competency critical to a company’s ability to operate efficiently and reduce legal risk. Organizations with mature contract management processes have a distinct competitive advantage, and they are looking to partner with Legal Process Outsourcing providers to manage this essential activity.