How AI is Making Contract Management Easier and More Effective

© 2012-17 SirionLabs Pte. Ltd. The contents of this presentation are proprietary and confidential. 1
Featuring
LIVE WEBINAR
How AI is Making Contract
Management Easier and More
Effective
May 14, 2020

2© 2012-20 SirionLabs Pte. Ltd. The contents of this presentation are proprietary.
Before we get started
THE HOUSEKEEPING ITEMS:
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What will be covered today
Current state of AI in contract management
How AI addresses the traditional barriers across the contract management lifecycle
How AI-powered contract management is making businesses stronger and more
successful

Featured Speaker
Andrew Bartels
VP, Principal Analyst
Forrester
Ajay Agrawal
Founder and Chairman
SirionLabs
Host

How AI is Making Contract
Management Easier and
More Effective
M a y 1 4 , 2 0 2 0
Andrew H. Bartels
VP and Principal Analyst

6© 2020 Forrester. Reproduction Prohibited.
Business runs on contracts …
So contracts have to be created by business and made accessible to business,
while still retaining legal controls

Contracts play two roles in business
1. Contracts define who
does what at what price
when everything works as
planned
2. Contracts define who is
responsible or liable when
things don’t work as
planned
95% of daily contract
value;
50% of ultimate contract
value;
10% of contract language
5% of daily contract
value;
50% of ultimate contract
value;
90% of contract language

A contract repository is just one stage in the
lifecycle of a contract
License
Revenues
2
1
3
4
5
6
Contract
optimization
Contract renewal
Contract
compliance and
administrationContract
storing and
repository
Third-party
contract
importing
Contract
drafting and
negotiation
Contract
lifecycle
management
(CLM)
software
handles the
whole lifecycle

CLM helps firm manage the contract lifecycle
• Support for all stages of a contract, from drafting to negotiation to execution and
management to replacement
• Support for all kinds of contracts: buy-side contracts, sell-side contracts,
employment contracts, intellectual property contracts, etc.
• Word document interface for easy adoption by lawyers and employees, as well
as browser interface for adoption by employees
• Contract repository tied to transaction systems for purchasing and order
management to check purchased product price and terms against contract
• Contract analysis and reports
• Contract import tools and capabilities
• Linkage to related process applications for buying, selling, or other partner
activities
© 2011 Forrester Research, Inc. Reproduction Prohibited

CLM solutions have three business benefits
1. Efficiency improvements (productivity gains, faster cycle
times)
2. Effectiveness improvements (risk mitigation, avoidance
of the wrong contract actions)
3. Hard monetary benefits (performance and payments
directly to contract terms)

CLM solutions deliver these value in six stages
1. All contracts in an
electronic repository
(Cut costs of finding contracts, tracking renewals)
2.Analysis and reports of contracts
(Identify duplicates, conflicts, obligations, and rights)
3. Automate contract creation
(More efficient use of legal staff, faster cycle
times, acceleration of revenues or savings)
6. Improved contract optimization
(Maximizing business value from contracts)
5. Integrate transaction systems to
contractual terms and conditions
(More complete and effective compliance
with contractual benefits and commitments)
4. Connect with upstream apps
(More efficient use of employee time)

But CLM presents challenges at each stage
1. All contracts in an
electronic repository
2.Analysis and reports of contracts
3. Automate contract creation
6. Improved contract optimization
5. Integrate transaction systems to
contractual terms and conditions
4. Connect with upstream apps
• Finding all current contracts
• Importing and meta data tagging of contracts
• Selecting and configuring standard reports
• Creating custom analytics of contract portfolio risks,
entitlements, and obligations
Stages Challenges
• Creating library of standard terms and conditions
• Setting up rules for what can and can’t be changed
• Designing workflow for routing changes to right person
• Linking eSignature
• Identifying relevant upstream apps
• Integrating and creating common user interface
• Securing funding for integration to transaction systems
• Integrating with transaction systems
• Having fully automated contract compliance with
transaction systems
• Comparing expected business results with actuals

AI functions can help address these contract
management challenges
AI can help overcome difficulty in (declining order of value):
1. Importing contracts, especially third-party contracts
2. Running reports and analysis on topics for which we have not created
metadata tags
3. Integrating our CLM system to transaction systems like order
management or procurement for automating contract compliance
4. Managing unanticipated risks in the contracts (e.g., GDPR compliance)
5. Determining if our contracts are meeting our business objectives
6. Guiding employees to the right contract for their purposes
7. Streamlining business and legal working together to approve deviations
from standard contract language

What is artificial intelligence (AI)?
AI technologies mimic humans'
abilities to sense, think, and act
• Sensing AI includes human recognition
and machine recognition
• Acting AI includes virtual agents, natural
language generation, robotic process
automation, and expert system decision
management
• Thinking AI includes knowledge
representation, rules engines, machine
learning, text analytics, natural language
processing, and text analytics
Forrester Research, Inc., “TechRadar™: Artificial Intelligence Technologies, Q1 2017 »

To address these gaps, CLM vendors are adding are
range of AI features and functions to their products
Forrester Research, Inc., survey of ePurchasing and CLM vendors
15%
15%
23%
31%
38%
46%
62%
62%
62%
69%
77%
77%
85%
85%
92%
Other (e.g., expert system, voice translation)
Image and video analysis
Speech recognition and analysis
Pre-trained vertical solutions
Natural language generation
Deep learning platforms
Intelligent research solutions
Robotic process automation
Virtual agents
Intelligent recommendation solutions
Text analytics and natural language processing
AI-enhanced analytics solutions
Semantic analysis
Decision management
Machine learning platforms
Which artificial intelligence tools and systems are you investing in?
N = 13 CLM vendors

AI innovations in contract repositories and
reporting and analysis
AI innovation #1 – importing legacy and third-party contracts
• Innovation: use natural language processing and machine learning to import
contracts and attach meta-data tags to the relevant terms and conditions
• Innovation: extracting the business end of the contract - What (deliverables,
milestones, obligations), How (SLs, KPIs) and How Much (Rate card, Price books)
AI innovation #2 – identifying compliance or risk issues in contract
portfolio
• Innovation: use semantic analysis and natural language processing to find clusters
of relevant words relating to an issue across the contract portfolio
AI innovation #3 – reporting and analysis of unanticipated issues
• Innovation: use AI-enhanced analytics to create ad hoc reports on any new
question or concern

AI innovations in contract creation and negotiation
AI innovation #1 – helping users create the right contract
• Innovation: using text analysis, natural language processing, and decision
management to engage with users and guide them to the right contract terms and
conditions for their business need
AI innovation #2 – getting rapid decisions on deviations from standard
contract terms and conditions
• Innovation: using robotic process automation to determine which deviations can be
approved automatically or routed to the right person for review

AI innovations in contract integration and
management
AI innovation #1 – link CLM to transactional systems
• Innovation: using AI to set up application programming interfaces (APIs) to
integrate CLM data into procurement systems or order management systems
that need the data for automated compliance
AI innovation #2 – identify all data needed to manage contract
execution
• Innovation: Automated workflows to facilitate and track completion of service
levels and performance obligations
• Innovation: Automated performance and invoice validation
• Innovation: Granular tracking of regulatory and policy compliance obligations
• Innovation: Management and tracking of governance issues and action items

Contracts link to many different process apps
eSourcing
Buy-side
contracts
Sell-side
contracts
Project
Mgmt.
eInvoicing
Risk
Mgmt.
CPQ
SFA
Revenue
Mgmt.
Order Mgmt. eProcurement
Proposal
Mgmt.

AI innovations in contract optimization
AI innovation #1 – make sure we get full contract compliance
• Innovation: after linking CLM with transaction systems, applying diagnostic
analytics to identify contract leakage or instances of contract noncompliance
AI innovation #2 – make sure our contracting process is optimal
• Innovation: using process analytics and robotic process automation to
identify and remove bottlenecks and delays in the contracting process
AI innovation #3 – make sure our contracts are accomplishing our
business goals
• Innovation: applying predictive analytics to compare actual business results
against predicted results

Forrester’s framework for assessing AI maturity
Maturity level in
human terms
The vendor’s offering
Pre-K Vendor has AI functions on its road map
Kindergarten Vendor has AI functions in development
3rd Grade Vendor has AI functions in test with a few clients
8th Grade Vendor has AI functions in its product in the market
for a year or so
11th Grade Vendor has AI functions in its product in the market
for two-three years
College Vendor has AI functions in its product in the market
for four years or more

Contract
initiators
• Who: salespeople,
purchasers, deal
makers
• Goal:
Get contracts
signed quickly
• Need:
Ease of use,
link to other apps
they use,
eSignature
integration
Contract
reviewers
• Who: legal; sales
or purchasing
executives
• Goal:
Make sure new
contracts are in
line with policy
• Need:
Integration with
Word; workflow
and routing; alerts
on issues
Financial
analysts
• Who: CFO; finance
• Goal:
Understand
financial impacts of
contract portfolio
on costs and
revenues
• Need:
Analytics into the
total contract
portfolio
But remember: different people have different needs
from a CLM system
Contract
managers
• Who: sales or
purchasing
account reps
• Goal:
Manage customer
or supplier
relationship
• Need:
Online access to
contracts; links to
other relevant date;
alerts on issues
Risk
managers
• Who: legal; risk
management
• Goal:
Understand risks
and obligations in
the contract
portfolio
• Need:
Analytics into the
total contract
portfolio

Contracts involve multiple stakeholders, each with
different needs in managing contracts
GCO/
legal
CPO Head of
sales
CFO CIO
Contract repository
Contract reports and analysis
Contract creation and
negotiation
Link to upstream apps
Automated contract compliance
via integration to transactions
Contract optimization

How to succeed with CLM
• Think holistically across the contract lifecycle – plan for all phases of
CLM implementations
• Engage comprehensively – get all stakeholders involved, legal as
well as businesses
• Don’t stop with CLM when the contract is signed – address the
contract management, compliance, and optimization phases
• Take advantage of new AI functions that support the later phases of
implementation, as well as improve support for the initial phases of
implementation

25
Thank You.
Andrew Bartels
VP and Principal Analyst
+1 516.869.0128
abartels@forrester.com

SirionLabs | Who we are
Leveraging AI to transform enterprise contract management (CLM)
$40B+
INVOICE AMOUNT
VALIDATED
$300B+
TCV UNDER
MANAGEMENT
300,000+
BUYERS AND
SUPPLIERS ON SIRION
$2.2B+
HARD SAVINGS
ACHIEVED
SIRION IMPACT
Singapore
India
DenmarkUK
USA
Canada
Netherlands

SirionAI automatically extracts the key metadata
and obligations from contracts...
SirionAI: Contract metadata extraction

SirionAI: Risk assessment and reporting
…SirionAI then proceeds to identify and
highlight risks in the legacy contracts

SirionAI: Assisted contract negotiation
SirionAI assists in negotiating counterparty paper: auto-
categorize each clause; map and identify deviations from
the playbook and suggest drafting alternatives

SirionAI: Automated performance / invoice validation
SirionAI integrates with enterprise transaction
systems to automate supplier performance and
invoice validation

SirionAI: Integration with core transaction systems
SirionAI integrates with enterprise transaction
systems to track against the business and drive
spend analytics

SirionAI: Predictive analytics
SirionAI reconciles forecasted demand
against actual usage to predict future
demand

What’s next?
• Please complete a brief survey at the end of this webinar to give us your
feedback
• Look out for a follow-up email with a copy of these slides and a recording
of the webinar
• Join us for more such events

marketing@sirionlabs.comwww.sirionlabs.com
THANK YOU
@SirionLabs

How AI is Making Contract Management Easier and More Effective

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