Your Guide to Pre-Execution Contract Review Tools

contract tech

If a contract was a glacier, the part you can see would be the finished product, signed and accepted by both parties. The much larger part you can’t see would be the amount of planning, analyzing, negotiating, reviewing, writing, and rewriting that happens before it’s signed.

When so much work goes into a contract before it’s executed, having smart and reliable tools to streamline the process can help contract teams produce efficient, quality work in fast-paced negotiations.

Pre-Execution Contract Tools can be the key to streamlining your contract review process. Here’s everything you need to know about these resources.

What are Pre-Execution Contract Tools?

Pre-execution contract tools are useful technologies that help organize, build, write and review a contract before signature (execution).

These tools leverage AI and machine learning to scan contracts for potential language, compliance, and business terms issues. They can also help legal teams compare contracts to industry standards and best practices.

Using these tools helps minimize human error and oversights and suggests clear ways to fix language or compliance issues.

Benefits of Using Pre-Execution Contract Tools:

  • Getting users to sign faster
  • Reducing the expense of contract negotiation
  • Ensuring adherence to contract negotiation playbooks
  • Standardizing contractual risk

What Do You Need in a Pre-Execution Contract Tool?

While dozens of pre-execution contract review tools are on the market, there are a few key factors that all buyers should consider when evaluating pre-execution contract review technology.

Contract Portfolio Size

Different platforms cater to different sizes of portfolios. Companies with extensive and complex contract needs require a robust platform that can handle the level of data without slowing down or hitting a ceiling.

Custom Features

Different organizations have different priorities regarding contract review. A “teachable” AI tool powered by previous contracts and company standards will minimize the time spent on reviews and edits.

User Experience

Pre-execution contract tools only save time if your team knows how to navigate the platform easily. That’s why platform user experience is critical to contract review AI success. Having a clear, easy-to-use platform with a quick learning curve is essential for a team to experience a seamless transition from manual to automatic contract review.

Customer Support

When a platform question pops up, having a dedicated support team ready to fix any issues is the difference between completing tasks efficiently and having them come to a screeching halt. Ensuring your contract review software has a dependable customer support team will save your team from time-wasting research and wild goose chases.

 Pre-Execution Contract Review Tool Abilities

Understand terms and phrases often used when analyzing the abilities of pre-execution contract tools.

Comparison to Client Standard: Comparing a contract clause by clause against a client’s standard provisions. Sophisticated tools can precisely explain how the contract under analysis presents contractual risk and deviations from the client’s standards.

Comparison to Industry-Standard Language (Benchmarking): Similar to comparison to client standards, these tools indicate whether the language adheres to the overall industry standard. For example, a SaaS agreement may include a limitation of liability provision that caps damages at $25,000. Industry benchmarking tools will identify the limitation of the liability clause and indicate that the industry standard is 1x the fees paid or payable over the preceding 12-month period. 

Clause-level Semantic Similarity: Using machine learning, contract AI can read contracts and identify or suggest language that the company has previously agreed to in another contract. More advanced AI models can provide this consistency within contracts with clear diction so legal teams can minimize extra editing tasks.

Classification: AI classifies common sections of the contract, which is helpful in easily finding sections that typically present contractual risk and must be reviewed and revised prior to contract execution.

Extraction: AI offers a summary of key points, questionable clauses, and contract parameters for legal teams to consider as they review contracts prior to negotiation. The extracted data points can help the negotiation team understand contract limitations before starting manual review and contract markup.

Risk Rating/Scorecard: AI reads contracts and surfaces the potential risks in your contracts. While some risk rating tools only provide general information about risks, more robust AI tools can customize the risk rating to a user’s specific needs.

Automated Contract Markup: AI edits and tracks changes to contracts according to your company’s playbook in minutes. Advanced automated contract AI markup explains why the redline change was made and uses your company playbook to spot issues and inconsistencies customized to your company’s needs.

Prompt-Based Editing: The user locates text in a contract that needs revision and then inputs a prompt (sometimes from a pre-defined list of prompts) the selected piece of text with the prompt, is inputted into an advanced language model that generates new or revised text..

Pre-Execution Contract Tools Vs. Post-Execution Tools

Pre-execution contract review tools focus on the contract review and negotiation process prior to signature.

Post-execution tools are generally used to:

  • Organize information in existing agreements
  • Search for information in contracts
  • Feed information in executed contracts into other downstream systems, like accounting or project management tools

These tasks are handy for contract review in M&A due diligence, identifying key details during contract renegotiations and creating contract “cheat sheets” for project management teams.

Post-execution contract tools tend to have more niche uses, while pre-contract negotiation tools are useful in virtually all contract building, negotiation, or reviewing processes.

By leveraging advanced AI and machine learning technologies, pre-execution contract AI tools help your legal team confidently execute all contract review tasks before the signature. Ready to transform your contract review process? Explore BlackBoiler AI Contract Review Software today and take the first step towards smarter contract management.

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