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Enterprise Document Automation: Making The Business Case

It’s not the legal industry’s fault that it’s so technophobic. After all, letting lawyers waste their valuable time on high volume, repetitive contracts has been the legal industry’s default approach to maximizing ROI for many years now.

But the recent UnitedLex deal with GE has finally made the industry prick up its ears: a reduction in legal spending by around 30%, savings of $40-50 million and enabling the company to repurpose up to 75 lawyers – how does UnitedLex plan to hit these mighty numbers?

By using legal technology to automate much of GE’s document workflow.

This deal has many enterprises questioning whether document automation technology could also work for them.

The answer, in the vast majority of cases, is a resounding yes.

I’m convinced that it’s not a question of whether automation technology is a good fit for enterprises, it’s a question of whether internal stakeholders and decision-makers can be convinced of its benefits.

In this article, I want to address exactly this problem. I’m going to give you an actionable strategy for making an actual business case for document automation.

Let’s get cracking.

Why Are Automation Adoption Rates Low at an Enterprise Level?

So why has the legal industry been slow to adopt automation technology when the potential gains are so massive? And why are alternative legal service providers (ALSPs) ostensibly much more willing to invest in automation solutions?

I believe the answer is rooted in one key area:

Enterprises find it very difficult to make an internal business case for automation technology.

Even if an enterprise is convinced that they could benefit from automation technology, they are often not able to sell it internally. This fundamental problem of making an internal business case is rooted in the following factors:

Getting Buy-in Is Difficult For Enterprises

Contracts often touch many different departments and stakeholders. This means there are often multiple key figures involved in a contract workflow. Convincing all parties involved that automation is the way to go can be complex. Finding someone to champion the automation project can be even harder.

Complicated Interdepartmental Workflows

Existing processes and behaviour are often deeply embedded across the company. Changing these processes is seen as time consuming and difficult.

Risk Mediation

Great automation technology needs to empower non-lawyers to act independently while preventing any unwanted surprises or business exposures.

Complicated Setup & Hidden IT Costs

Many enterprise document automation solutions need to be integrated with existing internal systems in order to get them up and running. These “hidden” setup costs are a major turn off.

No End-to-End Solution

Another common rebuttal is that automation solutions cannot provide an end-to-end solution. End-to-end solutions do exist

All of these factors conspire to make it pretty damn tricky to pitch automation to internal stakeholders.

So let’s look at some initial steps needed to overcome this.

This suggested process allows you to benchmark automation solutions objectively and calculate automation ROI. Please note that I go into much greater detail in my upcoming ebook “The Smart Guide to Contract Automation”.

enterprise document automation

1) Find The Right Contracts To Automate

Firstly, there’s a common misconception that document automation should be able to automate everything. This is fundamentally wrong. Only those contracts where the highest efficiency gains can be realized are ripe for automation. Those contracts are typically high in volume and low in complexity.

For instance, Supplier Agreements, NDAs, Employment Agreement, Contract Amendments etc often fall into this category.

Contracts that fall into this sweet spot are where you should focus your efforts as they will yield the highest automation ROI.

2) Map Out The Stakeholders Involved

In order to be able to calculate possible ROI from an automation, you need to know how long the current process takes from draft to signature. Map out the steps involved, including drafting,, negotiating, approving and signing contracts.  

You also need to know who is involved. For each step in the contract workflow, mark who is involved. This helps you calculate ROI later.

3) Test The Automated Process Using Software

Many automation solutions on the market including synergist allow you to demo their software. Now that you know which type of contracts are suited to automation, and how long the workflow takes, you can objectively benchmark automation technology. This is a much better way of evaluating solution providers rather than simply trusting the automation provider to figure out what you should be automating.

4) Calculate The Delta

Test out your automated workflow. A comprehensive test should include simulating the full process end-to-end, including client pushback. This can be done by simulating the end-to-end process for a real contract, including having client raise objections and open up negotiations, and then observing how the automation technology handles this. Once you have performed a comprehensive end-to-end test, calculate the delta between the manual and automated workflow. By multiplying the time saved by the hourly cost of each stakeholder involved you can calculate your automation ROI for that particular workflow.

5) Partner With The Right Automation Solution

The right enterprise document automation solution can transform legal departments into proactive business enablers. Not only this but contract automaton can ultimately forge a closer connection between legal and business departments and earn the *GC/legal team* a seat at the table

When people speak about enterprise document automation they are usually referring to document assembly.

This technology allows businesses to assemble – usually in Word – documents from predefined templates. While this is a common solution available on the market, this is by no means the whole story. The document automation market is constantly evolving and there are many other areas where enterprises can realize efficiency gains through this technology.

But industry-leading solutions such as synergist are able to do much more than this.

Marley Spoon, a global meal-kit delivery company serving 300,000 households, chose to partner with us for exactly this reason.

With the help of synergist Marley Spoon can now customise and send supplier agreements in a matter of minutes,  reducing time to send by 90%; the number of high-risk terms in their supplier agreements has reduced to zero. Overall, they were able to reduce legal spending in this area by 75% as they no longer need to engage their external counsel for support and guidance during the contracting process. Marley Spoon’s Management can track progress and manage all their Supplier Agreements from a single dashboard.

Towards a Business Case for Enterprise Automation

Enterprise document automation is no longer a pipe dream. For many enterprises, it will be a necessary step to stay ahead of the curve. Key benefits being enjoyed by partners such as Marley Spoon include:

  • Radical transparency as negotiations update in real-time and data shows where workflows can improve
  • Greater productivity as lawyers are no longer required to create or negotiate recurring contracts
  • Shorter deal cycles as contracts are now managed start to finish using self-service tools

Sign up for a copy of my upcoming ebook “The Smart Guide to Automating Contracts” for the full step-by-step guide on making a business case for document automation.

When it comes to automation, legal has always been late to the party. But it doesn’t have to be the case anymore.