9th January 2020
9th January 2020
By Sarvarth Misra, Co-Founder and CEO at ContractPodAi
In our previous report, we looked back on the legal tech trends that occurred in 2019. While it is important to reflect on the past year, it is even more important to look toward the future, set goals, and be prepared for what’s to come! This report will cover the ‘2020 vision’ for the legal tech industry - and our own predictions for contract lifecycle management, digital transformation, and other areas this upcoming year.
As the need for contract management systems increases, so will the demand for contract lifecycle management (CLM), itself. As stated in our previous blog, the popularity of contract management has grown significantly since 2018. And the call for contract lifecycle management has increased along with it. In fact, the CLM operations segment is worth roughly $400 million and has a projected compound annual growth rate of 12 percent all the way to 2022, according to Gartner.
There is a high volume of contracts seen in almost every company. Contract lifecycle management will become even more of a necessity rather than an extra piece of technology.
At the moment, contract lifecycle management targets mid- to large-size corporations and in-house legal teams. As contract management solutions continue to show positive results, smaller-sized businesses and corporations will see the benefits of investing in these solutions, too. Contract lifecycle management is a vital part of any company's organization. There are far too many chances for error when Excel spreadsheets and loose paper are used instead of a CLM solution. But, the costs of adopting the later gives many companies pause. Especially if they believe that they are “doing just fine” conducting business the old way. Still, without effective contract lifecycle management, more than 9 percent of annual revenue is lost, according to IACCM.
“I think we're going to continue the process that was in place in 2019," says Cara Walker, Esq., Senior Account Executive at ContractPodAi. "Right now, we're only tapping into half of the market, targeting large corporations. But I see more and more smaller corporations appreciating the need for CLM. And I want to be there for it."
A record-breaking $1 billion was invested in legal tech last year, according to Bloomberg Law. That rate of investment will only increase because of technological advancements that are transforming the way legal teams work. For instance, using artificial intelligence yields positive results in the workplace. In a recent Forbes survey, more than 60 percent of executives whose companies adopted AI reported that it led to increased revenues in the business areas where it was used.
Interestingly, AI startups have the potential to form the next wave of trillion-dollar companies, Forbes says.
Society is becoming more technologically advanced by the day. The legal industry, in particular, has adapted to the changes brought on by digital transformation. They have adopted legal tech solutions and other technologies, automating everyday activities and reducing time-consuming tasks significantly. In a recent Gartner survey, more than 55 percent of CEOs also said that their digital efforts have increased profits already.
With continued investments in legal technology, digital transformation will become even more widespread. Clearly, those who embrace digital transformation today will have a distinct advantage. Those who continue to work manually will fall further behind.
In the future, we also see artificial intelligence becoming more functional. This will have a huge impact on the legal industry and contract management. This means that the AI is pre-trained and ready to use once a consumer purchases it. ContractPodAi's own contract lifecycle management solution already comes right 'out-of-the-box,' as we prefer to focus more on AI than machine learning. Businesses that combine AI with human insights see more than a 60 percent boost in productivity and customer satisfaction, according to Forrester.
“The move to technologies that are functional ‘out of the box’ will continue to have a an impact on the legal market," says Mark Langsbury, VP Sales EMEA at ContractPodAi. "In the early days of legal tech, the majority of customers who procured legal technology then had to modify the tech to make it fit within their organization. Ultimately, this meant more time and costs for implementation, and a complex system with lower adoption rates for most. But there has been a shift in the market toward functional tech. Customers can get to a better place without having to reinvent the offering."
Having functional AI is crucial for companies. It makes a number of jobs more efficient and easy. Although people fear that the adoption of AI will replace jobs altogether, the opposite is true. Gartner estimates that $2.3 million new jobs will be created by 2020 - thanks to the use of AI in the workplace. After all, AI has a long way to go before it fully replaces the human brain.
With a new year and decade beginning, it is both exciting and enticing to think of all of the changes that could happen. Because of technological advances, in general, more people will see the benefits of using legal tech, in particular. So it seems rather inevitable that these changes will come to fruition in some form or another.
If you want to know more about contract management and what it can do for you, check out our contract management primer. Or if you’re more of a visual person, you can request a demo. At ContractPodAi, we take pride in our system and want to provide you with the best contract lifecycle management out there. Now, let’s head into this decade even more organized!
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