Glossary

Artificial Intelligence (AI) is the ability of a computer or computer-controlled robot to undertake and perform tasks that a human being would. AI refers to the simulation of human intelligence within technology, programmed to think, mimic actions and perform tasks in a way that humans would.

In business, a bottleneck is when a process stops or gets stuck at a certain point, limiting the capacity of the entire chain. For example, the result of having a bottleneck along a production line of goods or services is a stall in production, which in turn causes delays in delivery.

ChatGPT is an AI-powered chatbot that has been developed by OpenAI. It’s a natural language processing tool that uses AI technology, enabling it to have human-like conversations. It can answer questions and complete tasks (including writing social media posts or articles, or even making a meal plan).

ChatGPT has been trained using a compilation of web sources and real-time conversations with human contractors.

A contract clause is a section within a legally binding agreement that contains a set of specific T&Cs and important provisions of the legal agreement between the engaged parties. A contract clause dictates conditions on which the involved parties agree to act on during the duration of the contract.

Contracts are made up of many different causes, and all of them serve different purposes. Together, the contract clauses are the foundations of the agreement for the parties to sign and execute.

A contract abstract is a summary of critical information within a contract. Contract abstraction is a legal process designed to highlight all the important information from within an agreement, providing a ‘snapshot’ into its key data.

Contract analysis is the process of examining and tracking key information or insights from legal agreements using regularly conducted contract reviews and analysis. The tracked information can be anything that a business finds valuable.

Contract analysis can either be completed manually or automated with relevant contract automation software.

A contract audit is the process of internally assessing a contract to ensure that all key provisions and regulations are understood and adhered to by the involved parties. Typically, contract audits are most common for post-signature contracts and often involve examining and analysing multiple documents. It may also involve devoting resources to one specific area.

Contract automation is when software or technology is used to automate a part or all of the contract lifecycle.

Contract automation allows both legal teams and non-legal users from the wider business to streamline their contractual workflows by enabling teams to self-serve on routine legal tasks, such as contract creation, at scale without the need for involvement from the legal department. Contract automation simplifies and accelerates contractual processes that were once manual-heavy and complex.

A contract checklist is a list or framework that allows businesses to identify and organise the key elements of a contract. They are a step-by-step guide to what should be contained in a contract before it's finalised.

Contract creation is the process of creating a contract, sometimes using pre-set clauses and playbook or occasionally, completely from scratch.

All contracts must include these six essential elements: Offer, Acceptance, Awareness, Consideration, Capacity, and Legality.

Contract lifecycle management (CLM) is the management of a contract across it's full lifecycle and across each stage of its journey. The process begins during the pre-signature stage of a contract at the proposal stage and ends when the contract is up for renewal, during the pre-signature stage.

CLM software is an end-to-end solution that digitises and automates the contract lifecycle through each stage from pre- to post-signature. CLM brings benefits for the wider business, not just legal, by helping businesses improve their efficiency, enhance cross-department collaboration and mitigate and manage risk.

Contact management is the process of overseeing and managing legally binding contracts within a business.

Effective contract management helps businesses to improve outcomes and visibility into their contract portfolio, enabling better-informed decision-making and maximum profitability.

Contract review is the process in which a contract is reviewed thoroughly to identify, analyse, and understand the key provisions within a contractual agreement before it is signed. The process can be done manually or by using contract automation tools.

Legal professionals will review each new contract to understand the T&Cs of the new relationship and to highlight risks and opportunities within the framework.

Contract risk management is the assessment of a contract to establish its maximum value, typically using compliance tracking to determine the amount of risk involved throughout its lifecycle. Some risks can be financial or compliance-related or can be to do with breaches and security, among other issues.

Risk can be a blocker to effective contract management, so contract risk management is crucial to the long-term success of your contract portfolio.

A contract summary is a condensed document (usually one page or less) used to outline the most important and relevant information of a contract, in an easy-to-read format. Contract summaries act as a window into the contract, simplifying the complex language into a digestible format.

Contract termination is the process of legally ending a contract or agreement before its expiry date and before one or more of the parties can fulfil their side of the agreement. A contract can only be terminated once it has been signed and is enforceable.

Contract tracking is when the stakeholders of a contract, most notably legal, track its progress, performance, and who it's assigned to.

Cross-departmental collaboration is when employees from different departments come together and work towards a shared company goal. For example, Sales and Marketing may collaborate to refine and improve their processes for generating inbound leads.

Every business is made up of different departments, from HR to Sales to Customer Success, and strong teamwork is key amongst departments to ensure the overall success of a business. Cross-department collaboration is a way to strengthen teamwork and relationships between different departments.

Digital contracting is a process that transforms every stage of a contract's journey into a digitalised, collaborative, and data-first workflow. It facilitates the contract lifecycle by connecting the dots between stakeholders, departments, processes and data – enabling everyone in the business who works with contracts to do so seamlessly.

Digital transformation is the process of integrating digital technology into all areas and departments of the business. The objective is to fundamentally improve how a business operates and delivers value using digital solutions.

Due diligence in law is the exercise of reasonable care during business operations and dealings. Due diligence involves an investigation to gather information (usually commercial, financial and legal) on a company or assets as part of the risk mitigation process by a potential buyer.

Enterprise contract management is a centralised end-to-end contract management solution that allows large business (typically with a headcount of over 5,000+) to effectively manage their contract portfolio throughout each step of a contract’s journey. Implementing an end-to-end solution at the heart of the enterprise allows the wider business to access and collaborate on contract workflows.

Force Majeure is a clause within a contract that defines events, acts or circumstances beyond the control of the involved parties. For example, natural disasters such as flooding or earthquakes. The clause typically excuses one or all the involved parties from the full performance of the contract following such events.

An Integration is the connection or merging of two (or more) tools. Integrated solutions can interact with each other, creating a fully connected software ecosystem.

Businesses use multiple tools to power their tech needs, from file storage, CLM systems and marketing automation tools. So, the approach to working on desktop applications or on-site solutions has shifted towards an interconnected approach, where the business on-site applications and systems are becoming integrated.

An integrated CLM is an end-to-end solution with a digital approach to creating, reviewing, executing, and managing legal contracts and agreements. Traditional CLM solutions use an external platform that requires users to alter their working habits, often sitting outside of their traditional workflows. An integrated CLM like Summize uses Microsoft Teams, Word and Slack as the primary user interface.

A legal front door is a term used to define a simple and secure digital tool that enables an organisation's non-legal employees to access the legal team and their processes more efficiently and typically using self-serve processes.

The legal front door concept has been designed to enable businesses to streamline and track legal requests from the wider business.

Legal technology (or legal tech) is software that delivers legal services or supports the legal industry.

With technological advancements, legal tech now helps legal professionals and departments digitalise manual processes. It’s a broad term and includes a variety of different tools and applications such as CLM software, matter management and e-billing solutions.

Optimised efficiency refers to the goal of carrying out an activity with maximum efficiency by optimising the processes and procedures that are in place. For example, it takes 86 minutes on average to review a single contract. But by utilising contract review software, legal teams can reduce their time spent reviewing a contract by 85%. Therefore, optimising their efficiency.

A playbook is a mechanism designed to capture and record the standard positions and legal verbiage of a business, ensuring consistency through standardisation while also mitigating risk when entering new legally binding agreements. When creating new contracts, clauses and terms can be taken from these playbooks to build the document.

A red flag review is when a party reviews a contract to identify any areas, clauses or T&Cs of the agreement that do not suit their company’s standard positions or may cause a problem later. The process is intended to act as a pre-screening tool for the agreement, allowing the parties to identify any areas of concern.

Depending on the business, the process can involve using a traffic light scheme to identify areas of risk that require further due diligence or that may require additional insights for evaluation.

Contract redlining is a process during the pre-signature stage of the lifecycle that involves editing a contract to flag clauses during the negotiation stage.

The terms come from the traditional method, where a contract would be printed, and the parties would mark up their amends with a red pen. Today, however, contracts are negotiated digitally, usually in Microsoft Word using the track-changes tool.

A contract repository is a centralised place where a business stores its full contract portfolio.

Before digitalisation, businesses stored copies of their physical contracts in filing cabinets, drawers, and local drives. Today, with the utilisation of CLM technology, a contract repository is a digital, cloud-based storage centre, making it easier for businesses to search, report and analyse contractual data for insights to drive smarter business decision-making.

Risk mitigation is the process which a business undertakes to reduce and eliminate the risk that it might face in any of its processes or legal documents. The process typically involves the identification, evaluation, and prioritisation of risk before implementing a strategy to minimise, monitor, and control the risk and any potential events.

In business, self-serve tools are solutions that allow users access to resources and systems to complete a task without requiring assistance from another individual or department. For example, self-serve contract creation enables commercial users to create contracts without legal intervention.

Workflows direct people or processes through certain steps in a chain or a flow to ensure consistency, accuracy and efficiency. Making changes to a workflow, such as removing an unnecessary step or introducing automation, can have a positive impact on the procedure. For example, implementing an end-to-end CLM enhances contract workflows and improves the contract process.