What is Contract Analytics?

What is Contract Analytics?

Contract Analytics is an AI-powered approach to understanding and managing the information contained within legal contracts and agreements. Businesses of all sizes accumulate hundreds or thousands of contracts with customers, suppliers, partners, employees, and landlords. Each of these contracts contains critical terms, obligations, deadlines, and risk factors that affect the business, but extracting and tracking this information manually is time-consuming and error-prone.

Contract analytics uses natural language processing and machine learning to read contracts, identify key clauses and terms, extract specific data points, compare terms across contracts, and flag risks or anomalies. It transforms contracts from static documents stored in filing cabinets or shared drives into structured, searchable, and actionable data.

How Contract Analytics Works

Contract analytics platforms combine several AI capabilities:

Document Ingestion

The system processes contracts in various formats including PDFs, Word documents, scanned paper documents, and digital contracts. OCR technology handles scanned documents, while NLP processes the text content.

Clause Identification

AI models trained on legal language identify and classify clauses within contracts. Common clause types include:

• Payment terms: Pricing, payment schedules, late payment penalties, and currency
• Term and renewal: Contract duration, auto-renewal provisions, and termination notice periods
• Liability and indemnification: Limits of liability, indemnity obligations, and insurance requirements
• Confidentiality and non-disclosure: Data protection obligations, exclusions, and duration
• Service levels: Performance commitments, SLAs, penalties for non-performance
• Change of control: What happens if either party is acquired or merges
• Governing law and jurisdiction: Which legal framework applies and where disputes are resolved

Data Extraction

Beyond identifying clause types, the system extracts specific data points: expiry dates, monetary values, party names, notice periods, and performance thresholds. This structured data can be exported to spreadsheets, contract management systems, or other business tools.

Risk Analysis

AI compares contract terms against your standard positions and best practices to identify risks. It flags clauses that deviate from your preferred terms, such as unlimited liability, unfavourable governing law provisions, or automatic renewal without adequate notice periods.

Portfolio Analysis

At the portfolio level, contract analytics provides visibility across your entire contract base. You can answer questions like: How many contracts auto-renew in the next 90 days? Which suppliers have the least favourable payment terms? Where is our total contractual liability exposure?

Contract Analytics Use Cases

Businesses apply contract analytics across multiple scenarios:

• Contract review acceleration: Reducing the time to review new contracts from hours to minutes by automatically highlighting key terms and risk areas
• Renewal management: Ensuring no contract auto-renews unfavourably by tracking termination notice deadlines across the entire contract portfolio
• M&A due diligence: Rapidly analysing hundreds or thousands of contracts during acquisitions to identify risks and obligations
• Compliance auditing: Verifying that all contracts meet current regulatory and internal policy requirements
• Vendor management: Comparing terms across supplier contracts to identify renegotiation opportunities
• Obligation tracking: Monitoring contractual obligations and deadlines to prevent breaches

Contract Analytics in Southeast Asia

Contract analytics addresses specific challenges for businesses operating across ASEAN:

• Multi-jurisdictional contracts: Businesses operating across Southeast Asia deal with contracts governed by different legal systems. Contract analytics helps track which contracts fall under Singapore law, Thai law, Indonesian law, and so forth, ensuring compliance with each jurisdiction's requirements
• Language diversity: Contracts in the region may be drafted in English, Bahasa Indonesia, Thai, Vietnamese, or other local languages. AI platforms are increasingly capable of analysing contracts in multiple ASEAN languages
• Rapid business growth: As ASEAN businesses grow through partnerships, acquisitions, and expansion, the volume of contracts increases rapidly. Manual management becomes impractical without analytical tools
• Regulatory change: Evolving regulations across ASEAN, particularly in data protection and employment law, require businesses to identify which existing contracts need updating. Contract analytics enables rapid identification of affected contracts

Getting Started with Contract Analytics

For businesses considering this technology:

1. Inventory your contracts: Understand how many contracts you have, where they are stored, and in what formats
2. Identify your primary use case: Is it faster review, renewal management, risk identification, or compliance? Start with one
3. Evaluate platforms: Solutions range from enterprise platforms like Kira Systems, Luminance, and Ironclad to more accessible tools like Juro and ContractPodAi
4. Run a pilot: Test the platform on a representative sample of your contracts to evaluate accuracy and usefulness
5. Integrate with your workflows: Connect contract analytics to your contract management, CRM, or procurement systems

The Business Impact of Poor Contract Visibility

Without contract analytics, businesses face several costly risks:

• Missed renewal deadlines: Auto-renewal clauses in vendor contracts can lock businesses into unfavourable terms for another year simply because no one tracked the termination notice deadline
• Inconsistent terms: Without visibility into existing contract terms, different business units may negotiate inconsistent and sometimes contradictory terms with the same vendor
• Hidden liability exposure: Unlimited liability clauses or inadequate insurance requirements buried in contracts create financial risk that leadership is unaware of until a dispute arises
• Compliance gaps: Contracts signed before new regulations, such as data protection laws, may contain provisions that are no longer compliant. Identifying which contracts need updating requires the ability to search across the entire portfolio
• Revenue leakage: Customer contracts may contain pricing escalation clauses, volume commitments, or discount expirations that are never enforced because they are buried in document text

Contract analytics systematically eliminates these blind spots by making all contract data searchable, trackable, and actionable.