A legal operations team brings far more to the table than their legal expertise. By leveraging data analytics, they can position themselves as value centers within organizations, combining data from multiple systems to provide insights on organizational health and operational efficiency. As we recently discussed about “Ensuring Legal Operations Has a Seat at the Table“, doing this effectively relies on legal teams both becoming a source of strategic data and on their being thoughtful about where they can step back. With that in mind, what are the main priorities for a legal ops team looking to become data power players?
Legal teams who want a seat at the strategy table may think that implementing analytics will be a big lift, full of manual entry. But as it turns out, most legal operations teams have more (and more efficient) options than they expect. Here are a few things your legal operations team can do to get immediate data value.
Very few organizations start their digital transformation journey from absolutely nothing. In 2024, most companies at least maintain an Excel spreadsheet full of (possibly incomplete) contracting data points, such as key dates, contract values, renewal information, and similar data points. Sure, this isn’t the ideal place to start—but you have to start somewhere. Whatever your legal ops team is doing to capture and track contractual data points, that’s your first step to being a data analytics leader.
If your company doesn’t have a dedicated contract repository tool, you still may have a database to call on. Tangential technologies, like your customer relationship management (CRM), vendor management system (VMS), enterprise resource planning (ERP), or other procurement platform, will often contain contract data that can be leveraged – or extracted – to gain insight into your business.
In any case, your first step is to assess what you have. What areas do you have data on? Where is your data complete, and how can you easily combine existing sources to make it more comprehensive? From there, you’ll have a better sense of where your legal ops team can add value.
Now that you have a sense of what you have, what’s missing? With data integrations, you can find a way to fill the gaps in your existing sources of data with information from other sources. Bring in data from other sources to populate your contracts database, including from your CRM or VMS, to get closer to a single source of truth. This can also provide tactical benefits: By building integrations, you can also help populate contracts, and you can improve the flow of contract generation and approval within your business.
If your data is ready, you can also begin offering your own data a source of truth for other teams. Integrations with your CRM, VMS, ERP, and other systems can help keep records up to date in other systems, giving more information to business users who might not have full visibility to the contracting process. After signature, you can automatically close out opportunities, purchase requests, engagements, and other records. Contract data can also play a role downstream, giving the finance team more information. And by supplementing contracts process such as employee lists to drive approvals and security, you can also enhance your business processes.
Another good source of data for your analytics efforts is your contracts themselves. If you already have the documents, it’s simpler than you might expect to use artificial intelligence (AI) to pull data from them. There are several trustworthy independent tools using natural language processing to perform data extractions on repositories of contract documents, and many Customer Life cycle Management tools now have integrated technologies for this functionality too. Implementing one of these tools is often a good “next step” following the implementation of a CLM system. By determining what you want to see in future reports, you can identify where you have gaps in your legacy data and clearly define the scope of the AI data extractions that are needed, many of which are priced based on the number of data points being extracted.
Now that your data is more comprehensive, you can begin providing value in other ways. The integrations you just built can be the basis for data visualizations and business intelligence tools. Think about what your team needs, starting with frequently asked questions, and begin building your offerings to the company from there. Most legal ops teams will have two areas where they can immediately begin building analytics products:
These are just examples of frequently useful data products you may be set up to provide, but there may be others as well—manufacturing companies will have supplier data to track, healthcare organizations will have group purchasing agreements, and so on. Think about how you can offer the most value quickest.
Though generative AI is still an emerging technology, legal operations teams have found several proven uses that leverage its strengths. By coupling generative AI with your contract repository, you can produce original-text contract summaries, provide alternative clauses with preferrable language (taking your preferred position into account), and more. Of course, you’ll want to double-check your AI tool’s output before using it to make big decisions, but even then, it can be a major time-saver.
Automating contract reviews and supporting negotiations are only the tip of the iceberg, as more and more generative AI offerings appear on the market. As technology advances and more players emerge, we’ll learn more about what AI do for legal operations. For now, watch this space, and pursue new technologies carefully.
Before you go looking for new data, look at the data your legal ops team already has available. So much might already be sitting within the tools you use every day, and extracting already-organized information from these technologies makes them an ideal starting point, and lets you identify gaps. From there, you have numerous options for your analytics, and you can begin being a stronger strategic partner to your company.
Spaulding Ridge has worked with companies at every level of data maturity to help them find valuable answers in their contracts. We’ve repeatedly seen how getting comfortable with data can help legal ops teams drive value within their organizations. If you’d like to explore doing the same, we’d love to hear from you.
