Reviewing contracts, extracting data, generating contracts, and most importantly managing contracts’ lifestyles look like herculean tasks but not any more thanks to Robotic Process Automation (RPA).
What is RPA? How is this technology used in contracts? What are its pros and cons? How is it shaping this legal industry? Are you thinking of such questions? If yes, then we have got covered here today.
Robotic Process Automation (RPA) is a relatively new technology, and it is evolving rapidly. It is a technology that allows a computer program to mimic the actions of a human user interacting with a digital system. It is used to automate repetitive and tedious tasks that would normally be carried out by a human. In simpler words, RPA software consists of “bots” and “digital workers” that are programmed to perform specific tasks by interacting with applications in the same way that a human user would.
It is often used to automate repetitive, high-volume tasks that are prone to errors when done manually and are difficult or time-consuming for humans to perform, such as tasks that require navigating through multiple systems or applications.
In the era of businesses and people entering into contractual agreements, this technology can be used to automate various tasks related to contracts, such as
- Reviewing contracts for specific terms and conditions: RPA bots can be programmed to search through contracts and flag any terms or conditions that do not meet certain criteria or that may require further review.
- Extracting data from contracts: RPA bots can be used to extract specific data points from contracts, such as the names of the parties, the duration of the contract, and the terms of payment. This data can then be used to populate databases or other systems.
- Generating contracts: RPA bots can be used to generate contracts based on templates and specific input data. For example, an RPA bot could be programmed to generate a standard employment contract based on an employee’s job title, salary, and other relevant information.
- Managing contract lifecycle: RPA bots can be used to track the status of contracts and to perform tasks such as sending reminders for renewal or expiration, generating reports on contract performance, and automating contract renewals or cancellations
- Contract management: RPA bots can be used to track and manage contracts, including tasks such as reminding parties when a contract is about to expire, or when certain performance milestones need to be met.
RPA is helping organisations streamline their contract management processes, and reduce the risk of errors, while also improving their efficiency.
However, like any new technology, RPA has a few potential drawbacks to consider:
- Complex contracts may require a higher level of analysis and interpretation than RPA is capable of. In these cases, it may be necessary for a human to review the contract to fully understand its implications.
- RPA is only as good as the data it is given. If the data entered into the system is incorrect or incomplete, the output generated by the RPA bot may also be incorrect. It is important to ensure that the data used as input is accurate and up-to-date.
- There is a risk of relying too heavily on RPA, which could lead to a loss of institutional knowledge and expertise. It is important to strike a balance between automating tasks and maintaining the ability to perform them manually.
- RPA is not able to think creatively or make complex decisions outside of the parameters it has been programmed with. This can limit its flexibility and adaptability in situations where a contract requires a more nuanced or creative approach.
- There are a few things to keep in mind while using RPA in contracts to address some of the potential cons: Use RPA in conjunction with human review, Ensure that the data used as input for RPA is accurate and up-to-date and Use RPA for tasks that are repetitive or routine, rather than those that require a high level of creativity or decision- making.
In conclusion, Robotic process automation (RPA) is a rapidly evolving technology that has the potential to significantly impact the legal industry. By automating tasks such as data entry, contract review, and document generation, RPA can help legal professionals save time and reduce the burden of repetitive and tedious tasks.
However, it is important at the same time to carefully evaluate the potential costs and benefits of using RPA, and to ensure that it is implemented in a way that is ethical and sustainable as RPA continues to evolve, it will be important for legal professionals and organisations to stay current with this technology to remain competitive and effective.
