The nature of contractual documents is inherently complex. Anyone who has ever had to negotiate the terms of a lease, sign a partnership agreement, modify a statement of work, or request a change to a sales agreement will understand the intricacy and variability of contracts. As such, there are countless products on the market for managing the lifecycle of a contract and archiving the document for records management purposes. But applications that manage these types of documents are only as useful as the metadata that is keyed in when the contract is created.
The inconsistency of contractual documents and contract language combined with the advancement of supervised machine learning and natural language processing has led companies and government agencies to seek contract management tools to help automate the predominantly manual process of maintaining, reviewing, approving and storing contracts. It should come as no surprise that smart content capture tools like Ephesoft Smart Capture® platform can supplement an organization’s contract management strategies through automated document classification and data extraction.
There are four key areas of improvement where smart document capture and supervised machine learning can help automate contract management: compliance, productivity, information searching and cost savings.
Compliance
Regulating agencies such as the International Accounting Standards Board (IASB) and National Archives and Records Administration (NARA) have clear policies around maintaining contracts and reporting on information negotiated in a contract. Nearly every industry will have its own set of standards around how contract data is managed.
However, the complexity of contracts often means reviewing, approving and archiving the document requires a significant amount of human interaction and manual oversight. These types of documents are highly unstructured so traditional capture tools are ill-suited to parse out valuable information, such as contract party names, contract close dates, terms and conditions, etc.
Using a smart document capture and processing solution like Ephesoft as a contract management tool helps organizations maintain industry compliance regulations for interacting with contract documents. The Ephesoft platform uses a combination of rules-based extraction, multi-dimensional textual analysis and natural language processing to automatically and accurately identify key pieces of information throughout the unstructured documents, which may be necessary to meet compliance regulations.
Increased Productivity Through Automation
A primary benefit of contract management systems is the automatic tracking of document data like agreement dates and the contract party to provide users with notifications and reminders of contract events or document workflows. But without a front-end capture tool that can extract this necessary metadata, business users or scanner operators are required to read through the documents and key-in this indexing information. With contracts spanning from a few pages in length to hundreds of pages, this can be an incredibly laborious task.
The Ephesoft platform utilizes data recognition tools, such as pattern matching, in conjunction with anchor value identification to accurately detect and extract crucial data points from unstructured documents. End users will no longer have to manually search for and then type metadata such as the contract execution date in the content management system. Instead, Ephesoft is working behind the scenes to isolate the date fields within the document through regular expression matching, then select the appropriate date through key value pairing or an alternate extraction method. Document processing time is typically reduced by an average of 50% to 75% when moving from manual data entry to automated document indexing through Ephesoft.
Information Searchability
A search bar is only as powerful as the database or repository it points towards. Searching for information across image-only contract files can be a fruitless activity if comprehensive document metadata has not been populated and the document has not been rendered fully text searchable.
Acting as the front-end content capture source for a document, records or contract management system, the Ephesoft platform converts static files into text-searchable documents through Optical Character Recognition (OCR). Contract data is indexed through full-text analysis and supervised machine learning before being passed through to the document’s end destination and storage location.
Cost Savings
Revenue recognition is an important component of contract management. Guaranteeing that the contractually agreed upon amount of revenue is realized as soon as possible can substantially impact an organization’s reported earnings. Maintaining accurate contract document metadata through automated data extraction can help organizations keep track of billing and revenue recognition details to ensure the maximum potential of a contract is met.
Would you like to learn more? Email info@ephesoft.com or schedule a demo of Ephesoft Transact for more information on how the Ephesoft Smart Capture® tool for documents identifies and extracts valuable document metadata to support automated contract management.
