Humans and AI: together, transforming contract management

In collaboration with

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CCM Institute

In brief

Generative AI (GenAI) is a transformative technology reshaping industries by automating and augmenting human decision-making processes. Within contract management, the adoption of AI-driven Contract Lifecycle Management (CLM) systems offers immense potential, but organizations must carefully evaluate where and how to integrate AI while maintaining human oversight.

Not all contracts are equal, and it is essential for organizations to establish the right balance between activities that are fully automated and those that remain human-led with AI support. On the one hand, AI offers a major uplift in efficiency, providing a combination of cost savings and speed. On the other, it offers contract professionals a new level of knowledge and insight, raising their effectiveness in guarding against losses and improving the value achieved.

This report provides the insights needed to support effective analysis and segmentation of a contract portfolio. It draws on a framework proposed by Laurence Ales and Christophe Combemale, professors at Carnegie Mellon Business School, and applies this to better understand the implications of AI adoption in contract management. Our analysis considers four pivotal factors: complexity, frequency, task interconnectivity, and the cost of failure.

Planning the way forward has taken on added urgency since it is increasingly clear that forming and managing our trading relationships is fast moving beyond human intelligence. This quote from a Commercial Director at a global giant in the telecoms sector sums up our environment.

“AI, security of supply chains, cyber security, interest rates, more outsourcing and ‘as-a-service’, contract agility …. Relationship Management, adaptability – the success stories will come from teams who can collaborate, manage change, embrace empowerment, be resilient and work together to chart a positive path through all of these challenges.”

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Humans and AI: together, transforming contract management

Call to Action: Making AI Work for Your Contracting Process

AI in contract management isn’t about replacing people—it’s about making the function more efficient, insightful, and strategic. Large organizations should take a structured approach to adoption, ensuring AI supports and expands human expertise rather than undermining it.

Map where AI should be applied
AI can handle high-frequency, low-risk tasks like compliance checks, metadata extraction, and template generation with minimal oversight. It an also improve performance in more complex areas such as negotiations, risk assessment, and dispute avoidance by identifying patterns, flagging risks, and modeling alternative scenarios. However, these outputs need human interpretation and validation to ensure commercial and relational factors are fully considered.
Select and implement AI-enabled CLM systems that drive real value
AI should reduce manual effort, enhance visibility across contracts, and surface risks before they escalate. The right tools will integrate across stakeholders—legal, procurement, finance, and commercial teams—to provide a connected view of contract development and performance. AI-driven analytics can strengthen negotiation preparation and help assess contract risk, but organizations must ensure these insights align with strategic goals rather than just automating existing processes and repeating past approaches.
Redefine the role of the contracting discipline
AI is not only about making existing work faster or less costly; it’s about shifting the focus of the contracting discipline toward higher-value activities. As AI takes on more data-driven analysis, professionals will need to sharpen their skills in scenario planning, interpreting AI outputs, and making judgment calls on complex commercial issues. This shift requires investment in new ways of working—adapting workflows, decision-making structures, and skill sets to maximize AI’s benefits.
Establish strong governance and oversight
AI adoption requires clear policies on data security, confidentiality, and accountability. Organizations must ensure that AI-generated insights are tested, validated, and continuously improved to avoid errors, biases, or misleading outputs. AI should be a tool that enhances decision-making, not an unchecked system that, dictates contractual outcomes.
Make AI adoption a mindset shift, not just a technology upgrade
AI is already changing contract management, and companies that see it as a valued driver—rather than a compliance tool—will be better positioned for the future. Leaders should focus on fostering AI literacy, ensuring teams understand not just how to use AI, but how to challenge, interpret, and apply its outputs effectively. Those who embrace AI as a way to enhance their role rather than compete with it will shape the future of contract management.

The real challenge isn’t whether AI will change contract management—it already has. The question is how organizations will use it to their advantage. Those who act now, with a clear strategy and a focus on integrating AI with human expertise, will be the ones setting the standard for their industry.

In conversation with Andy Wishart, Chief Product Officer at Agiloft

What guiding principles can help to determine where AI should lead versus where human expertise remains essential?

How do you see AI-based systems addressing the challenge of human frailty or lack of judgment?

Which factors are most overlooked by organizations today when adopting AI in contract Management?

What message would you give contract professionals about the future of their roles in an AI-enhanced world?

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Written by

Tim Cummins Follow me on LinkedIn

President
WorldCC

Andy Wishart Follow me on LinkedIn

Chief Product Officer
Agiloft

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