Updated: May 16
Contracts are a critical part of your company’s growth. Businesses use physical contracts to establish business relationships, make financial transactions, and ensure the purchase, sale, and delivery of goods & services.
But isn’t it lengthy and tiresome to create new contracts every time? However, today, businesses can generate contracts without dealing with this friction.
How is contract generation different from contract authoring, and what does it mean to generate contracts? Here's everything you need to know about contract generation.
What is Contract Generation?
A contract generation process involves the assembly or automating of contracts. It's the first stage of the contract lifecycle. Typically, it involves creating and populating a contract before sending it to counterparties for negotiation.
An automated contract generation process creates legal agreements more quickly and efficiently. Manual contract generation is tedious and requires much attention to detail, but many aspects are repetitive, making it a good candidate for automation. Automated contract generation is one of the most popular applications of the Contract Lifecycle Management (CLM) platform. Companies that produce multiple contracts daily, such as law practices, insurance agencies, banks, mortgage lenders, and other companies, can benefit significantly from simplifying contract generation.
How is Contract Generation Different from Contract Authoring?
Both contract generation and contract authoring result in the creation of contracts.
Nevertheless, authoring differs from generating a contract in that it pertains to the actual process of writing the words contained in a legal agreement. On the other hand, contract generation involves automatically creating the agreement by following a pre-prepared template.
Using contract generation, businesses can create contracts quickly and at scale without manually drafting them.
What is the process of generating contracts if they are not written? Let us go through the process of generating contracts.
What is the Contract Generation Process?
The contract generation process has three steps:
Creation and Storage of Contract Templates
Creating templates that will be reused repeatedly and at scale is the first step in generating contracts. These reusable templates allow legal teams to control what is included in specific business contracts.
Using these templates allows commercial teams to draft contracts without needing to complete a contact request form or take the risk of drafting them alone. As soon as the contract templates are completed and approved, the relevant commercial team can access them easily, allowing them to generate standardized contracts rapidly and efficiently.
Commercial Teams Fill Out Automated Templates
When Commercial teams need to generate contracts, they can start generating them by opening a contract template and populating it with the necessary information. Businesses can save tons of time by generating contracts.
The Filled-out Contracts are Sent Out for Approval and Review
Generated contracts are pushed out for approval and review
After the contract template has been filled out, it is submitted for approval.
This can all be done in the same workspace where the contracts are generated using an all-in-one contract platform like InkPaper. In other words, contracts can be signed without going back and forth between word documents, email, and shared drives.
What are the Advantages of Using the CLM Platform with a Contract Generation Tool?
Don’t Have to Wait for the Legal Team
Using CLM platforms like InkPaper with contract generation tools and pre-approved templates eliminates the need for commercial teams to wait for legal to fulfill requests.
Traditionally, legal teams would be responsible for drafting contracts manually. However, with pre-approved and automated templates, commercial teams can self-serve as needed. The signing stage of contracts can be accelerated by removing this blocker.
Higher Consistency & Efficiency
A further advantage of using the CLM platform with a contract generation tool is that it ensures maximum consistency in contract creation.
Moreover, contract generation also improves the accuracy of the data within them. A manual contract workflow requires contract owners to extract and input contract data, but with the CLM platform with a contract generation tool, it is automated. This minimizes the scope for small but expensive mistakes to happen.
In the legal field, drafting contracts takes a great deal of time. A fast-growing business with a lean legal team can produce fewer contracts than it would like.
As a result, contract generation solves this problem. Contract generation reduces contract admin and allows users to generate contracts in bulk. Consequently, it transforms a repetitive contract process into one that is scalable and requires fewer resources - enabling you to grow faster.
Pay attention to the benefits contract generation can bring to your organization. Your team must have a contract lifecycle management solution that can positively transform contract generation.
Contract generation is made easy with InkPaper. Sign up now to discover how InkPaper's all-in-one contract workflow solution can help your business generate contracts!