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Contract Expert and New LegalSifter Advisor Ken Adams on How AI Adoption is Changing Contracting

04/25/2018 By

Earlier this month, LegalSifter added a renowned expert in contract language to its team. Ken Adams, who joined LegalSifter as an advisor, is the author of “A Manual of Style for Contract Drafting,” published by the American Bar Association, and has spent about 30 years in the legal profession.

LegalSifter applies artificial intelligence (AI) technology to contract analytics (the company promises “contract review in a minute or two”). As Spend Matters analysts Michael Lamoureux and Pierre Mitchell wrote in their recent Vendor Introduction on LegalSifter, its strength lies in the fact that it allows organizations to “quickly analyze a contract or related document against a standard definition and determine if there are any potential issues that need to be addressed.”

The legal profession is not particularly known for innovation, so what is it going to look like as AI increasingly comes into play? We posed some questions to Adams on the rise of AI and broader trends in contract management, as well as his work at LegalSifter.

Spend Matters: How did you come to specialize in contract language?

Ken Adams: In 1996, when I was a law-firm transactional lawyer, I decided to take a closer look at contract language — what works and what doesn’t work — instead of just doing deals. I started devoting more and more of my time to researching and writing about that topic, and in 2006 I made it my livelihood.

Now I consult with companies looking to improve their contracts, and I give “Drafting Clearer Contracts” seminars around the world. The foundation of what I do is my book, “A Manual of Style for Contract Drafting.” I’m pleased to say it has sold tens of thousands of copies. The American Bar Association published the fourth edition in 2017.

SM: What have been the most notable changes and trends in contracts over the course of your career?

KA: The first stage of legal tech for contracts was devoted to how to efficiently store and retrieve data. An example of that is document assembly, which allows you to create a contract not by copy-and-pasting from other contracts but by answering an annotated questionnaire. That remains a crucial technology, but it has been around a while, and I know from frustrating personal experience that it has been slow to catch on.

By contrast, the current crop of “artificial intelligence” products — LegalSifter among them — has attracted a lot of attention. One reason for that might be that instead of just allowing you to performing clear-cut tasks faster, better and cheaper, AI is able to grapple with shades of meaning, raising the possibility that AI technology is better at spotting stuff that lawyers might miss.

SM: It seems that contracting, and the legal sector more broadly, is going to be truly transformed by AI-powered tools. How do you foresee the future of contracting shaping up?

KA: With all the buzz surrounding AI, it’s important to bear in mind that there’s a limit to what technology alone can do. For example, technology can tell us what’s in a group of contracts, but it can’t tell us which provisions are clearest and most relevant. That requires expert editorial control.

Combining technology and expertise is what makes LegalSifter particularly exciting. The technology serves to make old-fashioned expertise much more accessible. That combination has the potential to transform the legal sector must faster than either AI or humans alone can. We expect that in time, discerning clients will demand attorneys who use AI-enable products.

SM: How widespread is adoption of AI technologies in the legal sector currently? Are there any major obstacles?

KA: Things are happening fast, but it’s early days yet. And the legal profession is notoriously conservative — never underestimate the power of inertia!

It’s up to an organization to decide what they’re more scared of — on the one hand, change, or on the other hand, wasting time and money, hurting their competitiveness and assuming unnecessary risk. Increasingly, those organizations that elect not to change will pay a price. For example, only a few law firms have sufficient clout that they can count on being able to charge hefty fees for work done the inefficient traditional way.

SM: Shifting the topic to your new role, how did you come to join LegalSifter?

KA: Twenty years ago, I set myself the task of compiling a comprehensive set of guidelines for clear and concise contract language. With publication of the fourth edition of my book, that work is largely done. Now it’s time for me to shift to the next phase — building products using those guidelines and my understanding of commercial contracts.

Given that review of the other side’s draft contracts is so time-consuming, it made sense for me to join a team that’s using technology to tackle that part of the process. Happily enough, Kevin Miller, LegalSifter’s CEO, had been looking to bolster their expertise, and he contacted me.

SM: What do you most look forward to working on at LegalSifter?

KA: My primary task is to help make sure that what the technology looks for, and what it tells the user, makes sense. Relying on contracts expertise requires a leap of faith. That leap becomes easier if you know whose expertise you’re relying on and what their credentials are. No-name, mystery-meat expertise is unappealing.

So I hope LegalSifter users think my reputation counts for something. And more generally, I hope to discuss with users how to make LegalSifter more effective and what we should do next. It will be fun.

This Q&A has been edited and condensed.