To get some clarity and cross the contract AI chasm, we have partnered with World Commerce & Contracting to conduct the first-ever, comprehensive benchmark study on the benefits, barriers, and usage of AI within contract management. In this part of our series "Crossing the Contract AI Chasm", we dive deep into our fifth trend: most organizations still face significant barriers to AI adoption.
Our Findings
Despite the growing enthusiasm for AI across industries, our research shows that many companies still face barriers to adopting it for contract management. Actually, 60% of respondents said that they are facing one or more barriers to adoption.
There are numerous barriers to be faced when trying to adopt AI for contract management, but our research uncovered three main barriers of concern. They are:
1. Obtaining budget
Although many companies reported that they have a budget for CLM solutions, budget for AI tools is less common. This may be because many CLM vendors require a point solution to supply AI functionality, requiring additional budget and time for implementation.
Another possible reason that companies are struggling to secure budget for AI tools is that they are challenged to create a compelling vision of future gains AI can help achieve. As a result, stakeholders are unable to generate a convincing business case and demonstrate the return on investment that these tools offer.
2. Consensus among stakeholders
Unfortunately, the individuals who could benefit the most from AI aren’t always the decision-makers. Those in lower to mid-level management positions are the ones who see the most impact in their everyday jobs. However, respondents reported that most key sponsors for AI initiatives were at the VP or C-suite level. In order for AI tools to experience widespread adoption and for companies to reap the organizational benefits, buy-in from all levels of the organization will be essential.
3. No CLM solution in place
Nearly 50% of respondents said that they have not fully implemented a CLM solution. Without a strong contract management foundation in place to build upon, AI is not able to provide its full benefit.
Key consideration
AI tools should be seen as an extension of the contract management ecosystem
The same implementation barriers may be causing a lack of trust in CLM vendors to provide the foundation needed for AI tools to truly benefit an organization. It’s possible this disconnect, paired with unmet expectations, is placing a strain on contract management practitioners who are often responsible for building the business case for new or additional solutions.
To read the full benchmark report, click here.
To see what an AI-charged solution can do for you, check out our Lifecycle AI page! If one of your top priorities for the next few months is to implement a CLM solution, request a demo!
