Contract Authoring: The Definitive Guide for Legal & Finance Teams

As business moves at digital speed, contract authoring is getting smarter. The traditional in-house legal professional spent two weeks authoring a standard contract with fragmented templates, inconsistent clauses, and manual workflows. Today, it can be done in a few minutes with contract drafting software. 

Getting CLM right at the contract authoring stage sets the stage for compliance, consistency, speed, and effective contract management reporting.

This blog examines:

• How the process was done traditionally and
• How AI-forward legal teams are streamlining
• How to reduce contract TAT significantly while improving accuracy and compliance.

What is contract authoring? 

Contract authoring encompasses the complete process of creating legally binding agreements—from initial request through final approved draft. It translates business objectives agreed upon terms into enforceable legally binding documents while maintaining compliance, managing risk, and enabling commerce.

It aims to achieve three critical objectives:

1. Speed without sacrifice: Legal teams must match business velocity without compromising the organizational legal position.
2. Consistency at scale: Agreement must reflect current organizational policies, comply with legal regulations, and protect organizational interests.
3. Empowerment through self-service: Business teams need autonomy in the contract creation process without legal bottlenecks or compliance risks.

The traditional contract authoring and approval process

The manual contract authoring process creates inefficiencies that compound over time. It requires hours of repetitive drafting tasks.

Consider this scenario: A sales team needs a standard NDA for a prospect meeting. Without automated authoring sales emails legal with the request. Legal takes at least 30 minutes to locate the template. Manual review and approval process with involved parties begins on email chains and multiple versions. The final signature takes days, if not weeks.

The hidden costs include

• Delayed deals from slow contract creation turnaround
• Increased errors from manual contract data entry
• Compliance gaps from outdated contract templates
• Opportunity costs as lawyers handle routine work

This can further expose organizations to risk from version chaos, the lack of comprehensive documentation, and inconsistent positions. 

Building a smarter contract creation process

Instead of reinventing the wheel, contract authoring software creates a single source of truth for all templates and contract clauses eliminates version confusion with two or more parties while enabling rapid, compliant drafting.

Key components of effective centralization include:

• Pre-determined intake forms
• No code approval workflows
• Conditional rules for routing workflows
• Version control and comparison
• AI-suggested fallback positions for faster negotiation outcomes
• Compliance checks against playbooks
• Bulk self-serve contract generation capabilities
• Comprehensive audit trails for context

Workflow automation turns sequential bottlenecks into parallel processing streams. You can further track process metrics and optimize contract performance for increased deal velocity.

Leveraging AI and contract authoring tools

AI transforms the contract authoring process from mundane drafting to proactive value creation.

Building effective automated workflows:

Why is an automated contract authoring process important

1. 2 minute contract creation time
2. Less human error on important contract data
3. Reduced legal risk
4. Self-serve for non-legal teams

Implementing your new contract authoring checklist

Setting up automated contract authoring involves the following steps.

Map current approval workflows and bottlenecks
Identify high-volume, low-risk contracts for initial automation
Document compliance requirements and playbooks

Define approval matrices by contract type/value
Integrate with existing systems(CRM, ERP, email)
Configure self-service intake forms
Build automated workflows with conditional routing
Implement AI-powered review capabilities
Train legal team on contract administrative functions
Enable business users for self-service contracts
Launch with a pilot group
Monitor adoption metrics and cycle times
Gather user feedback and iterate
Expand automation to additional contract types
Refine AI models based on actual usage

Common questions about AI-powered contract authoring

Can AI completely replace human contract drafting? 

AI excels at pattern recognition, consistency, and speed—but legal judgment, strategic thinking, and complex negotiations remain distinctly human domains. As LeadSquared discovered, AI provides invaluable first-pass reviews and standardization, but human expertise guides final decisions and complex negotiations.

How do we maintain control while enabling self-service? 

Modern CLM platforms provide granular controls—business users operate within defined contract authoring parameters, while any deviation triggers legal review.

Closing thoughts

Deal velocity determines competitive advantage. Organizations that can contract faster—while maintaining quality and compliance with streamlined contract lifecycle management—win more deals, launch initiatives sooner, and adapt to opportunities quicker.

The transformation from manual to intelligent contract authoring enables organizations to do commercial contracts at the speed of business.