A couple of years ago, most of us had never used AI. Now we're all asking AI what we should have for dinner. While in some instances it might feel like AI is being crammed into every possible industry and process, in the contract lifecycle management (CLM) market, it's far more than a flashy gimmick.
Today, CLMs rebuilt for AI play a central role in how legal and business teams manage contracts. According to BizTechReports, large language models will increase legal department productivity by 10–20% over the next several years. From automating routine tasks to surfacing contract data, identifying potential risks, and answering business questions in seconds, AI gives legal teams the ability to streamline contract management, spending less time on manual work and more time moving the business forward.
Choosing a CLM without AI doesn't just mean missing out on new features. It means investing in contract lifecycle management software that may struggle to keep pace with growing contract volumes, shifting business needs, and competitors already benefiting from AI-driven automation.
Why AI Has Become Essential for Modern CLM
The impact of AI on the legal industry has grown at speed. According to a LinkSquares admin poll, 76% of organizations already have a company-wide AI initiative.
That shift has raised expectations for in-house legal teams. Contracts need to be reviewed faster. Business questions need answers quickly. Collaboration with procurement, finance, and sales is expected to happen with fewer delays.
CLM without AI is starting to look behind the times. And not in a charming, retro way.
The Evolution of Contract Lifecycle Management
Traditional CLM offered significant advantages over manual contract management. It gave organizations a central repository to store agreements, standardize workflows, and improve visibility throughout the contract lifecycle, from contract creation to renewal. For years, it became the system of record for legal teams.
The rise of agentic AI has changed what organizations expect from CLM. Rather than simply storing contracts, today's best platforms have been rebuilt for AI, transforming CLM from a system of record into a system of execution that helps legal teams do the work, take action, and keep every team aligned.
How AI Supports Legal Workflows
Your in-house legal team has more to do than ever before. Business teams expect fast answers, contract reviews can't become bottlenecks, and every agreement still needs the same level of scrutiny. Agentic AI helps legal teams keep pace without increasing workload.
Imagine procurement sends over a supplier agreement for review. Rather than starting from scratch, the AI highlights unusual clauses, identifies potential risks, and routes the contract to the right people for approval. Legal can focus on making decisions rather than working through repetitive tasks.
Without AI, much of this work still depends on manual review, increasing contract cycle times and slowing the business down.
The Growing Complexity of Contract Management
Your contract portfolio is growing. More contracts. More stakeholders. More internal requests. Procurement needs answers. Sales wants approvals. Finance is asking about payment schedules. Every new agreement creates more work for Legal.
Agentic AI helps manage that growing complexity by handling routine tasks, allowing your legal team to respond faster without sacrificing quality or oversight.
Risks of Choosing CLM Without AI
Artificial intelligence (AI) is shaking up just about every industry in the world. From healthcare to finance, organizations are adopting AI to work faster and make better decisions, and legal teams are no different. The advantages it brings to contract reviews, compliance, risk management, and renewal management are becoming increasingly difficult to ignore.
For organizations looking to scale, choosing a CLM without AI capabilities risks creating unnecessary issues.
Slower Contract Review Processes
Slower contract reviews mean slower business. As contract volumes grow, legal teams can quickly become bottlenecks, increasing the risk of delayed negotiations and longer deal cycles as departments wait for approvals from one another.
For example, if procurement is waiting for Legal to review a supplier agreement, every delay pushes the contract further back. CLM rebuilt for AI helps remove these bottlenecks by automating routine work and keeping the contract management process moving forward.
Increased Compliance and Business Risk
Human error is unavoidable. Even the best in-house legal teams make mistakes. The value of technology lies in its ability to reduce the likelihood of costly errors. Traditional CLMs certainly improved governance, but agentic AI takes that a step further by proactively identifying potential risks and bringing them to your team's attention, strengthening risk mitigation along the way.
For example, AI can flag unusual indemnity clauses, highlight missing contract terms, or identify obligations that don't align with your organization's standards before the contract is approved. This gives legal teams another layer of oversight without increasing manual review.
Choosing a CLM without these capabilities leaves your team carrying more risk than necessary.
Limited Visibility into Obligations and Renewals
Missing obligations and renewals are a constant challenge for contract managers. It's easy to overlook a supplier agreement that's due to renew next month when your team is responsible for hundreds or even thousands of contracts.
Poor visibility into contract terms becomes a much bigger problem as contract volumes grow. Missed deadlines, overlooked supplier obligations, and expired agreements can all create unnecessary financial and compliance risks that are entirely avoidable.
Business Impacts of Manual Contract Management
The risks of choosing a CLM solution without AI capabilities include slower contract reviews, increased compliance risk, and reduced assistance with compliance and renewals, which can result in losing market share to your competition.
Higher Operational Costs
Your legal team is already under pressure to do more with the resources it has. Without AI, growing contract volumes often mean hiring additional staff simply to keep pace with demand. CLM rebuilt for AI helps improve contract management efficiency, helping you scale without increasing headcount and reducing operational costs while allowing your existing team to focus on higher-value work.
Delayed Negotiations and Approvals
A slower workflow that relies on manual reviews, endless email chains, and searching for contract information naturally leads to delayed negotiations and approvals. Procurement waits for Legal. Sales waits to close the deal. Every delay reduces deal velocity and slows business growth.
Missed Revenue Opportunities
If your team can't see what's holding a contract back or which agreements are approaching renewal, you risk losing contract value that could have been protected — a common gap in post-signature contract management.
What AI-Powered CLM Delivers
By now, the risks of choosing a CLM without AI should be clear. Just as important is understanding what you gain by integrating an AI-powered contract management platform into your operations.
Automated Clause Extraction
An AI-powered CLM functions like an extremely capable assistant that understands your contracts and can locate clauses in seconds. Rather than manually searching through lengthy agreements, it automatically extracts key clauses and contract data, making reviews faster and more consistent.
For example, if a supplier agreement contains a non-standard indemnification clause, the AI highlights it immediately and compares it against your approved contract language. Your legal team can focus on reviewing the clauses that matter rather than searching every page manually.
Risk Detection and Contract Analytics
An AI-powered CLM doesn't just store contracts. It continuously analyzes them against your organization's standards using built-in analytics, highlighting unusual language and providing citation-backed insights that help Legal make informed decisions with greater confidence.
For example, if your legal team is reviewing a supplier agreement with non-standard liability terms, the AI can flag the clause immediately and explain why it stands out. That leads to faster, more accurate decision-making without relying solely on manual review.
Intelligent Search and Reporting
If a filing cabinet could talk, it still wouldn't come close to what an AI-powered CLM can do. It understands the information inside them, allowing you to search using natural language across all contract types and generate meaningful reports in seconds.
Suppose your CFO asks which customer agreements still contain an outdated limitation-of-liability clause. Instead of manually reviewing hundreds of contracts, Legal can retrieve a citation-backed answer in moments and respond with confidence.
Conclusion
Choosing a CLM solution without AI capabilities affects how quickly your legal team can work, how effectively your business manages risk, and how well your organization can scale end-to-end contract management as volumes continue to grow.
Future-Proofing Your Contract Management Strategy
Choosing a CLM rebuilt for AI isn't just about improving today's workflows. It's about ensuring your legal team has the technology to keep pace with the changing contract management market. Gartner predicts legal technology budgets will double by 2028 as AI adoption continues to accelerate across legal departments.
The LinkSquares platform delivers AI-powered contract lifecycle management through LinkAI, its built-in agentic AI. Earlier, AI could help answer questions about contracts. LinkAI goes further by identifying risks, surfacing key clauses, automating routine work, and helping legal teams take action across the contract lifecycle.
Ready to see how CLM rebuilt for AI can help your legal team review contracts faster, reduce risk, and keep work moving? Schedule a demo today.
Sources:
- Gartner ‘Gartner Predicts Legal Tech Budgets to Double by 2028 as Legal AI Use Expands’ https://www.gartner.com/en/newsroom/press-releases/2026-05-26-gartner-predicts-legal-tech-budgets-to-double-by-2028-as-legal-ai-use-expands