AI in contract management: ambition soars, but data gaps and costs keep legal teams grounded

By mid-2026, Conga's research starkly highlighted a yawning gap between AI ambition and operational readiness in contract lifecycle management (CLM), revealing that while an overwhelming 95% of organizations had adopted AI, only 38% had achieved integrated CLM maturity. This disparity underscores that high AI usage does not equate to effective integration, with many companies lacking the foundational structures to fully leverage AI's potential in contract processes.

The rapid AI adoption in CLM has exposed critical weaknesses in underlying processes, data quality, and governance frameworks, as noted by industry expert Jason Smith who emphasized that 'AI is exposing weaknesses in process, data quality and governance that CLM programs can no longer ignore.' These systemic flaws, coupled with the absence of formal AI policies in 67% of organizations—including those in heavily regulated sectors like healthcare and financial services—have intensified legal teams' burdens to manage risk, compliance, and oversight amid expanding AI use.

Despite near-ubiquitous AI deployment, operational challenges persist, particularly in people and support dimensions: 40% of organizations cite insufficient staff training and 31% report gaps in troubleshooting support, which jeopardize effective AI utilization. Current AI applications remain largely tactical—focused on search, reporting, risk assessment, and contract reviewing—indicating that deeper, end-to-end AI integration in CLM is still underdeveloped and hindered by unclear use cases and fragmented support.

Closing this readiness gap demands a strategic, cross-functional approach that unites legal, finance, sales, and procurement teams to streamline contract operations, reduce risk, and accelerate workflows. Conga emphasizes that organizations which successfully align these functions will be better positioned to harness AI’s transformative potential in CLM, moving beyond experimentation toward mature, integrated, and governed AI-driven contract management.

By mid-2026, Sirion has strategically elevated contract data from a mere repository to a foundational enterprise asset, framing it as a 'fifth system of record' essential for scalable and trusted AI adoption. This repositioning emphasizes trust, data accuracy, and explainability—critical factors for compliance and growth, especially in regulated sectors like European financial institutions exemplified by Achmea. Sirion’s approach addresses regulatory and governance concerns around AI-driven decisions, aiming to strengthen its competitive position and foster stickier customer relationships through premium, data-centric deployments.

CIOs are increasingly re-evaluating contract intelligence as a vital component of enterprise data architecture rather than a siloed legal technology function. Fragmentation of contract data across multiple systems creates visibility gaps that hinder automation, governance, and enterprise-wide AI initiatives, prompting a strategic shift toward integrated, connected contract data environments. Platforms like Sirion exemplify this movement by supporting operational execution and strategic decision-making across procurement, finance, compliance, and customer processes, thereby embedding contract data deeply into enterprise infrastructure.

Sirion’s thought leadership efforts, including participation in industry events like World Commerce & Contracting Connect and collaborations with ALM | Law.com, underscore its ambition to influence cross-functional decision-makers and elevate contract data’s strategic importance among legal and enterprise stakeholders. This outreach aligns with findings that 63% of organizations lack the necessary data foundation for effective AI initiatives, positioning trusted contract data integrity and AI readiness as prerequisites for successful enterprise-wide integration and value realization.

The recognition that contract data links customers, suppliers, financial commitments, and obligations yet remains underutilized and insufficiently trusted highlights its untapped potential as core enterprise infrastructure. Sirion’s framing of robust, connected contract data as critical infrastructure moves enterprises beyond deploying isolated AI tools toward deriving real, scalable value from AI, reinforcing contract data’s role as a strategic asset that supports both operational excellence and long-term growth.

By mid-2026, CIOs and enterprise leaders increasingly recognized that fragmented contract data scattered across multiple repositories and business systems created significant visibility gaps, undermining automation, governance, and AI initiatives. This fragmentation elevated contract intelligence from a niche legal technology concern to a critical enterprise architecture challenge, prompting organizations to prioritize consistent data governance and integration as foundational to unlocking AI-driven insights and supporting audit readiness, enterprise reporting, and strategic decision-making.

The traditional siloed approach to contract management, confined within legal operations, has shifted toward enterprise-wide data stewardship as contracts now influence procurement, compliance, risk, and operational planning. This broader impact drives a strategic redefinition of contract data as a dynamic business asset that must remain interconnected with financial, operational, and customer-facing processes to ensure continuity across the contract lifecycle and enable AI readiness, reflecting a fundamental change in how organizations view and leverage contract intelligence.

Despite the growing emphasis on AI in contract lifecycle management (CLM), a striking 63% of organizations lack the high-quality, trusted contract data necessary for effective AI deployment, underscoring the critical need to distinguish between basic contract repositories and full systems of record. Sirion’s 2026 analysis highlights that poor data quality and common CLM implementation pitfalls continue to impede digital transformation, positioning its platform’s focus on data integrity and AI readiness as a key differentiator for enterprises aiming to overcome these challenges and establish robust, enterprise-wide contract data stewardship.

By mid-2026, Sirion's collaboration with Achmea underscored a pivotal shift in AI-driven contract management within regulated financial institutions, where trust and explainability trump raw processing speed. The emphasis on 'trusted AI' reflects a sector-wide demand for transparent decision-support systems that not only store contracts but actively aid compliance and growth, positioning Sirion to move beyond mere repositories toward indispensable governance tools.

Confidence in contract data integrity and interpretation emerged as a non-negotiable foundation for institutional users, as evidenced by Gaeva’s extensive contract reviews at a major investment bank. This highlights the critical role of 'AI-ready' contract data in underpinning compliance and risk management frameworks, ensuring that AI outputs are both reliable and actionable within stringent regulatory environments.

Addressing regulatory and governance concerns around AI-driven decisions is not just a compliance checkbox but a strategic imperative for vendors like Sirion aiming to secure competitive advantage in financial services. Successfully navigating these challenges promises not only enhanced trust but also the potential for premium pricing and stickier customer relationships in a demanding enterprise market, signaling that explainability and governance are key differentiators in AI contract management.

By mid-2026, the steep costs and intricate implementation processes of AI-powered contract lifecycle management (CLM) tools have become a significant barrier for legal departments. With price tags ranging from half a million to $2 million annually just to get implementations right, organizations often find themselves locked into expensive consulting engagements every time workflows evolve. This ongoing dependency not only inflates budgets but also complicates maintenance, as each change demands costly re-customization by external partners.

The reliance on implementation consultants has fostered a problematic ecosystem where these partners benefit from drawn-out, costly projects, effectively masking product shortcomings. As one insider bluntly puts it, these consultants act as a 'crutch that always keeps the product with a broken leg,' incentivizing prolonged interventions rather than genuine product robustness. This dynamic undermines true adoption and sows distrust among users who face constant disruptions and external fixes.

Facing this quagmire, some organizations are pivoting away from perpetually customizing off-the-shelf CLM solutions toward building bespoke systems tailored to their unique workflows. This strategic shift reflects a desire to reduce reliance on expensive consultants and gain greater control, with one legal leader noting, 'I just build my own version because I know exactly what our department needs.' Such tailored approaches promise more agility and potentially lower long-term costs, though they require upfront investment and technical capability.

By mid-2026, Sirion strategically sharpened its focus on 'contract intelligence' and operational resilience, particularly targeting the supply chain and procurement sectors where volatility demands proactive insight into commitments, obligations, and supplier risks. This shift from mere contract storage to advanced analytics and workflow tools reflects a deliberate effort to meet market demands for enhanced visibility and anticipatory decision-making, positioning Sirion to offer differentiated value in interconnected supply networks.

Sirion’s active engagement at industry events like SCPC 2026 not only amplifies its brand recognition but also fosters critical partnerships within the procurement ecosystem, a niche yet rapidly growing segment of contract lifecycle and risk management. Such strategic presence underscores the importance of community and collaboration in driving adoption, customer retention, and competitive differentiation in the evolving landscape of AI-powered contract management.