AI Contract Review vs. CLM: Which Contract Automation Solution?

From AI contract review to contract lifecycle management, contract automation is reshaping legal work. Vivan Marwaha of LegalOn Technologies discusses why choosing the right contract automation solution, whether AI contract review software for pre-signature work or CLM for broader contract management, is crucial for maximizing efficiency.

Contract automation streamlines the contract process by minimizing manual tasks, reducing errors, and improving cross-team collaboration. It supports critical steps that include contract intake, drafting, review, negotiation, approval, signing, storage, and ongoing management. 

AI contract review software specializes in accelerating pre-signature processes. It optimizes contract drafting and review through AI-powered tools that compare agreements, flag problematic language, and streamline redlining. Contract review software may also integrate searchable databases of past agreements to ensure consistency. Many contract review solutions include customizable playbooks that enforce best practices, reducing the time spent on repetitive reviews. Implementation can take as little as a day if pre-built playbooks are used; with customized playbooks, implementation might take weeks.

Meanwhile, CLM software automates the entire contract lifecycle, offering centralized contract storage, tracking, and governance. CLMs benefit organizations with high contract volumes by ensuring compliance, mitigating risk, and automating administrative tasks. They provide automated alerts and integrate with business systems to track contractual obligations and renewals. However, CLM implementation is often complex, requiring cross-functional buy-in, and may take several months.

LegalOn Technologies’ 2025 survey of 286 legal professionals revealed that 80% of legal teams are either already using or open to adopting AI contract review software. A recent study by Zuva found that only 36% of legal teams currently utilize a CLM.

Legal teams looking to improve contract efficiency should assess whether their primary challenge is contract review or broader lifecycle management. While AI contract review software is typically faster to implement and delivers immediate results, CLM solutions provide long-term benefits for managing contracts post-signature. A combination of both may offer the most comprehensive contract automation solution for organizations seeking to modernize their contract processes.