Brief
Discover how generative AI is transforming the construction industry by streamlining contract management tasks, from plain English translations to contract drafting, data extraction, and prompt-based editing.
Insight
The recent surge in generative artificial intelligence (AI), such as OpenAI’s GPT-4 model, is revolutionising contract management in the construction industry. Generative AI holds remarkable potential for creating various content types, including text and synthetic data. Despite some tech leaders calling for a ban due to its rapid development and potential risks, the technology is making a significant impact in areas like construction contracts.
Generative AI offers several practical applications in the field of construction contracts. It can translate complex ‘legalese’ into plain English, aiding project managers and other field personnel in comprehending the contract’s stipulations. The AI’s ability to draft new contracts, extracting essential data from massive text volumes, and implementing uniform edits across a document also eases the process of contract management.
For example, generative AI can automate data extraction from a rotating set of contracts and automatically integrate the key information into systems like billing and accounting, or trigger notice processes or renewals. It can also make consistent edits across the contract document, reducing the scope of manual errors.
However, challenges persist for the widespread adoption of this technology. Information security is a key concern, as firms need to use outside vendors or integrate technology to apply generative AI to their data. To counter this, technology providers are expected to enhance their security measures in the coming year.
Trust deficit is another major barrier. Despite AI’s potential to enhance efficiency and accuracy, and reduce contract risk, the fact that generative AI can sometimes produce unverified or untrue responses (known as ‘hallucination’) has led to reluctance in its adoption.
In the future, to promote the acceptance of AI in contracts, focus needs to be on providing users with context and control. Tools that suggest contract changes and explain the rationale behind them based on past changes and a company’s playbook could be instrumental in facilitating AI adoption. Additionally, allowing users to override their AI’s rules and algorithms can ensure they maintain control over their contracts amid rapidly changing site and market conditions.
Highlight
- The AI’s ability to draft new contracts, extracting essential data from massive text volumes, and implementing uniform edits across a document also eases the process of contract management.
- Generative AI can sometimes produce unverified or untrue responses (known as ‘hallucination’) has led to reluctance in its adoption.
- In the future, to promote the acceptance of AI in contracts, focus needs to be on providing users with context and control.
READ MORE
Recent Comments