Getting Serious About M&A and AI

Getting Serious About M&A and AI

Technology will drive efficiency in terms of hours, but to get to that, you must invest and develop a tech platform. It would be folly to think it will not have an impact. – Iain Macmillan, Global Head of M&A at Deloitte

If your organization hasn’t integrated Artificial Intelligence (AI) into its M&A practice, you’re behind the curve.  In fact, this quote from Deloitte is not from this year, but 2016.  Now, as we approach 2020, it is clear to see that AI is essential to an advanced, efficient M&A practice.  The key to success, however, is not scrambling to jump on the first product that comes your way.  Instead, the only way to ensure success is to invest in the best AI technology platform for the intended purpose.

For the better part of 8 years, I practiced law at large firms.  During that time, I witnessed first-hand the adoption of new technologies in e-discovery.  True to our reputation, attorneys were slow to adopt these technologies.  Simply put, it’s hard to trust a product as a substitute for your own judgment when you don’t have the time to build a foundational mastery of the underlying technology.  Nonetheless, e-discovery is now the bedrock of court-approved discovery orders and an essential element of any advanced trial practice.

Lessons learned in the adoption of e-discovery are instructive in M&A practice as well.  While organizations have contemplated adopting AI for M&A for a few years, how many have invested in building an AI platform to leverage at scale?  Based on my own experience and that of former colleagues, organizations continually make the mistake of rushing into a new “AI product” when rushing to get through a pending deal.  While it may be tempting to think that a live deal may be a good test case for new technology, that assumption is wrong.  A one-off test case is just that:  One-off.  To truly incorporate AI into a M&A practice, organizations must build platforms that yield repeatable, successful outcomes.

When done right, such a platform will shift organizations from linear production models (gradual progress over time, deal-by-deal) to a single hockey-stick production model (gradual progress up-front, followed by perpetual high productivity).  Like Shoda, Mischel, and Peake’s popular marshmallow study (rewarding children for delayed gratification), platform-based AI will require some patience upfront to yield greater, perpetual rewards going forward in the form of speed and consistent information. The speed and consistency achieved through these platforms will also exceed that of their human counterparts.

Seal Software (Seal) is the gold standard for platform-based contract analysis.  For a decade, Seal has had one focus: Leveraging AI and machine learning to automatically identify contract content.  Put another way, Seal is the industry leader in enterprise contract analysis.  From latent semantic indexing to user-driven machine learning (UDML), Seal has a variety of AI technologies to ensure that its customers have the right tech in place to get to the best outcome.  This is why Seal’s customers include Fortune 500 enterprise legal departments and global consulting and accounting firms.  These organizations recognize the need to have a platform solution for M&A practice, among other contract-driven use cases.  They know that investing time in the adoption of AI is essential for consistent, successful outcomes.  This is their competitive advantage and long-term legal strategy.

A M&A process performed without platform-based AI means sacrifice.  As the number of documents increases and companies diversify, traditional M&A practice must compromise time, quality, or scope to deliver any type of results at scale.  By contrast, platform-based AI means consistent speed and quality at scale.  When platform-based AI is properly incorporated into a M&A practice, scale and time are no longer the challenges.  The platform delivers critical data to M&A practitioners enabling a boost in their ability to shepherd a successful deal.  From pre-transaction to due diligence to post-merger integration, platform-based AI is now the key to a competitive M&A practice.

The question is no longer “where are you today?”  The question is “where will you be tomorrow?”  Without platform-based AI like Seal, the answer is “behind the curve.”

To learn more about how you can leverage contract analytics for your M&A practice, listen to our webinar.