What is Unstructured Data?
Data takes two primary forms: structured and unstructured. Structured data is every analyst’s favorite. It’s a name-value pair tucked into tidy rows and columns of a database, neatly tagged and easily fed into an analytics engine of your choosing. Unstructured data—what every enterprise creates and struggles with daily—is everything else. Types of unstructured data include those contained in complex document types, like emails, contracts, proposals, agreements, scanned images, or CAD drawings, to name a few.
Think about a contract, for example. Every agreement is different based on the client, industry, number of parties, and the nature of the agreement. Some clients may have agreements with five pages, some may have 50. It makes contract analytics nearly impossible if you don’t have the right tools or technology.
Why Every Business Needs to Manage Unstructured Data
You need visibility and transparency into all your data, but especially your contract documents. And it’s not just visibility into today’s questions, but tomorrow’s too. With unstructured data, it can be hard to see at-a-glance information, like termination dates or important or nonstandard clauses, that impact several critical areas, including:
Organizations must have a predictable and efficient way to dive deep into their data to remain compliant with new and upcoming regulations. Your data may have hidden PII, especially in your agreements and contracts, that are no longer compliant.
Finding this PII means searching through every contract, finding which ones are active, and then narrowing down the exact phrasing or clauses that need to be changed. That’s all unstructured data, and without proper contract analytics, it will be challenging to repaper and remediate contracts—especially for larger enterprises who deal with vast volumes of legacy and net-new content.
Another risk hidden in your unstructured data is unfavourable clauses or auto-renewal with vendors or clients. You may have a particularly nasty non-standard term that you don’t have visibility into, or one you never thought was relevant before.
With so much disruption to the global supply chain during COVID-19, many businesses are looking to invoke force majeure clauses. “Force majeure” is a common clause in contracts that releases both parties from obligation or liability during unforeseeable circumstances, such as a pandemic, war, or natural disaster. When that happens, you must quickly determine whether you need to renegotiate, repaper, or remediate your contracts.
Tapping into the Full Potential of Your Data
It’s not all doom and gloom, though. Unstructured data offers tremendous potential to change the way you do business. Imagine how much more you would be able to learn and see in terms of patterns and trends, and how you could delight your customers, partners, and employees by using data-driven insights to become a better business. Imagine adapting to the changing customer and regulatory landscape swiftly—and being able to find and leverage all your critical content quickly and at scale—versus wasting precious time and resources combing through content manually.
As the speed, complexity, and volume of data in an ever-changing global economy increases—especially for highly regulated industries—automating manual tasks like contract analysis is critical. The threat of new digital competitors and demand from customers for a holistic, personalized customer experience means your unstructured data needs to be surfaced, managed, and mobilized to deliver maximum value.
The Final Verdict
The proliferation of unstructured data in its various forms prevents risk from being addressed with any level of cost-effectiveness, repeatability, or scalability. Without the right technology, answering the questions you have today is like shaking a Magic 8 Ball and expecting an insightful answer: a dicey prospect at best. Organizations who use Contract Analytics software to discover, standardize, classify, extract, and leverage unstructured data reap many rewards: reduced risk, easier compliance, automation, and a whole new level of performance and profitability.