Evaluating Your Contracting Efficiency: Our Approach

Contents
What is Maturity Assessment? How is Maturity Stage Calculated? Efficiency Gains: Supporting CalculationsSources

What is Maturity Assessment? 

A clear snapshot of where you are today in terms of contracting efficiency and where you can improve. This diagnostic identifies gaps, pinpoints opportunities, and helps chart a path toward streamlined, strategic contracting.

How is Maturity Stage Calculated? 

We assess your organization’s maturity across four core pillars (People, Processes, Policy, and Tools). There are 5 maturity stages, namely survival, functional, Efficient, integrated, and scalable. There is also an over-extended stage, which is when you are efficient, but there is a lot of burnout. Each scored on a scale of 1 to 5, 1 = Survival | 5 = Integrated & Scalable

The calculation is based on your input, which primarily are: 

  • Number of contracts per month
  • Total team size
  • The turnaround time you typically take to process each contract.
  • contract type
Mostly Basic
→ Contracts that are standardized, low-risk, and rarely negotiated, eg, NDA’s, Employee Agreements, Privacy Policies
Mixed
→ Contracts that may start from a standard template but often require moderate customization or redlines depending on counterparty or use-case, eg, Partnership or Co-marketing Agreements, DPAs, MSAs
Mostly Complex
→ Contracts that are highly negotiated, risk-sensitive, or involve multiple stakeholders, eg, Investment / Equity Funding Agreements, IP Licensing or Transfer Agreements, M&A Agreements

Based on your input, we calculate the efficiency parameters

Throughput Score
→ Formula: Contracts Processed ÷ Target Contracts
→ Measures volume efficiency
Turnaround Score
→ Formula: Your Avg. Turnaround Time ÷ Optimized Turnaround Time
→ Measures speed efficiency
Overall = Min(Throughput Score, Turnaround Score)
→ Conservative indicator of the weaker of the two metrics
Maturity Stage
Condition
Interpretation
Survival
Throughput < 30% and Turnaround < 30%
Very poor on both speed and volume – severely inefficient
Over-extended
Throughput ≥ 90% and Turnaround < 60%
Great volume, but too slow – speed bottleneck
Functional
MIN(Throughput, Turnaround) < 50%
One side is underperforming – clear inefficiencies
Efficient
MIN(Throughput, Turnaround) between 50%–80%
Moderate performance – some optimization needed
Integrated & scalable
MIN(Throughput, Turnaround) ≥ 80%

Strong performance across both metrics

Efficiency Gains: Supporting Calculations

How Much Contracting inefficiency is costing you? 

We calculate this by estimating the number of hours lost each month to unnecessary manual processes—what we call the monthly drag. Based on historical data, SpotDraft helps companies recover approximately 70% of this drag. We multiply the recovered monthly hours by 12 to get the annual time savings, and then multiply that by $48, the typical hourly rate for legal professionals, to quantify the yearly cost savings.
Dollar Value of Contracting inefficiency = Recovered hours × 12 × $48 (avg. hourly rate of legal teams)

Contract Drag

Contract Drag measures delays in the contract lifecycle that slow deals or increase risk.
It’s calculated as:
Hours Wasted = (Actual Turnaround Time – Optimized Turnaround Time)

Deal Velocity Impact

This gives you the total number of days lost due to slower contract processing compared to industry standards. A higher number means slower deal velocity and potential revenue delay or operational bottlenecks.
Deal Velocity Impact = (Your Avg. Turnaround Time − Industry Benchmark Turnaround Time) 

Legal Talent Utilization 

This metric compares the number of contracts your team should ideally process (based on industry benchmarks for your team size) to what you’re processing.
Contract Throughput Gap = Industry Benchmark contract per month Volume – Your Current contract per month Volume
A large gap means your legal team may be spending too much time on low-value, manual tasks instead of strategic work. Highlights the underutilization of legal capacity and operational inefficiency.

Resource Drain

This metric calculates the hours left on the table due to operational inefficiencies. It captures the gap between your current drain and what optimized drain legal teams have achieved with modern tools and streamlined processes.
Contract drag that you could have done away with  = Contract drag (Time used for your contracts *7) - Optimized drain ( Contract Drag * 0.30**) 
*0.30 (30%) = Time Saved Through Optimization
Modern legal teams using automation, templates, smart approvals, and AI-driven tools have been shown to reduce contract turnaround time by up to 30% or more.
0.70 (70%) = Residual Inefficiency or Time Still Wasted
This represents the portion of contract drag still impacting teams that haven’t adopted optimized processes. ( These figures are based on our internal observations across multiple customers)

Human effort spent on contracts overall

Human Hours Spent = Number of Contracts × Complexity Multiplier
Where the Complexity Multiplier is based on the contract maturity stage:
  • Basic contracts → × 2
  • Mixed contracts → × 4
  • Complex contracts → × 7
  • Time studies across customers: Complex contracts take ~3–4× longer than basic ones.
  • Workflow depth: Basic contracts involve ~2 manual steps, complex ones ~7+.
  • Implementation data: On average, basic contracts take ~30 mins, mixed ~2 hrs, complex ~4+ hrs

Faster Turnaround (%)

This shows the percentage improvement possible if your team reached optimized turnaround times.
A higher value = more room to speed up your contract cycles.
Faster Turnaround = ((Optimized Turnaround – Your Turnaround) ÷ Your Turnaround) × 100

Hours saved for legal

This estimates the total Monthly hours your legal team could save by automating manual work, assuming a 70% efficiency gain, based on SpotDraft’s observed impact.
Hours Saved = Time Spent per Month × 0.70 

% Improvement in Contract Throughput

This measures how much your contract throughput could improve based on your team size and contract complexity, compared to what you're currently handling.
Percentage Improvement = ((Target Volume – Current Volume) ÷ Current Volume) × 100

Days Reclaimed per year 

We assume lawyers spend an average of 10 focused hours/day across contract review, approvals, and redlines. Dividing total contract drag hours by 10 gives a realistic estimate of how many full working days could be reclaimed annually through automation.
Days Reclaimed = Contract Drag Hours per Year ÷ 10