Due to recent updates, if you've installed Contracts for Salesforce before 2021 on a custom object, you must run the Automatic Configurator again on the custom object to prevent issues from occurring with View Redlines. 

Should I do this in Production? 

Only after you test and verify in a development environment first.

How do I know if I am using a custom object with Contracts for Salesforce?

You are using a custom object in Contracts for Salesforce if you've configured an object other than the standard Salesforce Contracts object for use. See CLM (Conga Contracts for Salesforce) Contract Agreement Object and Add View Redlines Button to Standard or Custom Objects for more information and instructions on how to check what object you've configured. 

How do I run the Automatic Configurator on a custom object?

See Using the Automatic Configurator for instructions. 

Will this interrupt any existing approval processes?

You should test your approvals in a sandbox after making the update to ensure compatibility.