AI integration takes center stage in shaping the law firm of the future

October 17, 2024

The impact of generative artificial intelligence (GenAI) on legal services was the overall theme of Williams Lea’s second annual Law Firm of the Future business services symposium, held at DLA Piper’s office in London. Moderated by Chris Bull, Principal at Edge Consulting, the event featured valuable insights from Abhi Kunté, Head of Partnerships, AI and Machine Learning at Google and Matthew Leopold, Head of Brand and Insight at LexisNexis, who both highlighted the rapid adoption and economic potential of GenAI.

Judith Davis, Business Process Improvement Lead at DLA Piper, Rachel Broquard, Service Excellence Partner at Eversheds Sutherland, and Haig Tyler, former CTO of Herbert Smith Freehills joined Abhi and Matthew to discuss core topics, including: The integration of AI in legal services, the increasing importance of collaboration, robust data management, building stronger client engagement, the evolving role of AI in business operations, and the need for law firms to innovate and adapt to maintain efficiency and competitiveness.

Here are the top takeaways from the event:

AI is evolving at an unprecedented pace, and law firms must be proactive in embracing and integrating these technologies to stay competitive

The rapid evolution of AI, particularly generative AI, has witnessed a meteoric adoption in a short period. Abhi highlighted the need for law firms to be forward-thinking and agile to avoid being left behind by the accelerating pace of innovation. “Two years ago, nobody knew what the term generative AI meant, nobody knew what ChatGPT meant. November 2022 is when that product launched, and by January 2023, it had 100 million users. This is completely unheard of in the technology space,” said Abhi, who shared the art of the possible and a glimpse of Google’s AI development, along with a not-to-distant future where AI can not only examine data and generate insights, but also take autonomous actions on behalf of users. This level of AI-powered assistance can significantly improve productivity and efficiency, which is a key opportunity for law firms to embrace. “Imagine, you have a tireless assistant that can analyze vast amounts of data, spot patterns very quickly, and can generate amazing insights that are quickly actionable. Well, that was yesterday’s AI. Now imagine what it can do if it can actually do those actions on your behalf, tailored to your specific needs and preferences… you’re just starting to see what AI can do.”

However, Abhi also emphasized that the disruption being caused by AI, particularly in the legal industry, is not going to eliminate the need for human interaction. A recent Thomson Reuters study found that 80% of law firms agree that GenAI can be applied to the legal industry, but the majority also believe that it shouldn’t be applied, indicating fears that generative AI can take away the need for their roles. “I think part of that is what people worry about. If generative AI can do all of this, what am I going to do? I hear this all the time, not just from those in the legal field,” said Abhi. “But that’s the wrong way to think about it. Like any other transformation in technology that has happened for us, technology does not shut things down. It actually creates new avenues. We just have to be conscious about not getting stuck in the past and actually moving forward, thinking differently, upskilling, understanding where the innovation is, and being there instead of just being where things were and complaining about disruption. Because disruption is constant. It happens all the time. We just have to move forward with it.”

GenAI is building a growing expectation among clients for law firms to adapt their billing practices

Clients have high expectations for law firms to utilize AI, and firms must proactively address these expectations through transparent communication and responsible integration. Matthew cited recent LexisNexis research that showed that a significant majority of clients expect law firms to use AI technologies, and they want to be informed about its use. In fact, 71% of in-house general counsels are not only  happy for law firms to use generative AI, they expect it. However, there is a disconnect between what law firms think clients want and what clients actually want, as Matthew pointed out, “59% of law firms think that their clients want to be told that AI is being used. 77% of clients say that they want to be told.” Therefore, law firms must proactively engage in open dialogues with their clients to understand their expectations and preferences around AI integration in order to build trust and demonstrate their commitment to responsible AI adoption.

Interestingly, studies have also revealed that there is a disconnect between law firms’ and clients’ expectations regarding the impact of AI on billing practices. While a growing number of law firms anticipate changes in billing models due to AI, clients increasingly expect a reduction in billing as a result of AI-driven efficiencies. “80% of Fortune 1000 executives are expecting billings from outside counsel to be reduced as a result of generative AI efficiencies. However, only 9% of law firm partners say that their clients expressed this expectation,” said Matthew. “Law firms need to make sure that they’re having these conversations with their clients, or else we’re going to end up with mismatched expectations.”

GenAI presents both opportunities and challenges for law firms, requiring a balanced approach to innovation and data security

Law firms are grappling with how to leverage the power of generative AI while ensuring the security and integrity of client data. On one hand, generative AI presents exciting opportunities to enhance legal service delivery, as Rachel Broquard said, “Clients are wanting to come and talk to us about the way that we’re delivering services. It’s something that we’ve been building on for many years, and generative AI is the latest iteration of that, but it’s around driving that service excellence through well designed, tech-enabled service delivery. The power of this technology is exciting, and there’s lots that we can do with it, but it’s early days.”

However, law firms must balance this innovation with robust data protection measures. As Rachel noted, they need to be selective in partnering with suppliers, ensuring those providers can safeguard client data to the same standard as the law firm itself: “We want to work with suppliers that we know and trust, because they are key to us for keeping our data, and our clients’ data, secure.”

Matthew Leopold also emphasized the need for human oversight and involvement in the use of AI, in order to address issues like bias, security, and the review of AI-generated outputs. This “human in the loop” approach is crucial for law firms to adopt when integrating AI technologies into their practices, as he said “We need to have oversight, understanding and a recognition of the bias and work to mitigate it however we can. Sometimes we can do that with guardrails. Sometimes we need humans in the loop, making sure that gen AI tools are as tight and as secure as possible, that the confidential information you put in remains confidential … all of these things are very important to consider.”

Successful adoption of generative AI depends on leadership engagement, collaboration, and a focus on user experience and change management

By ensuring strong leadership support, fostering cross-functional collaboration, and dedicating resources to user experience and change management, law firms can drive more successful implementation of generative AI technologies.

As Haig noted during the panel discussion, active engagement and buy-in from leadership, particularly within practice groups, are both crucial for successful adoption. “The best opportunities for GenAI were seen in practice groups where the partner leadership was actively engaged and bought into the technology,” said Haig. “It almost wasn’t about saying that a particular task was perfect for GenAI, it was about the engagement from the top, from the leadership of that practice group, that is where we saw success.”

Cross-functional collaboration in understanding the capabilities of GenAI and how best to apply it is also crucial. “We recognized that only through collaboration would we work out what (generative AI) was good at. There was no one in the project team, be that the legal operations, IT, the suppliers we were dealing with, or the general counsel, that really knew what it was good at,” said Haig. “Those firms that truly partner with their clients to take (GenAI) forward, understanding what it is they want and partnering with them to produce capability that both sides will benefit from. I think those will be the winners.”

Along with leadership and collaboration, there is also a need to prioritize the user experience and provide robust training and support to facilitate adoption. Judith Davis discussed DLA Piper’s efforts in this regard, “We’re going to be putting quite a lot of time into training and helping not only practice groups but also business services, because I think we should not forget them, to really take on generative AI tools and learn prompting.”

Learn more about how Williams Lea can help law firms boost efficiency within their legal support services and evolve for the future here.