Making a case for legal tech

17 August 2021
Law firms need to adapt for the Fourth Industrial Revolution

Arguably, no sector remains untouched by the digital transformation under way globally.

Catalysed by the Covid-19 pandemic in the past year and a half, industries and businesses find themselves in the eye of the technology storm.

The legal sector is no exception.

As one of the oldest professions in the world, many might consider the legal sector to be sluggish when it came to the digitally driven Fourth Industrial Revolution.

Yet change is under way. And players in the sector continue to demonstrate that not only will they not be left behind, but they can in fact lead the way in new forms of innovation applicable outside of the profession.

This shift is increasingly important as organisations harness technology to improve their offering and output, giving rise to a brand-new set of legal issues that need to be resolved.

And so, as law firms keep in step with changes to offer the best service to their clients and stay ahead of the competition, legal technology (legal tech) emerges as a critical differentiator.

Automation improves decisions

The use of artificial intelligence (AI) technology and legal tech programmes can help firms meet their clients' demands and deadlines through the automation of decisions.  

Some practice areas lend themselves to legal tech more easily than others. For example, the work done by AI and technology models during the due diligence stage of a corporate deal has significant benefits.

This shift is increasingly important as organisations harness technology to improve their offering and output, giving rise to a brand-new set of legal issues that need to be resolved.

Often seen as a costly and time-consuming exercise for lawyers, programmes that can alleviate this burden are considered to be a welcome change. Indeed, trials have found that AI can analyse and produce risk evaluations at a staggering speed. There are also obvious benefits in other areas that require regular screening, such as anti-trust and intellectual property.

As an example, Baker McKenzie is welcoming this change and partnering with technology providers and innovation specialists to add value for our clients and increase both cost and working efficiencies. 

In October 2020, Baker McKenzie and SparkBeyond, an AI-powered problem-solving platform, launched a market-first partnership. Together, the two companies will work to identify what kind of services clients will want law firms to provide in the future. Through the use of AI, the two companies can identify drivers of client demand that may not yet be obvious to market observers.

It is not all future casting, however. AI can also be used to eliminate human bias or bottlenecks in problem solving. While this is a key role of the firm's lawyers, the speed at which the programmes can make decisions and provide analysis will transform the speed at which firms can meet both client demands and deadlines.

Solutions such as cloud-based software and automated drafting tools can further streamline the legal workflow and eliminate manual steps that are otherwise time-consuming.

Supporting the industry

There are several other ways in which law firms can get involved in the Fourth Industrial Revolution and there are a growing number of companies looking to collaborate in this sphere.

Baker McKenzie has established a global Reinvent Fellows programme, targeting tangible improvements in the delivery of its client services.

As it currently stands, the firm has 11 fellows running projects across a variety of practice areas globally. The benefits of this type of initiative are innumerable for a law firm: lawyers can better understand their clients, develop a deeper relationship, and clients receive a more efficient and personalised service. Law firms that take advantage of this opportunity will not only be ahead of their clients' ever-changing needs but will also have an advantage over their competitors.

Of course, law firms will want to be careful not to become over-reliant on technology. The relationship between a lawyer and a client has historically been personal, often built on years of service and trust. Naturally, there may be fears that technology will erode this.

As we have seen in other industries, from hotel accommodation to car rental, and online ordering to advertising, all industries need to adapt, and the legal industry is no exception. With several innovative programmes already up and running, the momentum is growing, and the disruption to the legal industry is only just beginning. 

 

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