Research by FTI Consulting and Relativity has found that inhouse lawyers now view genAI technology as very much within their ‘comfort zone’ – and that’s great to see. It also has several far-reaching implications, (see below).
The data collected covers how inhouse lawyers view the use of genAI internally, or by law firms advising them.
In this case, when it came to AI tools for reviewing contracts, 85% said they were comfortable to some degree, with 60% saying they were ‘very’ or ‘extremely’ comfortable with using the tech, or their advisers doing so.
After that came privilege review, doc review in general (i.e. not necessarily just contracts), then e-discovery, and then all the way through to compliance monitoring – which even in this ‘least comfortable’ task position saw almost 40% say they were ‘very’ or ‘extremely’ comfortable with an AI solution.
In short…..what an incredible rate of uptake and familiarisation. Back in 2023 there was plenty of commentary about how inhouse lawyers were nervous about using AI tools, or even their advisers doing so. Well, that nervousness has largely evaporated.
From Artificial Lawyer’s perspective there are several key takeaways here:
If clients are happy to use this tech internally and happy for law firms to use it too, then that has to change expectations. I.e. when a client says: ‘I’m very comfortable with you using AI on this task,’ that’s not just a random comment, it’s an implicit statement that expectations have changed.
That the market for AI tools for inhouse teams is growing rapidly. For years many legal tech companies held back from selling to inhouse groups, unless they were totally focused on that side of the market, e.g. CLM systems. Now, it would appear that with this high level of ‘comfort’, there is everything to play for. That in turn expands the total revenue that legal tech companies can generate.
That as more and more AI tools are brought into inhouse teams, and thus more time can be saved on routine tasks, the views on a whole range of issues become more real, e.g. debates about the billable hour are no longer just academic as GCs can truly see that some areas of work make no sense to be billed based on time alone; while internal discussions about how ‘AI will allow you to do more high value work and be more strategic’ also move from a philosophical debate to something the team really needs to plan for.
And some larger companies may well start to see that they no longer need quite so many staff focused on those routine tasks, e.g. on lower risk contract management.
Overall, it’s remarkable that a technology that arrived to the mass legal market only in November 2022 has already become so accepted. One can only wonder where we will be by the end of the decade.
Last word goes to Renato Fazzone, Head of the Technology segment in Germany at FTI Consulting, who said: ‘We expect nearly all major corporate legal departments globally to actively integrate generative and other AI technologies into their daily operations by the end of 2026.’
Yes, indeed.
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Demographics: The sixth edition of the General Counsel Report by FTI Consulting and Relativity surveyed 207 Chief Legal Officers and General Counsels across a dozen countries globally, conducted by market research institute Censuswide. Additionally, analysts from Ari Kaplan Advisors conducted 34 qualitative interviews.
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Legal Innovators California conference, San Francisco, June 11 + 12
If you’re interested in the cutting edge of legal AI and innovation – and where we are all heading – then come along to Legal Innovators California, in San Francisco, June 11 and 12, where speakers from the leading law firms, inhouse teams, and tech companies will be sharing their insights and experiences as to what is really happening.
We already have an incredible roster of companies to hear from. This includes: &AI, Legora, Harvey, StructureFlow, Ivo, Flatiron Law Group, PointOne, Centari, LexisNexis, eBrevia, Legatics, Knowable, Draftwise, newcode.AI, Riskaway, Aracor, SimpleClosure and more.
Cooley, Wilson Sonsini, Baker McKenzie, Gunderson, Ropes & Grey, A&O Shearman and many other leading law firms will also be taking part.
See you all there!
More information and tickets here.
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