By Kathryn Lye, Definely.
While the dynamics between in-house legal teams and their panel firms have been steady for a long time, the acceleration of AI and legal tech have begun to evolve those dynamics considerably in a short space of time.
Does the impact of AI mean problems for firms, as more functions are brought in-house? Or does it mean a better relationship between firms and clients?
In this article we’re going to look at that relationship and why we believe it’s a huge opportunity for organisations that take the right approaches.
Same panel – different pages: The collaboration gap.
Following our recent survey on AI Adoption, there’s clearly a drive for investment in AI and automation, with 50% of in-house teams saying that these are the top drivers for their legal tech investments and 49% of firms – although 33% of lawyers aren’t using AI at all.
This would suggest quite a lot of alignment, even if in-house teams are more likely to favour automation than firms. But it turns out there’s a lack of clarity about AI and legal tech adoption between firms and clients.
Almost two-thirds of respondents (64%) don’t even know if their external counsel is using AI. 54% of UK in-house counsel are sceptical about whether their panel firms are adopting AI, while half (48%) of law firms say clients have ‘never mentioned’ legal tech.
This suggests that the conversations aren’t happening enough (if at all).
This lack of communication can lead to a number of potential problems. These could include firms not being prepared for fundamental changes that their clients expect them to make (or only finding out about it when it’s too late). After all, 30% of in-house counsel say it’s important for their panel firms to use tech for efficiency and collaboration.
There’s also a danger that, by not communicating, the client and firm end up diverging in terms of the AI and legal tech tools that they do use – replacing efficiency with tools that don’t operate together and introducing blockers and barriers where they didn’t exist before.
Shared information and understanding could be useful – especially when 30% of respondents cited lack of understanding AI tools as a barrier to adoption. This can make it difficult for firms to find the right tools (and see through the sales hype that some vendors use).
We also recommend that firms and clients have conversations about AI and automation because there could be a lot to gain by working with the same tools.
Collaboration isn’t just a buzzword
As part of the survey, we asked whether AI would make work between firms and clients more competitive or collaborative. 60% admitted they didn’t know what to expect.
While 8% predicted increased competition, almost twice as many (15%) expected it would mean more collaboration.
It’s important to remember the drivers behind the adoption of AI – it’s not just about lower costs. It’s about smoother workflows and smarter communication, rather than siloed systems and ad-hoc processes.
This is being seen more in the US, with over a quarter (26%) of firms saying they felt pressure to adopt legal technology specifically to improve collaboration with clients.
We believe that AI tools should augment lawyers, not replace them – and that the human element is absolutely vital. There’s the opportunity for tools to make the relationships better, and allow firms to deliver better and more useful work.
And this is what the right AI tools can deliver – a better, more streamlined working relationship between clients and firms.
Working together with the same tools
Legal tech tools, at their best, should create space for thought, not toil. And we’ve all had the experience of working with tools that created almost as much (if not more) work than they saved. But I’m also sure that a lot of us have had a similar experience with third-parties, whether agencies, freelancers or external partners.
Different working methods, different tools and different workflows can all get in the way of productivity. And that’s why the big question you should ask is whether you’re there to help with the thought or the toil?
If your main source of work with clients is something that can be automated or sped up, then that value is something that probably is at risk as the industry evolves. As in-house departments start building out more capacity (as we’re seeing in the US in particular), they’re looking to take on more of that kind of work themselves. AI and automation tools allow them to do that at a scale that budget has precluded in the past.
However, if the work you’re able to help with is more strategic, more thought-led and more valuable, then this evolution will likely support it and increase it rather than damage it. By speeding up repetitive tasks and reducing some of that labour that we all know too well, space is created for genuine collaboration and valuable work.
The more value you bring to the table, the more likely you are to be able to thrive with the introduction of AI and automation. The less value you actually bring, the more at risk you’re likely to be.
How AI will redefine collaboration
AI and automation are going to be game-changers, but they’re not game-enders. This is, in some ways, a long-overdue evolution of how firms and clients work together.
Clients expect smoother, more collaborative and communicative relationships. And looking at the investments that firms are making, this is expected by firms as well.
First of all, both sides need to recognise the need for the conversation around expectations and technical needs. This means that the relationships can grow more productive, rather than introducing chafing points (that will only become more difficult to bridge over as time goes on).
And, of course, it’s important to find the right tools to help that collaboration. That means tools that are designed with legal work in mind, and tools that can either be used by both or can support what both are using.
Find out more about the Definely Suite.
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[ This is a sponsored thought leadership article for Artificial Lawyer by Definely. ]
