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Posted in: Artificial Intelligence

Mar 6, 2018

Legal Tech and the Changing Legal Services Industry

Weekly Update - March 6

By Aaron Baer

Quote of the Week

Rogers — he of adoption curve fame — opens his textbook, Diffusion of Innovations (5th Ed), with a case study of a health worker who spent two years failing to convince a Peruvian peasant village to boil water. The village had a public health crisis. Boiling their drinking water would solve it. Only 11 out of 200 families accepted and incorporated a simple practice that was free and would deliver immediate, tangible benefits...

How about doctors? There is an eerily similar story to tell about the decades it took doctors to accept and start to apply the empirical evidence that washing their hands before surgery was in the best interest of their patients...

Each story resembles the legal market in some way. We want to pull our hair out because it often seems like only outliers are willing to incorporate the obvious and practical (boiling water). A major impediment to innovation is autonomy-loving professionals resisting reasonable recommendations to modify their behavior for the benefit of their clients (unhygienic doctors). Mix in some exogenous shocks—like the Great Recession—and some automation anxiety (chess). And you get slow, uneven movement towards a new normal (NBA) as regulations, systems, skills, and mindsets incrementally co-evolve.” (D. Casey Flaherty)

(If you’re interested in a very interesting, albeit very long read, the full article is available here.)

Three Articles Worth Reading

Topic What's the Article About?  Key Excerpt Why it Matters 
How Clients View Innovation in Legal Services (George Beaton)  Results of a late 2017 survey from corporate clients of Australia’s largest law firms. 

When asked ‘What makes law firms innovative’ only 15% gave answers related to any kind of technology.

To beaton, this is not unsurprising; in the office towers of Australia, in-house lawyers grapple daily with many more things where innovations, other than technology, would make a big difference to getting work done in a better, faster and cheaper way.

Startlingly, more than one in four of all respondents replied ‘Nothing’ when asked whether they could name any law firm they would regard as innovative. 

To many, innovation in legal service delivery is synonymous with the increased use of legal tech. Firms that are implementing legal tech may see themselves as innovative simply by having purchased off-the-shelf technology.

And while some clients may perceive firms that use legal tech as innovative (which says something about how low the bar is), the survey results demonstrate that most clients are focused on things other than legal tech. Firms that focus solely on legal tech – and ignore process improvement, billing structures and data – run the risk of thinking they are doing enough to prove to their clients that they are innovating. The fact that 1 in 4 respondents indicated that they couldn’t name an innovative law firm says something about how the innovation efforts of law firms have been perceived to date. 

Lawyers vs. AI  A 40-page study from Lawgeex highlights how LawGeex’s artificial-intelligence solution performed much better than the average experienced lawyer in reviewing and marking-up NDAs. 

The media had a field day with the results. Here are a few of the headlines:

While the media loves playing the AI vs. human card, the reality is that AI is a tool that lawyers are going to use to augment their legal practice. Of course, there is little doubt that AI will replace certain tasks that lawyers once performed. But nobody should be concluding from this study that the days of lawyers are numbered. And unsurprisingly, the LawGeex report goes on to say exactly that. 
Technology: Law’s Collaborative Catalyst (Mark Cohen)  How technology is changing the legal profession. 

Technology is transforming law from a sole-source, clubby, homogenous, tradition bound, pedigree-centric, labor-intensive parochial guild into something entirely different...

Technology is the nucleating force of a new legal culture that is transparent, collaborative, diverse, cross-border, data-driven, problem solving, tech and process centric, diverse, inter-disciplinary, merit-centric, flat, pedigree-agnostic and innovative. This is replacing the incumbent legal culture that is parochial, fragmented, labor-intensive, lawyer-centric, risk and change-averse one that was designed, regulated, and dominated by lawyers for their own benefit. 

In yet another excellent article for Forbes, Mark Cohen discusses the impact that technology is having on the legal profession. Of course, Mark is not saying that purchasing a legal tech product and implementing it at a law firm is going to radically change the legal profession. Rather, as Mark notes, a new legal culture is emerging that cares about data-driven solutions and focuses on using technology and process to innovate.

This culture was evident at the Global Legal Hackathon (which I attended last weekend in Toronto, and which Mark mentions), as well as at the Legal Innovation Zone at Ryerson (at which I am currently based, and which Mark also mentions).

But, as Mark notes, with technology becoming more abundant, it’s even more important that lawyers hone their emotional intelligence skills to become trusted advisors. Great lawyers will leverage technology, but they also need to be great communicators who build trust and confidence with their clients. 


Upcoming Event

Event  Details  Cost and Registration 

AI Legal Challenge Forum

“Join us on Friday, March 23 for discussions with leading industry experts on how to take advantage of AI technology or risk falling behind.

Also, don't miss The Final Pitch of the AI Legal Challenge, where three of the six final startups will be selected and awarded seed money totaling $80,000.“ 

Friday, March 23 (9:00 a.m. – 2:00 p.m.)

Lunch is provided.

Event is taking place at the Ted Rogers School of Management at Ryerson University (55 Dundas Street West). 


Click here to register 

Who to Follow

Interested in learning more about Legal Tech?

Consider following Casey Flaherty (@DCaseyF), a legal tech consultant and former in-house counsel at Kia Motors. Casey also blogs regularly at geeklawblog.com.

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