“By 2020, an average desktop machine (costing $1000) will have roughly the same processing power as a single human brain… and by 2050… of all human brains on earth” - Ray Kurzweil’s claim in “The Singularity is Near”.
Undoubtedly this is a time of rapid technological transformation, with Artificial Intelligence (AI) technologies being an increasingly core area of focus for top and mid-tier law firms in their long-term strategy. This is rightly so as leading legal academic and author, Prof Richard Susskind, views this era of change as “an opportunity for some professionals to revisit some of their working practices” in his book, “The Future of the Professions”.
A Deloitte study in 2016 found about 114,000 legal jobs are likely to be automated in the UK alone in the next 20 years. This sort of hype may conjure up images of robot lawyers taking over the work of humans, but this would be to mistake specific AI for general AI. Specific AI uses algorithms to perform particular tasks often routine and repetitive in nature while General AI involves robots thinking, feeling and joining in similar to how humans do. It’s also clear that the technology is nowhere near as advanced as that yet, as AI is currently serving to support and complement the work traditionally done by lawyers.
Here are four areas where AI technologies are complementing the work traditionally done by lawyers.
AI is being utilized to perform due diligence with one major provider, Kira Systems, claiming its system can complete a faster and more accurate due diligence contract review. Kira analyses the contracts to identify the concepts and clauses specified by a lawyer as well as issues which are then summarized in a report, and with the use of machine learning, the software gets smarter as it’s used. Clifford Chance, DLA Piper & Freshfields are just some of the many firms utilising this platform to deliver value for their clients.
Large data sets are mined to produce insights, which can then forecast the outcome of legal proceedings and help drive strategy. Lex Machina’s platform, used by Hogan Lovells, BLB&G and White & Case among others, mines litigation data to reveal trends and patterns that allows lawyers to craft a winning motion strategy for their client. J. Siegel, Director at Dell EMC, warns that rather than implementing one-off solutions over time, law firms need to fully leverage their data on clients via automated solutions that can then be used to generate further insights and thereby greater value for the client.
Legal research is also being made easier by Ross Intelligence, an AI powered platform based on IBM’s famous Watson that beat the two best ever human chess players on a live broadcast of the TV show “Jeopardy!” in 2011. A lawyer with a legal query can verbally ask Ross their question and sophisticated natural language understanding software and machine learning is used to sift through a billion text documents a second to return the relevant information. Ross is currently limited to US case law but with firms using the software reporting a reduced research time and more authorities being discovered resulting in a significant ROI boost, it’s only a matter of time before other firms follow suit.
Document automation is also beginning to make waves in the industry with Neota Logic being a provider of choice for firms including King & Wood Mallesons, Clifford Chance and Bryan Cave Leighton Paisner. Their platform claims to handle any level of complexity, shortening the time taken to produce a document, and uses AI selected templates that you can edit to automate contracts, legal briefs, memos, letters, compliance documents for immediate e-signing. Embracing AI has allowed firms to focus on what clients need at a reduced cost whilst saving time on what would otherwise be quite a costly exercise says M. Sah, Partner at Clifford Chance.
Electronic billing or e-Billing systems are also on the rise, especially among international clients and smaller businesses, allowing bills to be received through a simple electronic interface that can be reviewed and approved by the billing department. What may sound like an easy to implement, cost-saving measure may not be the reality, as Thomson Reuters warns in this article there are likely to be some serious hidden costs involved in the implementation process. But once up and running the chosen platform can help prevent overbilling as well as drive efficiencies. Troutman Sanders, Stephenson Harwood and Sheppard, Mullin, Richter & Hampton are among 413 other firms worldwide leveraging the eBillingHub platform and have benefited from a shortened day pay cycle, increased accuracy and thereby a reduced rejection rate.
“Rather than looking at startups as disruptors or threats, large companies need to start embracing the innovator’s mindset, where threats are often seen as opportunities” - advises Steve Glaveski in The Innovation Manager’s Handbook.
Although implementing new technologies into the business will bring its challenges, and efforts will have to be made to retrain lawyers to gain the most value from them, these technologies could prove incredibly lucrative opportunities for law firms who are planning for the long-term. AI may still be in its infancy but with the implementation of these applications on the rise and with increasingly capable systems becoming available, it is safe to say that the benefits of utilizing these technologies are not limited to the law firm of the future.
In this ebook, we provide a brief overview of Proptech, what it means for incumbents in the real estate industry and what they can do to best prepare and respond to these imminent changes to BAU.