And other insights for in-house leaders ready to embrace the future
How fast will artificial intelligence (AI) permeate the legal industry? Well, that depends a lot on in-house counsel and technology companies. That’s according to a recent Thomson Reuters Institute presentation at the Synergy conference, entitled Embracing the Future.
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In the presentation, Institute leader Mike Abbott outlined research findings that connect legal department priorities to the efficiencies legal teams and their businesses can realize from AI-powered tools.
He also acknowledged that there is sometimes a disconnect between what corporate clients need from their outside counsel and what law firms are readily able to deliver, especially in terms of pricing and efficiency. He encouraged attendees – mostly in-house lawyers and corporate counsel from major global corporations – to lead the way on AI adoption. He said that, together with technology companies, these clients will set the pace and way legal professionals realize the benefits of AI.
Abbott explored the following key points:
- There are four areas of strategic focus for legal department leaders
- Demand and investment in legal services is up, but so is cost pressure.
- Aligning goals to metrics and taking a longer-term view will help legal departments to be viewed as strategic leaders
- AI will have a transformative impact on professional services over the next five years
- In-house teams and technology companies will be the strongest influencers of adoption.
Areas of focus
There are four areas of strategic focus for legal department leaders. These include the following:
- Providing effective legal advice
- Optimizing efficiency
- Protecting the organization
- Enabling the business’s goals
In-house teams tend to focus on legal advice and cost efficiency, and not enough time on risk and goals. “You need to kind of expand that out and force the issue,” Abbot suggested.
Demand balanced by cost pressure
Legal teams are managing a delicate balance. Companies’ need for legal services is increasing, but they are also pressuring their in-house counsel to meet the demand with the same or lower budgets. Legal teams are investing in technology to change the way they deliver services and to manage their outside counsel spend more effectively. This will clear the way for them to increase the higher-level work they deliver to the business.
Legal teams being seen as strategic leaders
While legal teams navigate the higher demand / lower resources balance, they are also working to measure the things that truly matter to the business. That means aligning their goals and metrics to the growth, cost, and risk priorities of the organization. Aligning goals to metrics and taking a longer-term view will help legal departments to be viewed as strategic leaders.
The transformative impact of AI
AI will have a transformative impact on professional services over the next five years. It will help companies and professionals increase efficiency while opening new ways to manage risk and develop talent.
Abbot noted that this is a time for leaders to emerge. “If you can be the champion or one of the champions within your organization as it relates to AI and other technologies, do it. Don’t be a laggard.” It’s okay to be guarded, he said. The ones who are “cautious, enthusiastic, and optimistic will do the best.”
And if you’re just waiting for AI to go away? “That’s not going to work,” he said. “It has to be proactive adoption.”
In-house teams and tech companies lead the way
In-house teams and technology companies will be the strongest influencers of AI adoption among legal practitioners. Together, they will define and develop many solutions that the rest of the industry uses. Having the end client involved in design will build trust and encourage firms to adopt new tools more easily.
Abbott noted that the data shows that AI will change the way you think about talent, too. He recounted an insight from an in-house attorney earlier in the conference. What kind of talent should you be recruiting right now when you know an AI is on the doorstep? It won’t be a wholesale switch to AI expertise, he said. “What I need are the candidates who are the most well-rounded, who are skilled in the areas that we need as an organization, not somebody who just knows AI.” The attendees noted that the technology landscape we see today will continue to shift, looking very different in three to five years.
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“This is very much a transitional period,” Abbott said. He concluded saying that it will be the well-rounded in-house teams, curious about how AI and technology can help them grow, who will shape the future. They will be seen more and more as strategic leaders while advising on the law, protecting their businesses, and contributing to growth strategies.
Generative AI is here for corporate legal departments. Don’t get left behind.
