Traction and distraction

Nicholas Carr’s 2010 book The Shallows: What the Internet is Doing to Our Brains highlights the effect of distraction technology on our neural pathways. Websites and apps are designed to encourage us to follow links and flick between multiple resources and tasks. And although the internet makes information easily accessible, the way we use it reduces our ability to concentrate and therefore limits our capacity for deep thinking and analysis.

Similarly, as legal technology gains traction, it is reconfiguring the definition and delivery of legal services and the future of law.

Automation is standardising and accelerating processes, which brings consistency, clarity and agility – the ability to switch rapidly between tasks, monitor and review progress, and highlight potential pitfalls and challenges. But does the digital transformation of law into an ‘agile business’ detract from the qualities that until now defined the profession: knowledge and understanding of the law, combined with the in-depth analysis and problem-solving capabilities that are synonymous with the role of trusted adviser?

AI – mainstream by stealth?

The effects of distrac tion technology may be one reason why artificial intelligence (AI) tools appear to be losing traction in legal. This trend was explored by the International Legal Technology Association’s (ILTA) Tea and AI session. This presented the 2020 ILTA-Blickstein Group Legal AI Tool Usage Survey on the extent to which ILTA members (predominantly US law firms) were using legal tech tools which included some element of AI, and the maturity of their usage, ranging from proof of concept to ‘integral to daily operations’. Unsurprisingly, the most popular uses were contract management (post-execution), e-discovery and document review, insight and predictive tools, and legal research. The findings revealed that the AI tools most considered ‘integral to daily operations’ were well-established legal tech brands now enhanced with AI capability (such as Thomson Reuters’ HighQ collaboration platform and Relativity’s e-discovery solution).

Lawyers aren’t programmed to rush out solutions. They need to understand that tech deployment does not impact on the quality of legal advice – but you have to get the tech right, and that is a fail-fast, iterative process which runs counter to legal training

Andrew Joint, Kemp Little

The American Bar Association’s Legal Technology Survey, published in October, reported a 1% decrease in firms using AI tools, with 23% of respondents saying that their firms were not interested in purchasing AI technology. The top reasons for this were cost and concerns about accuracy (that is, trust).

While these surveys present a helicopter view of legal AI (the ILTA-Blickstein survey analysed the popularity of 100 legal AI products) DocsCorp, which sponsored the session, demonstrated AI-powered email recipient checking – which is a feature of their cleanDocs email security tool. A machine-learning algorithm tracks your email patterns and alerts you if it spots a potential discrepancy – for example, if you have two or more contacts with similar names and/or email addresses and Outlook auto-completes what might be the wrong address. You can override these alerts, but they will draw your attention to a possible human error and stop you sending emails to the wrong recipients. The ILTA discussion highlighted that the most successful use cases for legal AI so far are point solutions directed at specific issues. The email checker is an example of legal AI adoption by stealth. It is intuitive: users are not involved in set-up and there is no extra cost or user training. Consequently, lawyers who use it are unlikely to reference it when responding to a survey about legal AI.

Another potential legal AI inhibitor could relate to the traits that differentiate professional advice. While automating routine tasks enables lawyers to focus on the higher-value aspects of their work, there is perhaps concern that entrusting legal research and analysis to AI engines will distract from what Carr describes in The Shallows as ‘deep thinking’. Will intelligent automation, data-determined decisions and faster, more predictable outcomes shift lawyers’ skills from thinking around complex problems to rapidly manipulating multiple processes?

Automation has commoditised volume work. AI has added value to some specialist practice areas, such as intellectual property rights, and it is – hopefully – facilitating access to legal services via self-service apps. But it is also aligning law firms with the process-driven professional services operations that characterise the Big Four consultancies, all of which are expanding their legal offerings. This, in addition to the uptick in legal tech investment, is breaking down boundaries between different elements of the legal market.

New directions in M&A

The past couple of weeks have seen several cross-pollination deals involving legal tech. Australian law firm Gilbert + Tobin sold its digital disclosure tool to US software vendor Litera. This highlights a different direction in legal tech market consolidation. While it is not unusual for law firms to invest in start-up incubators, accelerators and tech subsidiaries to enable them to develop software products and services to sell to clients and other law firms, it is rare for a law firm to sell outright an in-house software product to a commercial legal tech vendor. In another example of consolidation between two related offerings, legal tech company BigHand, which was sold to private equity firm Levine Leichtman Capital Partners in August, acquired Mason & Cook, whose resource management software and consultancy business complements BigHand’s workflow solutions.

Meanwhile, Deloitte’s high-profile purchase of tech and media firm Kemp Little was the first time in many years that a Big Four consultancy has expanded its legal offering by acquiring an established law firm. Kemp Little’s managing partner Andrew Joint believes that law is evolving into a more diversified business model and sees the decision to join Deloitte as a way of scaling up this strategy. ‘In the past few years, we’ve been building out our  consulting and managed services and developing award-winning standalone technology products,’ he says. ‘We believe that this [diversification] is where law is going but taking it further requires significant investment in technology and expertise. Deloitte has applied this to other professional services, so they have experience in delivering a blended service, rather than building tech products as add-ons.’

Commercial technology partner Emma Wright has led Kemp Little’s work building and integrating bespoke tech solutions. She says that although Deloitte is sharply focused on tech, until now it has not hired tech lawyers. The Kemp Little team brings specific expertise to Deloitte’s legal advisory services, which sit alongside its legal managed services and consulting divisions in a structure similar to that of magic circle firms with tech services working across the three functions.

Somewhat surprisingly for a firm of tech lawyers, culture has been the main sticking point in Kemp Little’s journey. ‘Tech development requires a solutions-led environment and that requires a major mind shift,’ says Joint. ‘Lawyers aren’t programmed to rush out solutions. They need to understand that tech deployment does not impact on the quality of legal advice – but you have to get the tech right, and that is a fail-fast, iterative process which runs counter to legal training.’ He acknowledges that another challenge will be preserving Kemp Little’s entrepreneurial culture post-acquisition.

‘Digital transformation has shown that tech can’t dictate process – the UK government’s contract tracing scheme is a good example of that – and developing successful solutions that deliver value requires a mix of disciplines,’ adds Wright.

Does this mean the future of law is outside the traditional law firm? ‘There will always be a need for law firms, but there is room in the multi-billion-pound legal services market for different types of businesses,’ says Joint. ‘Today’s financial challenges mean that clients are demanding better services. That isn’t necessarily better lawyers. It doesn’t mean the death of law firms; rather that combining resources, expertise and cultures will bring huge opportunities to legal – and consulting too.’

These recent developments indicate how, reflecting Carr’s thesis that human brain function is evolving in response to the tools we use, technology is taking the future of law in unexpected directions.