7. Impact of technological advancements on the legal industry

Jonathan Nessler (US lawyer and legal tech commentator) defines legal tech as technologies that can help law firms acquire more clients, more effectively and efficiently serve clients, as well as technological advancements including Blockchain and AI. The latter two are currently being identified by researchers and commentators as having the potential to disrupt the legal profession in an unprecedented manner. In this article, we will explore how Blockchain, AI and Agile Working are shaping the legal industry, as well as how legal practitioners can prepare for the digital disruption.

The Law Society in the United Kingdom released the 2019 LawTech Adoption Research in which they found that the number of lawtech companies have increased in recent years, but the number of legal practitioners adopting lawtech has remained constant. Thus, it may be argued that the way that firms are choosing to adapt to the advancing technological environment is proving to be a challenge. As much as traditional firms may disagree to technological solutions, the figure below illustrates the pressure from different stakeholders to adopt new technology.

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Source: LawTech Adoption Research 2019.

Blockchain

The transparency and accountability that blockchain offers has attracted the attention of the legal industry. For those who are unfamiliar with the technology, the blockchain is a decentralised public ledger that records transactions and eliminates third-party processors. Transactions are connected to unique user IDs and recorded, which allows users to remain anonymous. Aside from eliminating third party interference, another primary benefit of the blockchain is the increased security and verification which minimises the risk of data breaches. Within the legal industry, blockchain has the potential to redefine automation, security and contracts.

By implementing smart contracts into the industry, legal professionals may store digital information on the blockchain and share it with the relevant parties as required in real-time. In terms of security, the blockchain can verify information and identities to mitigate the risks of fraud. Further, the high level of security and automation eliminates the need to draft contracts in courtrooms.

AI

As it currently stands, artificial intelligence is a form of automation whereby AI software can be trained to gradually learn and adapt. The forms of AI that are currently being adopted by the legal industry include chatbots, predictive coding and voice dictation. The former is currently being used primarily in place of, or in support of reception support. Website visitors are directed by the chatbot to the relevant information or contact person. Predictive coding is a highly complex tool which assesses the relevance of a collection of large numbers within documents for electronic disclosure. As such, this AI tool arguably displaces particular roles within the legal industry, for example, routine tasks carried out by paralegals. Finally, programs such as the SpeechWrite 360 voice recognition can gradually adapt to the user’s voice to become increasingly accurate over time. Such software goes beyond mere dictation and allows users to implement a variety of voice commands, including composing a new email or printing a document.

Having the ability to automate routine tasks and customise to individual requirements can potentially enable lawyers to change both how they work and how they provide legal services. These changes illustrate the entry of the ‘disruption’ element. Doubtlessly, there will be further automation of tasks which are costly, time-consuming and currently being performed manually. Lawyers will be free to focus on practicing law and providing legal advice for clients rather than being slowed down by time-consuming administrative tasks.

Agile working

Agile working, otherwise known as working in the Cloud entails that lawyers may work flexibly in terms of schedule and location. As a result, this will significantly reduce expenditure associated with the maintenance of physical workspaces. However, law firms must implement reliable and secure Cloud-based practice management in order to achieve successful agile working. Cloud technology makes it easier to register and immediately begin testing new products, often for free or low-cost trials. If the user is unhappy with the product or finds a better alternative, they can simply turn it off. Additionally, integrations are a lot simpler with cloud software. Rather than looking for a single solution and stick to it forever, the user can select their preferred specialist products for specific issues, and combine them with existing or new systems, changing them as required.

What can law firms do to prepare for the digital disruption?

As this article has detailed, technological advancement can improve the effectiveness and efficiency of the legal industry greatly. However, it can simultaneous pose long-term threats, such replacing jobs. As Adlam in his 2019 article ‘Legal tech in New Zealand: Where’s the disruption?’ states, the most significant challenge in terms of universal adoption of new legal technology is that many lawyers simply prefer the traditional method of working. Meanwhile, in the UK, a quarter of new legal service firms have introduced or improved a service within the last three years. At the same time, an entirely new landscape of legal tech start-ups has emerged.

Firstly, to mitigate potential long-term threats posed to the industry by technology, it is recommended for law firms to adopt it and use it to their advantage before competitors. As the world changes, law firms must also change. Sustainable law firms will innovate by leveraging new technology to deliver more efficient, effective services for their clientele. The firms that fail to do so will be left behind as the market becomes increasingly competitive. Simultaneously, it is equally important for firms to first evaluate and assess the areas where technological solutions can benefit their firms and only implement the tools that are most relevant to their practice.

Secondly, it is important to remember that technology is not one-solution-fits-all. Technology cannot and will never be able to be all-encompassing in their tasks. Critical skills such as analysis, judgement and problem-solving cannot be replaced by technology. However, technology can now be used to assist in doing so. Rather than attempting to replace all human tasks with technology, it should be used in a way to make lawyers’ lives easier, and more efficiently and effectively meet clients’ needs. Law firms and lawyers must come to the realisation that lawyers AND tech can survive concurrently, rather than lawyers OR tech. 

While technology can assist lawyers to work more effectively and efficiently, it can do so much more if more lawyers dropped the assumption that legal work can only be completed by working long hours. With the effective implementation of legal tech, the industry could see real progress in terms of access to justice, firm culture and part-time work if lawyers were to open their minds to investing in better outcomes and changing the traditional way of working.