Challenges in legal are intensifying but the good news is that the commensurate opportunities are there for the taking. Believe it or not, this is not (only) a conversation about artificial intelligence (AI).
Aalia Manie and Claire Bestbier
Several trends are exacerbating the already demanding role of the lawyer, characterised by the navigation of constant change, growing complexity, and more uncertainty.
This article examines these trends and offers a strategic framework for effective adaptation, emphasising the need for agility, experimentation, and prudent decision-making to ensure operational efficiency and a positive return on investment (ROI).
Generative AI in legal practice
The advent of generative AI technologies in legal practice is revolutionising how legal services are delivered. Legal departments face the critical decision of whether to build, buy, or partner to integrate these AI solutions.
This decision involves considering the cost, expertise required, and the potential impact on service delivery – all the while ensuring that it will solve a major pain point, drive significant value, and be adopted widely enough to justify the investment. While this may seem obvious – it truly is easier said than done.
Legal departments should adopt a stance of agility and experimentation with AI, piloting small-scale implementations to assess their effectiveness. Any AI adoption should be backed by a solid business case, ensuring that the investment yields a positive ROI while maintaining project integrity and client satisfaction.
Change management and AI adoption
Successfully integrating legal operations and technology into legal practice requires effective change management:
- Create a compelling vision: Develop a clear and compelling vision for AI adoption. Articulate and communicate how AI will enhance efficiency, improve decision-making, and contribute to the overall success of legal operations.
- Leadership support: Ensure strong leadership support for AI adoption. Leaders should champion the change, set an example by embracing AI themselves, and communicate the strategic importance of AI to the organisation.
- Educate and train staff: Ensure that legal teams are trained and comfortable with AI technologies.
- Monitor impact and adjust strategies: Continuously monitor the impact of AI on workflows and adjust strategies as necessary.
Alison Mellon and Thomas Erskine 9 Jan 2024
The efficiency paradox and legal operations
More and more – but from less and less. The ever-increasing pressure to deliver more with fewer resources in tighter timeframes remains a significant challenge for corporate legal departments. According to a study by the Thomson Reuters Institute, 65% of legal departments are handling more work with limited or shrinking budgets.
Addressing this "efficiency paradox" requires a careful analysis and multi-faceted approach to address workload intake and distribution, cost-effective resource management, and operational excellence to increase productivity and reduce risk.
The concept of legal operations has been around for some time internationally but has taken hold in Africa. Corporate legal departments are increasingly exploring operational frameworks to drive better outcomes in their teams. Examples include increased use of managed outsourced services, flexible staffing models, and legal technology adoption.
Due to the growing complexity of implementing sophisticated technologies in legal services, we will increasingly see some legal service providers offering clients holistic solutions that bundle legal advice, implementation, legal managed services, and technology, rather than leaving corporate legal departments to procure and implement technologies themselves.
Navigating legal complexities with agility
The legal sector's evolving landscape, marked by regulatory changes and increasing complexities, demands a nimble and strategic approach. Legal departments must continuously update risk assessment protocols and adapt their strategies to respond to legal changes effectively.
Tracking compliance rates and resource allocation for legal adaptations helps legal departments measure their success in managing these complexities and refine their strategies accordingly.
Talent management in the digital age
Effective talent management is crucial in the war for scarce skills – multi-disciplinary skilled legal professionals with technology, business and operational experience are rare.
An effective talent strategy will involve balancing skilled professionals as part of permanent staff, while considering the flexibility of alternative staffing models like outsourcing or flexible resourcing.
It is also important to monitoring staff turnover and satisfaction to allow for fine-tuning talent management strategies, ensuring the right balance between expertise and adaptability.
Actionable checklist for legal departments
- Conduct regular workload and cost-benefit analysis: Evaluate workload distribution and resource allocation for maximum efficiency.
- Update risk management strategies regularly: Stay agile in legal strategy to adapt to regulatory changes.
- Assess AI integration options and pilot: Decide whether to build, buy, or partner for AI solutions based on cost, expertise, and specific needs. Experiment with AI on a small scale to evaluate its effectiveness and integration into existing processes.
- Develop strong business cases for AI: Ensure AI investments are backed by solid business cases for a positive ROI.
- Implement effective change management: Educate and train staff for AI adoption and continuously monitor and adjust strategies.
- Balance talent management with AI integration: Monitor staffing models to maintain a balance between expertise and flexibility in the age of AI.
By embracing these strategies, including the judicious adoption of generative AI, corporate legal departments can effectively adapt to today’s challenges. This approach ensures sustained growth, enhanced efficiency, and a strong return on investment in an increasingly digital legal landscape.
