Legal IT Insider spoke with Joy Heath Rush, CEO of the International Legal Technology Association, about the changes that have taken place over the past year; the challenges facing law firms; how IT teams are impacted; and her calls to action moving forward.
What are the key shifts you’ve seen in 2023?
Aside from the obvious, this year I saw a lot of changes in the organisational dynamics inside of law firms and a realignment of their staff functions. Information governance is at the top of the list. Information governance used to be called records management, but it is much more now. Firms are creating cross functional teams and looking at different solutions. Although in the corporate legal sector information governance has been mature for a long time, within law firms there is no one way for how it works: it’s very cultural and they are trying to figure things out.
Another interesting thing that has resulted in real shifts in organisational dynamics is whether law firms have an innovation function or not. For the ones that do, often the AI journey has landed in the innovation team’s lap, so they have needed to develop expertise very quickly. Where a lawyer might have come to them and said, ‘I need to compare PDF files, can you tell me the different ways?’, what I’m now hearing is that lawyers are coming to the team and saying, ‘I want to use, AI, what should I use?’ They are not giving them a specific outcome to find or build a solution. That requires expertise on what is available in the market. Also, when you’re comparing PDF files, there are no ethical considerations, but if you want to use ChatGPT to draft a brief, that requires a discussion. The global regulatory climate is so volatile and global organisations are dealing not just with the general uncertainty, but the varying regulatory position across jurisdictions.
One of the things that we’ve seen a lot in the past year in terms of generative AI, is organisations trying to jump from buzz to biz. There’s all this buzz and new technology but hey, wait a minute, there are products that utilise the technology and that can benefit the practice. It’s how you take it from industry buzz to tools that we use in our organisation.
What I find encouraging is that firms are willing to have the hard technical and the hard ethical conversations at the same time. In many cases, they are establishing formal structures such as committees to do just that. Firms were already having fundamental conversations about the nature of work thanks to the pandemic. They are having serious conversations about what quality legal work looks like and how we define that. You have to have the right mix of technology and human intelligence on each matter and that may look different from matter to matter. With easy, in person training no longer always available, the pandemic has forced firms to think differently about how they train young lawyers and maintain their culture. Those conversations were already taking place when generative AI arrived, so firms were ready to have those conversations.
What we do have to do is take the fear out of it. I remember when associates would spend 12 hours a day stamping documents. No-one would argue that is a good use of their time. Then in the early days of technology assisted review it was extremely controversial, but I don’t think anyone now could imagine doing an investigation without it. We have not only survived, but it works well. My old firm had the first business telephone in the City of Chicago and it was controversial. It changed how we communicated with clients, but we survived that. We need to be less fearful. Granted this technology is disruptive but the organisations that get it right are going to make serious money.
Will the advances in AI mean that clients take on much more work?
Corporate counsel have been doing more work internally for a long time, it didn’t start with AI. During the pandemic, the profile of the general counsel was raised. Business and legal problems that no-one had dealt with emerged so quickly and the GC became very much a part of the C-Suite.
What generative AI does change is the mix of work and what to charge. If a client can use ChatGPT to generate routine emails on real estate deals, good! Everyone wins and it will be done faster and the law firm probably didn’t want that work anyway. But there is probably new work that comes out of that that you can charge for and probably charge more for. Law firms are very resourceful at working out how to stay profitable and I think they will figure it out but will have to surrender
certain work.
How are IT teams being impacted by the latest developments? Part of the challenge for IT teams is that talent wars are real and hybrid work has made it real. People are no longer tied to a geography, so a firm in Minneapolis might be competing with firms in New York, DC and London.
There is a high demand for people with specialities, I think we will see that with prompt engineering and we see it with data scientists and security specialists. People are making good salaries, but law firms are still having trouble keeping them. There are also roles for which you need to be there in person such as the installing PCs or running the AV and it creates almost the ‘have and have nots’ in IT: it’s an organisational challenge in IT to make sure that everyone feels valued.
The relationship between IT and innovation is key: when it works, the benefits to the organisation are extraordinary but it takes effort, and the organisational structure can make it adversarial. The innovation team is supposed to be agile and fail fast, but when something goes into production, there’s a whole series of disciplines it has to go through, including security and information governance audits, which immediately slows things down. The innovation team gets yelled at, but the IT team are just trying to keep up with their day job and deal with a pipeline of new applications, which creates a bottleneck.
What are the key challenges for law firms moving forward?
What is going to be hard for law firms is getting the balance right. I know of one client that is sending out detailed requests asking what law firms are doing with generative AI and others that are saying don’t under any circumstances use it. Some are saying we expect you to use it and reduce our fee. It is hard for organisations to make an announcement when half of their clients will be upset. We need to find a middle ground.
The other issues that organisations have wrestled with is what does my data really mean? They have contracts with big corporations such as LexisNexis and Thomson Reuters and Bloomberg and want to feed that data into competitive intelligence, but you can’t do that because it’s against the terms of use. Those terms were drafted before anyone had heard of generative AI and the big question now is what is my data and what is yours? People need to figure it out or it will result in litigation.
What are your calls to action to the industry?
One call to action would be for people who have been involved in the evolution of technology such as TAR in the eDiscovery space to help us learn from that and understand how to apply that learning to this new generation of technology.