Technology

Faster Horses

AI is so new and so foreign to most legal professionals that they may think of their current mode of working when expressing their needs.

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“If I had asked people what they wanted, they would have said faster horses.” This is just one version of a popular quote often attributed to Henry Ford. Whether Ford actually said it or not, the point is that customers don’t always know what they want. Now bear with me for a moment: it’s not that customers can’t express their needs or that they can’t communicate solutions. The problem is that customers aren’t always aware of new technologies or solutions that can lead to new products and new markets.

In “The Innovator’s Dilemma” the late Harvard professor and author Clayton Christensen said it another way: you can’t do market research on a market that doesn’t exist yet. Asking people who have only ridden a horse what they think they want in an automobile, when they’ve never driven an automobile, would lead to some well-intentioned responses — but those responses would be lacking.

The problem is worse if the business analysts, product owners, and leadership responsible for developing that automobile have never driven one either. It’s human nature to gravitate toward what is familiar, but familiar concepts can only take us so far when we’re exploring the possibilities of a new technology.

Imagine someone conducting research on the automobile asking question like these:

  • When you want your horse to go really fast, how would you want to do that? By swinging the reigns harder? Or do you think you’d use a bigger whip?
  • Do you ever attach a carriage to your horse?
  • With a faster horse, how often would you expect to replace the horseshoes?

These questions sound a bit absurd, but they highlight a very real problem for legal professionals looking to innovate in a world with new technologies like Generative AI. AI is so new and so foreign to most legal professionals that they may think of their current mode of working when expressing their needs. And many people who find themselves responsible for innovation in a law firm may have limited experience with AI. There may be a tendency to ask attorneys questions that are equivalent to those above about faster horses.

Ford was an interesting and complex person with great vision. He developed an assembly line for the Model T. Once the design for the Model T was good enough, he stopped making changes and focused on continuously driving cost out to make the car more affordable. He paid his employees enough and gave them time off so they could actually afford to purchase a Model T.

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What guided Henry Ford’s vision was a recognition that he was solving a transportation problem, not a horse problem.

For the legal innovator, it is important to step back or “helicopter up” to think about a higher level problem.

  • Rather than improve the efficiency of document review, perhaps the problem to be solved is to eliminate the manual aspects of document review?
  • Instead of improving legal research, perhaps it is more important to understand why the research is being conducted in the first place and solve that problem. Maybe the real problem is developing a legal argument or determining if a motion or pleading will be successful.
  • Is there data available now that would make it possible to advise a client to settle a case rather than litigate?
  • Can corporations automate compliance tasks that would give the general counsel and chief compliance officer confidence that they are complying with law?
  • Are there ways to avoid litigation or mitigate risk in the first place?

Generative AI is likely going to change the way the law is practiced. Incremental change will occur, including productivity enhancements. But in the same way that automobiles changed transportation, AI, machine learning, and data analytics are likely going to change the practice of law. Before the automobile, traffic lights weren’t needed. And the infrastructure of service stations, oil companies, and car dealerships didn’t exist.

Just as Ford stepped back to understand he was solving for transportation, leadership in the legal profession will want to step back. What is the role of the law department in a corporation? To advise on individual matters that arise? Or support growth and shareholder value while ensuring compliance with the law?  For a firm, is it to manage client relationships and bill time? What if the billable hour goes away?

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I’m oversimplifying here, as many sophisticated law departments and firms have clear mission statements. But the point is, AI may cause the industry to step back and rethink.

The practice of law has historically been a labor-intensive field. Legal professionals use technology today for productivity, but the focus is primarily on human capital, including hiring, training, and retaining staff. If AI drives automation so that more of the work and value is done by machines and robots, it is likely to affect the capital structure of a firm. There may be a shift to provide more balance between human capital and capital invested on technology. The billable hour is great in a human intensive business model, but it falters when large investments pay out a return over a period of years. And across clients and matters.

Will firms be able to charge by the hour for AI computing time? Probably not. Embracing technology is only going to make firms better. Firms will be able to provide more value with AI-enabled services. The question is how to convey that value to clients and how to charge for it.

So regardless of role — innovators, legal ops, attorneys, paralegals, managing partners, and general counsel — all will eventually be confronted with areas of unfamiliarity.

When this happens, try to think like Henry Ford did when he was trying to build an automobile. What are the larger problems that Generative AI can solve for? If you can focus on what those problems are, you’re more likely to understand the potential impacts that this technology can have on the legal industry — and from there determine how to harness its power to your advantage.

Ken Crutchfield HeadshotKen Crutchfield is Vice President and General Manager of Legal Markets at Wolters Kluwer Legal & Regulatory U.S., a leading provider of information, business intelligence, regulatory and legal workflow solutions. Ken has more than three decades of experience as a leader in information and software solutions across industries. He can be reached at ken.crutchfield@wolterskluwer.com.

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