How the law can do justice to emerging technologies

The relationship between the legal sector and information technology is poised to change dramatically over the next decade. Indeed, the role of IT is already changing rapidly for some in-house legal departments and law firms.

Constant and accelerating innovation is delivering analytical tools that can, for example, interrogate the characteristics and outcomes of past insurance disputes to predict the likelihood of legal success for current claims.

Clients are also becoming savvier around the cost efficiencies IT can deliver and are auditing law firm IT systems and assessing the IT capabilities and proficiency of the individual lawyers assigned to their account.

Rapid IT advances are enabling the creation of new strategies, business models, collaborative working arrangements, virtual law firms and service delivery models. A look to the future highlights several emerging technologies that could transform every aspect of the legal sector.

Coming over the horizon are developments offering the promise of automated capture of every image we see and conversation we have, intelligent virtual assistants to guide in-house counsel and external lawyers, wearable technologies and widespread adoption of artificial intelligence in the legal value chain.

There is a growing recognition that technology will play an increasingly central role in the emerging legal environment

So what are the critical technologies that will shape the future of the legal sector and how should in-house legal departments and law firms be preparing for them?

To help explore and address these questions, the International Legal Technology Association (ILTA) has launched its Legal Technology Future Horizons research project. This ten-month global study will explore the potential impact of new and emerging technologies for the sector, and the resulting strategic priorities over the next ten to fifteen years.

The study is designed to challenge current thinking, and provide insights and practical ideas to inform the development of future business and IT strategies for law departments, law firms and legal technology vendors.

The final report, to be delivered at the end of 2013, will outline:

  • Key trends in the broader environment affecting the legal sector
  • A likely timeline of IT developments and the key technologies that could impact tomorrow’s legal enterprise
  • The role technology could play in future legal-sector business models in a changing business environment and as a critical differentiator in this emerging landscape
  • Strategic IT imperatives for the legal industry and critical implications for the management of IT in the legal sector.

Our findings to date suggest the next ten to fifteen years will be characterised by continued global economic turbulence and uncertainty, with a significant shift of wealth, influence and power to emerging markets.

Every business sector will continue to be transformed by factors, such as shorter and faster business cycles, talent mismatches, disruptive innovation, and accelerating diffusion of advances in science and technology.

The effective use of technology is seen as critical both in responding to these forces, and in the generation of new commercial opportunities and business models for customers and law firms alike.

These global business drivers are coupled with factors such as growing client demands for transparency, information and innovation. At the same time, there are expectations of greater regulatory scrutiny along with growing concerns over security, data protection and data privacy issues.

Intense price competition, commoditisation, alternative business structures, disruptive new market entrants, demographic shifts and rapidly evolving customer expectations are changing the nature of the relationship between clients and their law firms.

Collectively, these forces are driving the need to rethink the strategies, business models, structures and operations of in-house departments and law firms.

There is a growing recognition that technology will play an increasingly central role in the emerging legal environment, streamlining legal processes, enhancing client-supplier relationships and creating future sources of commercial benefit as both a value-chain enabler and value creator, with a focus on data-driven insight.

Technology is also facilitating the move towards more online delivery of services and enabling new types of structures with different business models for in-house units and providers. Indeed the boundaries between in-house and external service firms may blur dramatically with individual lawyers moving between them fluidly.

Faced with continuing change, key themes are emerging around the role of technology in tomorrow’s legal function and enterprise:

  • The technology environment will be characterised by the “internet of things” [machines “talking” to machines], social media and “social listening”, smart environments, a more immersive multi-sensory intelligent internet, increasingly sophisticated data gathering and analysis, plus widespread penetration and adoption of artificial intelligence (AI).
  • End-users will increasingly be mobile, supported by intelligent digital personal assistants and “lab on a chip” devices, and use wearable technologies enhanced with augmented reality (AR) and holographic displays.
  • Devices will offer AI-enabled smart interfaces, automatic language translation, and support user interaction via gestures, language and thought.
  • Customer service delivery could be enhanced through deep collaboration environments, portals providing tracking dashboards and total transparency on the status of individual matters, shared databases, advanced videoconferencing, touchable holographs, novel data handling tools and sophisticated security technology.
  • Legal function and law firm processes could be transformed through developments in AI, knowledge management, smart data capture and analysis, predictive analytics, intelligent document production, video mining, integrated analytics and “gamification”. Emerging technologies could bring about dramatic changes in the way matters are conducted and information is analysed and presented back to clients.
  • At the IT management level, the cloud will be used for infrastructure, applications, development and data. Priorities for IT management will shift from production to innovation, developing next-level services and evolving the IT staff profile, skill sets, management focus and alignment. For in-house functions, a dedicated IT and knowledge manager will become an increasing priority.

While some in-house functions and law firms are alert to and embracing the transformative potential of IT, others are struggling to stay abreast of the changes and showing reluctance to embrace these opportunities. The challenge is to help players across the sector prepare for and embark on IT enabled transformation.

Business and IT leaders need to understand the emerging technologies, explore how to integrate and manage them, and identify opportunities to leverage IT to deliver new levels of efficiency and competitive advantage.

Rohit Talwar is a global futurist, chief executive of Fast Future Research and research director of the Legal Technology Future Horizons project.