Why it’s time for law firms to start investing in generative AI

Demand for AI has arrived in the legal industry. Law firms must embrace the change or risk falling behind 

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As a profession rooted in tradition, the legal industry does not necessarily have a reputation for embracing change. Yet, there is a growing appetite for trustworthy and reliable artificial intelligence (AI) amongst lawyers. 

In fact, Goldman Sachs has predicted that the legal industry is likely to be the second most impacted by AI, with 46% of tasks able to be automated by this technology. With this in mind, law firms should start thinking about how AI may intersect with the legal professions’ demands.

“Firms are going to have to get comfortable with a different set of skills. The skill is no longer merely drafting a brilliant contract, it is ensuring the contract that has been created correctly meets all the client needs,” says Stuart Greenhill, director of segment management at LexisNexis. 

According to a survey by LexisNexis in January 2024, more than one-quarter of lawyers in the UK already use generative AI at least once a month. Back in July 2023, this number sat at 11%, showing a considerable mindset shift for an industry known for being risk-averse. 

So, while AI is already driving change in the legal industry, there are still significant concerns. The biggest challenge to adoption is the risk of hallucination, where the AI model ‘hallucinates’ something that isn’t real. 

For example, there have been reported instances where experienced lawyers have experimented with publicly available AI models, resulting in the citation of non-existent cases. 

Another notable challenge is security. Given that law firms hold privileged information about their clients, there is a risk of it leaking into the public domain if lawyers are using AI that is insecure. 

To help mitigate these issues, lawyers need to ensure they are using legally grounded generative AI systems that have been trained on legal data and do not retain confidential information. LexisNexis, for example, has created Lexis+ AI, a legal-specific AI engine. The AI model is built to access all of LexisNexis’ legal research and practical guidance content, so when lawyers are seeking information, they can be assured it is generated from an authoritative source. 

“Anything that our AI engine generates is cited and comes with a clickable link directly to the underlying source, so lawyers can check and be confident that what it says is accurate,” says Greenhill.

The opportunities for law firms to gain a competitive advantage over their peers by moving faster on AI are significant

This can significantly shorten the time spent on legal research tasks, for instance, quickly helping a junior associate understand what case law applies to a particular situation.

“Unless the case has been summarised for you, you will have to read it and that could take 20 minutes, it could take three hours, it could take a day or longer, depending on how big the case is,” says Greenhill. “Now you can just click a button and AI summarises the case.”

By freeing up time for junior associates, they can be assigned higher value work such as contract drafting or even business development and bringing in new clients, Greenhill adds. This speeds up training and gives law firms access to more advanced lawyers faster, elevating the internal talent pool. 

So, the opportunities for law firms to gain a competitive advantage over their peers by moving faster on AI are significant.

“Firms that embrace generative AI can leapfrog their competitors because they are going to be more competitive, they’re going to be able to invest more time in building relationships with their clients and therefore be able to spend more time on the higher value work,” says Greenhill. 

This is a pivotal moment for law firms and those that don’t embrace technology run the risk of getting left behind.

“Client expectations are climbing – with a growing demand for work to be delivered faster and with a higher level of service.  Firms need to continually innovate or else be overtaken by their competition,” Greenhill says.

By investing in the right tools, law firms can get ahead of this trend and ensure they are on the leading edge of the legal AI opportunity. 

For more information please visit lexisnexis.co.uk