Remember when legal work meant endless paperwork and manual processes? Those days are fading fast, thanks to AI.
But what does this mean for legal operations?
In this article, we'll explore just that:
- AI's role in simplifying legal workflows
- Its potential to enhance strategic decision-making
- The impact on managing compliance and risk
The legal industry is notorious for its resistance to change, but AI is breaking down barriers. Join us as we uncover how AI is reshaping the landscape of legal operations, turning challenges into opportunities for innovation and growth.
Also read: What Is Legal Operations?
A golden opportunity for legal operations
Despite their critical role, legal ops professionals often fly under the radar.
According to a study by Lexis Nexis, 63% of legal teams admitted they’d never paid attention to legal operations, and in the words of Shelley McKinley, GitHub's Chief Legal Officer, "in-house teams haven't always understood how much they needed legal operations."
But the rise of AI has brought massive awareness to legal tech and legal ops. In an era where legal departments are required to achieve more with less, in-house counsel across organizations have been curious about generative AI and how they can utilize it to improve their strategic contributions.
This has presented a golden opportunity for legal operations professionals, who are not only well-versed in generative AI but are also armed with insights on how it can provide legal departments the competitive advantage they need to thrive.
"AI can be the transformational force for legal operations, bringing to the table its capacity to streamline workflows, cut down costs, and propel business growth."
~ Tom Stephenson, V.P of Community and Legal Operations, Legal.io
By helping legal departments identify AI use cases relevant to their objectives and championing its procurement and implementation procedures, legal ops professionals will successfully prove their worth and finally get the recognition they deserve.
“One big hurdle for creating a legal operations role within a legal department is the naturally conservative nature of lawyers. Most in-house lawyers prefer the status quo and jumping on “crazy new things” is just not the way of most of them behave, especially in an environment where mistakes can reflect poorly on them and the legal team regardless of the often mouthed assurances from senior management that failure is welcomed within the company as a learning experience.”
~ Sterling Miller, CEO and Senior Counsel for Hilgers Graben PLLC
Ten Things: Legal Operations – What In-House Lawyers Need To Know
AI use cases in legal operations
Here, we will discuss the various ways legal ops professionals can utilize AI to streamline the delivery of legal services and provide in-house counsel with bandwidth for more strategic contributions.
#1 Contract review
Traditional (read manual) contract review is often a time-consuming process, requiring laser-focused attention and a thorough understanding of how each clause can impact the organization on business, ethical, and legal grounds.
When done at scale, this process can exhaust the in-house counsel, become prone to errors, and delay the conclusion of agreements.
“If you try to read a complex contract carefully, from front to back, and expect to understand it on just the first read-through, that’s wishful thinking (and potentially very messy).”
~ Sterling Miller, CEO and Senior Counsel, Hilgers Graben PLLC
Ten Things: How to Read a Contract
However, by implementing AI, legal professionals can enjoy rapid and accurate review of business contracts with minimal manual intervention. This allows them to safely review multiple contracts in record time while channeling the bulk of their energy towards more strategic aspects of legal work.
VerifAI is a solid example of an AI contract review tool tailored to suit the needs of legal professionals. Powered by a rich database of up-to-date data and advanced Natural Language Processing (NLP) algorithms, VerifAI instantly scans your contracts against established guidelines, flagging risk areas and suggesting the right redlines.
Additionally, VerifAI allows you to ask open-ended questions related to your contracts, providing detailed answers and references to support your decision-making process. Still, this is just the tip of the iceberg.
If you’d like to experience the full extent of VerifAI’s capabilities, click here to try it for free between now and November 30th!
Also read: How AI Contract Review Tools are Transforming Legal Workflows
#2 Document generation
Legal ops teams can employ AI to automate the generation of various legal documents, such as contracts, letters, and legal correspondence.
AI document generators are typically fuelled by robust databases of historical documents along with advanced NLP algorithms. This gives these tools an in-depth understanding of specific requirements and nuances related to different document types.
All the users need to do is input the right prompts, and the tool will automatically generate the required document.
Using AI minimizes the risk of human error in drafting, as these systems are trained on extensive datasets to recognize patterns, language intricacies, and legal terminology.
Additionally, AI tools are significantly faster than humans. Thus, utilizing them can reduce the time spent on routine processes, allowing legal teams to focus on higher-value tasks.
SpotDraft AI, for instance, automatically generates contracts for any business deal, allowing minimal manual inputs from its users.
All you need to do is upload the documents related to the business agreement, and the tool will automatically generate a contract template with the right information and legal guardrails.
Alongside contract generation, SpotDraft AI also automates due diligence and contract analysis, giving you a well-rounded contracting experience.
Also read: The Future of Legal Documents: What’s an AI Contract Generator?
#3 Legal analytics and reporting
AI is capable of helping legal ops teams generate insights into various areas of legal activities, like budgeting, performance levels, trends in regulatory compliance, and negotiation patterns.
By taking advantage of data-driven insights, legal ops professionals will better understand how various conditions impact the legal department’s performance, provide more accurate budgeting for legal projects, and make more informed decisions.
“Most C-Suite executives bank on data and hard metrics and not word-of-mouth. When you have certain metrics that shed light on how legal teams have contributed to growing the revenue stream of the company, it becomes easier for the GC to make business cases.”
~ Gitanjali Pinto Faleiro, General Counsel, Company Secretary & CCO at Greenhill & Co.
Navigating the C-Suite as a GC
Legal ops teams can also use AI’s predictive analytics capabilities to forecast future legal trends, case outcomes, and potential areas of legal risk. Armed with these insights, they can implement proactive strategies to ensure they’re always on top of situations.
Also read: Legal Analytics: Definition, Tools, and Applications
#4 Legal spend management
One of the most important responsibilities of legal ops teams is to help legal departments maximize results with limited financial resources. This is often achieved by implementing technology, standardizing processes, managing vendor relationships, and keeping risks within tolerable boundaries.
By adopting AI in legal spend management, legal ops professionals can efficiently track and analyze legal expenses, access insights into costs, and identify areas for potential savings.
AI can analyze historical financial data, track spending patterns, and provide insights to help legal professionals make informed decisions about resource allocation, cost containment, and budget planning.
“The one metric that I love is legal spend over time versus revenue. The spend may go up, but it won't go up nearly as fast as revenue. Finding a group of companies, getting the data on who works there, how much they spend on external counsel, lawyers per billion, etc., is a difficult task. But once you put that hard work in, you can show your legal leaders what your total legal spend versus revenue over time versus benchmarks was. That's the kind of thing that makes your CFO smile.”
~ David Lancelot, ex-VP Global Head of Legal, eBay Classifieds
Embracing Legal’s Role as Business Co-Leaders
Additionally, AI can automatically review legal bills for compliance with billing guidelines and flag any discrepancies or anomalies. This reduces the risk of overbilling and streamlines the invoice approval process.
Making the most of AI in legal operations
“I really believe that if AI is deployed in the right way, it’s going to allow us to elevate and to focus on the right aspects of the work, the work that offers the most value”
~ Mary O’Carroll, Chief Community Officer at Ironclad
Why advances in AI present a golden opportunity for legal ops
Getting optimal results from implementing AI in legal operations requires adequate preparation and a strategic implementation process that aligns with your organization's goals and unique challenges.
Here, we've covered some tips you should remember in your bid to leverage AI in legal operations.
#1 Have a clear objective
Clearly articulating your organization's objectives for integrating AI into legal operations is foundational to the success of your adoption process.
This involves identifying specific pain points and areas where AI can offer the most value, such as streamlining contract review, optimizing legal research, or enhancing document automation.
This clarity of purpose serves as a roadmap, guiding subsequent decisions in the implementation process.
#2 Understand your data
Keep in mind that an AI tool is only as good as the data that fuels them. If outdated data powers the AI tool, your outputs will likely be below par. And in an industry that requires your fingers on the pulse at all times, having a constantly updated database is paramount for achieving reliable results with AI.
Communicate with your vendors to understand the data they trained their AI on and how often their database is updated. This will help you identify the AI platform that will not only meet your current needs but also evolve with the dynamic requirements of your industry.
#3 Establish criteria for selecting the right AI tool
There's been a massive influx of AI tools in the legal industry. However, these tools have individual strengths and are not fit for everyone. So, how do you narrow down to solutions that are right for your organization?
To do this, you must outline a set of criteria describing your ideal AI platform. Factors like the accuracy of AI models, ease of integration with existing systems, and scalability should rank as top priorities.
This helps you ensure that the implemented AI solutions are practical and sustainable in addressing the unique demands of legal workflows.
Also read: Top 5 Free AI Tools for In-House Legal Teams
#4 Pay attention to ethical and legal compliance
The use of AI comes with several legal and ethical considerations that must not be overlooked.
It is imperative to verify that AI tools comply with applicable laws and regulations, particularly in areas of privacy and confidentiality.
Establishing a foundation of legal and ethical compliance is non-negotiable, given the sensitive nature of legal information.
#5 Invest in training
Empowering legal professionals with the requisite skills to effectively leverage AI tools is crucial. Training initiatives should be comprehensive, addressing not only the technical aspects but also the practical integration of AI into daily workflows.
This investment in training ensures that the legal team is not only proficient in using AI but also embraces it as a valuable asset.
#6 Always test the waters before taking the plunge
Before you fully commit your entire workflow to an AI-led ecosystem, running a comprehensive testing process is important. Gradual integration through pilot projects allows organizations to test the waters before full-scale implementation.
This controlled approach provides valuable insights into the real-world effectiveness of AI tools in legal processes. The feedback from pilot projects will inform necessary adjustments, creating a more refined and tailored implementation strategy.
#7 Collaborate with legal professionals
The main goal of legal ops is to optimize the delivery of legal services. To do this, legal operations professionals must collaborate with in-house counsel, paralegals, and other members of the legal department to understand their pain points and proffer solutions.
This applies to the implementation of AI in legal workflows.
To get it right, you must work together with legal professionals in your organization to understand the various use cases where AI can be beneficial to them.
This not only ensures a successful and tailored implementation but also fosters a sense of ownership and acceptance of AI tools among legal teams.
#8 Monitor, evaluate, adjust
Regular assessments of AI performance allow organizations to gauge how well AI solutions align with the defined objectives and whether they are delivering the expected benefits.
This involves tracking key performance indicators (KPIs) like speed of document review, accuracy in contract analysis, efficiency gains in legal research, and the overall impact of AI in legal workflows.
With these insights, you can then adjust different aspects of your AI implementation strategy to effectively meet your organization’s requirements.
It’s only the tip of the iceberg
The impact of AI in the legal industry has been instant and monumental. But there's still much to look forward to, especially for legal ops professionals.
In the coming years, we can anticipate even more sophisticated AI tools tailored to the specific needs of the legal industry.
As organizations continue to embrace AI and other emerging legal tech innovations, legal ops professionals will find themselves at the forefront, inspiring a legal ecosystem that is dynamic, adaptive, and ready to meet the challenges of the future.
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