LegalBusinessWorld Posts

Filling the Holes of the Legal 
Profession

November 19, 2018

 

A leading company in manufacturing power tools tends to gather up its new executives for a training whereby it shows them a slide of a power drill and simply ask them if this is what the company sells. The new executives usually get baffled and confounded by the question but they usually to tend to answer in the affirmative. To their bemusement, the answer usually comes in the next slide as a neatly drilled hole; the trainers answer that this ‘is actually what our customers want, and it is your job as new executives to find ever more creative, imaginative, and competitive ways of giving our customers what they want.’ [1] 
 

This anecdote can teach us as lawyers a lot of valuable and intriguing lessons; as a starting point, lawyers should start by defining their mission. At first glance, this could seem like an easy question with a simply answer, namely, providing high quality legal services to your clients. On another look, it will be clear that providing high quality legal services is the power drill that might or might not fill the hole. Therefore, the answer should be providing ‘ever more creative, imaginative, and competitive ways of giving our customers what they want’  [2] or what could be simply described as “maximizing the value for our clients.”  The question then becomes clearer; what is the value clients are seeking when they instruct their lawyers. This is actually the hard question to answer which will distinguish one firm from another.

 

In a highly integrated and globalized world, corporate clients are more and more demanding. Corporate clients might find it difficult to compare between law firms to determine which firm would best suit its mission and fulfil its needs. As a starting point, the fees are more or less the same across all the big law firms; they all adopt the same timesheet billing approach, despite the fact that this approach is not necessarily appealable to corporate clients. Clients need to know their transaction costs beforehand in order to assess their risks comprehensively. Therefore, it’s about time for law firms to abandon timesheets and adopt an upfront fixed-fee billing approach. This fixed-fee approach would help the law firms maximize the value to its clients because it will help the firms focus on what is valuable to its clients rather than what is billable.

 

Another area that needs development on part of the law firms, is the ability to speak the language of their clients. What corporate clients understand best is numbers and not legalese. A law firm should try its best to be able to visualize in numbers – as best as it can – all of its legal advice, legal strategies, and legal services. If a law firm is able to assess the risks of a certain issue in numbers, then the firm would be able to communicate better with its client. For instance, a merger and acquisition that is blocked by a required antitrust approval, if the law firm is able to put a percentage on how successful its efforts could be, then this will provide enormous benefit to its client which would be able then to assess whether it’s better to proceed with the acquisition or terminate the agreement. Legal tech could be a useful asset to help with predicting such outcomes. For example, a London law firm used data on the outcomes of 600 cases over 12 months and was able to create a model to assess the viability of personal injury cases. [3] 

 

More importantly, law firms should start utilizing the legal tech in a way that would maximize the value of their clients. In this regard, Deloitte has highlighted the areas of practice that would be best suited as use cases for legal technology. [4] 

 

In this regard, JPMorgan has used an AI-powered program called COIN since June 2017 to interpret commercial loan agreements. This program was able to complete what took 360,000 lawyer-hours in a few seconds.  [5] Further, Kira Systems allow lawyers to identify, extract, and analyze business information contained in large volumes of contract data which could help a lot with M&A due diligence.  [6] Lastly, ROSS uses the power of IBM's Watson supercomputer to find similar cases; it can for instance find a nearly identical case in bankruptcy law to your fact pattern almost instantly. [7] 

 

In conclusion, law firms should always keep in mind that their mission should be aligned with the mission of their corporate clients. The law firm of the future will be able to leverage the efficiency generated by its legal tech to deliver a competitive fixed-fee legal advice visualized in numbers that would maximize the value to their clients by providing ‘ever more creative, imaginative, and competitive ways of giving our customers what they want.’ 

 

 

Notes 

[1] Susskind, Richard, “Tomorrow's Lawyers: An Introduction to Your Future” (2017), p. 188-9. Oxford University Press. 

[2] Ibid. 

[3] Lauri Donahue, “A Primer on Using Artificial Intelligence in the Legal Profession,” Harvard Journal of Law and Technology, January 3, 2018 (last accessed at May 26, 2018).

[4] Deloitte, “A changing world requires a new approach to law,” Available at https://www2.deloitte.com/global/en/pages/legal/articles/legal-management-consulting-approach.html (last accessed at May 26, 2018).

5] Lauri Donahue, “A Primer on Using Artificial Intelligence in the Legal Profession,” Harvard Journal of Law and Technology, January 3, 2018 (last accessed at May 26, 2018).

[6] Ibid.

[7] Ibid.

 About the Author: 

Ibrahim Shehata is an International Arbitration Lawyer at Shehata & Partners Law Firm in Cairo who has recently graduated with an LL. M Degree at NYU School of Law. Shehata also teaches International Arbitration & Civil Procedures as a Junior Faculty Member at Cairo University in Egypt. Shehata's expertise extends to International Commercial Arbitration, Mergers & Acquisitions, Corporate Law, Energy Law, and Project Finance. Shehata is deeply passionate about revolutionizing the business of law firms in particular, and the legal industry in general. Shehata tries to guide legal professionals on how to capitalize on the latest technological advances in the fields of Artificial Intelligence and the Blockchain Technology.

 

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