The use of technology by in-house teams is evolving – particularly compared to what existed a few years ago, two years ago, or even one year ago. Yet still, for legal departments, change is much less quick than in law firms.
Big legal departments are investigating the possibilities and opportunities offered by new technology. There was a survey done in 2017 targeting French in-house counsel, which showed that many needed more software and applications for legal tasks. But at the same time it was more commonly expressed – by more than 50% – that this was not a need at present.
I wouldn’t say there is a kind of collective trend: I think it really depends on the culture of every individual, every lawyer, the culture of the legal department, and the culture of the company itself. But if I look at a period of five years, there is an increasing trend towards a willingness to understand what is happening, what works and what does not work in terms of technology, what the best practices to benchmark for in-house lawyers are – and also to think in terms of investment and return on investment.
I remember speaking to the GC of a very big French company. He said, ‘You know, I’m convinced that some of this technology is going to be very useful for the legal department – but there is a cost, and I need to convince the executive committee, or even the board, that the cost is justified: that we expect a return on investment, so it means cost reduction for the legal department, how we are going to be able to increase the performance of the legal department in terms of service delivery, satisfaction of the clients and also improvement of our own KPIs.’
(Virtual) reality check
Areas in which some in-house teams in France are using technology include legal research and information, case matter management, contracts management and contracts automation, legal knowledge management, and project management. And, of course, e-billing, selection of legal service providers, benchmarking, sharing of the best practices within the legal team – and this is especially the case in big legal departments. Some of them are using predictive justice tools – although it’s very few, it’s just the beginning – and I would say it’s more used by law firms than legal departments.
As far as machine learning and real artificial intelligence go, I think we are still a little bit far away from that. For blockchain, especially for smart contracts, there is a start: for instance, for intellectual property rights management. Some are thinking about the possibility of using blockchain technology to manage the participation of shareholders during general assembly. There is also the smart contract approach of using blockchain technology for contracts between shareholders, for instance to organise the control of the company, or to have agreement provision in the case of share selling. As far as I know, legal departments do not directly use big data analytics, but they can work with some law firms that do.
I think that the particular areas right now where the technology is the most useful are document review, case review administration and case analytics, legal research, document drafting, knowledge sharing and communication. But when you think in terms of legal writing and advising clients, I think that – right now – the effect or impact of the new technology and data analytics and so on is very low.
When you look at the current legal technology and new legal technology and what they propose in terms of services, it’s moving really fast. But the next steps – more deep learning, machine learning and real artificial intelligence – frankly speaking, will not come within ten years. The creator of DeepMind, which was acquired by Google, said something which was really interesting: when you hear people saying that tomorrow everyone will be replaced by robots, and we will be able to have a full, sophisticated conversation with an artificial agent, he said no: that’s not serious. What is serious is the ability to replace standard analysis and decisions with robots. Analysis further than that, when there is more room for subjectivity and when the exchange between different persons is key in the situation, the Turin stage of artificial intelligence, machine learning, deep learning, deep thinking and so on is not at the right level. We are not there yet.
Redefining value add
One important point when considering the value of technology – something which is happening in some law firms already – is change in the value chain of the legal department.
Typically, you have information entered into the ‘system’ of the in-house team and, at the end, you need to provide a service – advice or a solution. All the segments of the chain, like information gathering, information analysis and treatment, document drafting, due diligence, are going to be more and more digitalised, and done increasingly less by human beings. This means that the skills required for lawyers are going to change, and the quality of the relationship between the client and the legal adviser is going to become more important. Right now, I don’t see any robots directly advising clients because they are not sufficiently sophisticated. But for the lawyer to give good advice, fully understanding the needs of the client and having sufficient time to discuss their analysis with the client – what are the facts, what is the law, what is the content of the regulation, what is the state of the jurisprudence or case law – all of this is going to be done faster, which will leave more time to deliver very high quality advice and service.
The freed-up time can then be used on other important areas. Lobbying is one of them because, surprisingly, in France, the lobbying role of lawyers is not always taken into account by legal departments. Giving the possibility to legal teams to think more about the future of the law in their domain regarding their businesses or the businesses of the company is very important, but you need time to do that. It’s not directly productive, but it can have a huge impact over time. It will also allow departments to take time to train non-lawyers and to increase the global level of the legal education in the company – to reduce the common questions. The other side of that is that there’s also the potential to increasingly automate processes – improving efficiency and quality of services across the board.
Training lawyers of the future
What we need to be doing in the here and now is, when we train future junior lawyers, they need to know how to use data analytics, how to use the new tools which are available on the market, and maybe we also need to train them to understand how algorithms work, even if we are not going to create hordes of lawyers who can code. To understand what it means when you code, and what are the consequences in terms of legal mechanisms, legal analysis, or legal documents, to have fundamental tools to understand what coding means, is going to be very important for them.
The second important point, I think, is to reinforce their soft skills, because the relationship with the core business will be more and more about the quality of the relationship. For instance, what about empathy? Being able to take time to listen to the client, to take their point into account. Knowing that the time you spend for legal research, information retrieving and analysis is going to be reduced and reduced and reduced, if you want to maintain the same revenue for a law firm or the same level of service for a legal department, you need to perform better elsewhere.
As educators, we need to be doing these things. If we do not, we hear from young students who are going to intern for six months or a year, coming back from legal departments or law firms saying, ‘Well you know, we had to work with this tool or that tool, or there was discussion about using a new tool to improve the relationship with the external suppliers, e-billing, and so on, and we didn’t have any clue about what they were talking about.’ Even if you are not convinced, you need to better train your students on these kinds of tasks because they ask for it. There is a demand for it.
Practitioners know better than academics what are the most up-to-date tools they are using in the industry. But I think it’s the role of academics to prepare students to be able to be flexible, reactive and to be able to switch from one tool to another one and to have a global vision, a global understanding of what is happening. And to make them aware that there is a certain level of uncertainty in practice. Usually, when you study law, you do not like that: you like certainty, and the more it is fuzzy or blurry, the less you feel comfortable. We need to prepare them for that.
Now, the question is: is technology going to kill some jobs? I would say, yes of course. Will it promote the creation of new jobs? I think so. Will it change the type of skills required for lawyers? I think it will. I think that the development of these new tools is more an opportunity than a threat if they provoke a change in the business models and the way lawyers deliver their services in the interests of the client. But if some so-called artificial intelligence can lead to weak services and fragile legal advice, then they will be stopped or simply not used. So I think the market will decide and will make a distinction between good stuff and bad stuff.
It seems strange, because sometimes lawyers are perceived as being very conservative, but I can tell you that in France, the legal domain is just after finance in terms of being active in start-ups. I mean, legal tech versus fintech versus other kinds of activity – legal tech is very, very active. Recently, I was surprised to find that that the legal tech that we observed two or three years ago is still alive. Maybe, at the end of the day, you have a Darwinian system where the most adapted survive. You cannot have, for instance, tonnes of companies in France proposing predictive justice because the market is not so big. But I would say that the legal domain is very well placed in France, and could rank well in terms of intensity and innovation; it’s very active. Which is surprising, because lawyers are perceived as being the most conservative compared to some other professionals.
An important objective or challenge is to make in-house counsel more comfortable with the technology, doing demos, sharing success stories, sharing best practices and, to a certain extent, kill the myth that technology is too complicated: that it’s not for you guys because you are lawyers.