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Stories of how AI will change the legal ecosystem forever are endless, yet ‘rubber meets the road’ proof that this is actually happening are few and far between. Here’s what one firm learned about knowing what AI can do and what they didn’t know it could do.
Like many law firms, Babst Calland is acutely focused on providing the best client service. However, pick up any corporate counsel survey and you quickly realize that the lack of quality legal service delivery by outside counsel is the number one point of dissatisfaction by GCs. While there’s disagreement between firms and clients about the degree of top-notch service delivery, there’s absolute agreement in identifying technology as the greatest service and innovation accelerator.
Enter artificial intelligence and machine learning, the proverbial silver bullets for every law firm looking to ‘do more with less’ and satisfy every client need. Stories of how AI will change the legal ecosystem forever are endless, yet ‘rubber meets the road’ proof that this is actually happening are few and far between. In fact, according to a Bloomberg Law survey on the state of legal operations and legal technology released during the recent Corporate Legal Operations Consortium (CLOC) Institute annual meeting, less than 25 percent of survey respondents indicated that they are using legal technology with artificial intelligence or machine learning. And of those deploying AI, I guarantee not all are game changing.
Our firm, along with our affiliate technology division Solvaire Technologies, are not only AI believers but after exhaustive AI tool evaluations, trials, and numerous AI projects under our belt, we have become our clients’ go-to resource in how we can leverage AI for their benefit. Our firm, with the guidance of Solvaire, has developed its own sophisticated internal systems and processes to better serve clients, and now with AI tools like Diligen, it can more rapidly and accurately identify and extract key clauses in hundreds of thousands of contracts.
We spent the first 36 months of our AI journey reviewing nine different due diligence and contract assistant AI tools, and, within the last 12-18 months, have incorporated specific AI tools as part of the firm’s due diligence, content management, discovery process. With that being said, we are all the wiser when it comes to knowing what AI can do and what we didn’t know it could do. Here are some learnings:
“Taking Out the Trash” with AI: New tools are helping us group document types and get a better overall sense of the type of content our clients have and what they need to focus on. For example, when we have a due diligence project, our ability to get back to our client within the first 48-72 hours with a better sense of the scope of documents and relevant document categories is critical. Clients can then go back to their departments and practice groups internally and better assess and deploy resources as needed since they have a better understanding of the ‘where’ and ‘what.’
Key AI ingredients … Relevancy and Accuracy: We used to spend a lot of time finding the stuff we needed to review, which meant we reviewed unimportant documents and content to get to the relevant information. The ability with AI contract assistant tools to better catalog disparate document sets and then, through complex clause extraction, go directly to the needle in the haystack versus going through every piece of straw to find the needle has been game changing for service delivery.
Training Makes Perfect: Some tools are better than others at allowing you to train it to identify new types of clauses quickly. Some tools are more rigid and require the vendor to be involved in the training. Due diligence projects are always time sensitive so there’s rarely enough time to wait for this external training. It’s important to understand what your requirements are in a specific time frame. Preferably, find an AI tool which is trained to find the most important clauses for your client’s needs out-of-the-box, and which can be quickly trained to find new concepts on the fly.
AI Lets You ‘Think Big’: Since deploying AI tools to help address our clients’ due diligence and review needs, we have been able to do more, quicker, more accurately and on time while offering flat fee predictable pricing. We can now take on bigger projects—and deliver them faster—thanks to our streamlined, best practices process.
Sweat the Small Stuff: For us, the biggest challenge when working with AI tools is that they are typically not being designed by lawyers and legal professionals who deeply understand the due diligence or discovery process. Vendors will offer up provisions that we rarely use or are not critical to the due diligence process, which tells us they don’t understand our business. When finding the perfect AI tool for your specific process and client need, it is critical that everybody speaks the same language. Streamlined functions and simple user interfaces in our AI tools are preferred.
Less + Less = More: A big challenge Babst Calland and many firms face with AI is most providers’ lack of big picture understanding related to more efficient legal service delivery. This often starts and ends with pricing; efficiency gains on the client end do not necessarily translate into extraordinary profit gains on the firm and vendor end. The gains are realized on the process improvement and service delivery end (something that quite frankly, most law firms don’t desire or seek). Law firms need to be able to drive client value based on a valuation process that works for everybody—the client, the law firm and the AI vendor. Law firms that fail at striking that delicate balance will fail in the age of AI.
Invisible AI: Well over a year into leveraging AI to deliver better and faster for our clients, we never hear “wow, we are so excited that you used AI.” Instead, we hear “I can’t believe how fast and accurate that was!” or “we would have never been able to do that.” We do not tout AI as the silver bullet but have silently and effectively worked it into our best practice delivery service model.
Christian Farmakis is a shareholder, management committee member and chairman of the board of directors at Babst Calland, and president of Solvaire Technologies. Having a reputation for delivering reliable, practical, and efficient business-oriented advice to his clients, he is always seeking better ways to serve them. Leveraging technology and developing measurable processes and quality standards to undertake large diligence and document management projects on time and on budget are just two of the ways that make him and his team a legal provider of choice.
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Reprinted with permission from the July 11, 2019 edition of Legaltech News © 2019 ALM Media Properties, LLC. All rights reserved.