The Automation Gap: New research shows disconnect between law firm attitudes and investment

Intapp will today (25 September) unveil research that shows while UK law firms consider intelligent automation to be an important factor in driving growth and efficiency, there is a significant gap between this recognition and the actual investment in deploying these technologies.
While 86% of UK firms believe automation is an important factor in managing client terms, just 17% have actually adopted the technology to implement this. Which really puts discussions over the use of blockchain in perspective.
The research, conducted in collaboration with The Lawyer, surveyed 111 law firms in the UK and sought to identify where firms are positioned on the “data-driven insights and intelligent automation adoption curve”.
Overall, less than half of law firms in the UK are utilising intelligent automation in some way. The top areas that AI is currently being implemented include, conflict clearance (43%), legal project management (43%) and pricing (37%).
Perceived Importance of Intelligent Automation vs. Actual Investment
– 94% deem intelligent automation to be important for conflicts, yet only 43% of firms are taking advantage of data-driven insight in this area.
– While 86% of firms believe that using data-driven insight to manage client terms is important, only 17% currently use technology solutions for this purpose.
– 91% firms feel intelligent automation is important for resource allocation, yet only 20% have invested in this area.
– Although 85% of law firms agree that automation is important to deliver insight and analytics to clients, only 20% have, to date, made the investments necessary to embed this capability into their service delivery models.
– 46% of respondents stated that intelligent automation for opportunity identification and cross-selling is very important, yet only 13% of law firms report they are currently utilising data-driven insight for this purpose.
“As law firm clients become more informed about process, value and alternative services, long-term relationships are being challenged,” said John Hall, CEO of Intapp. “What we’ve seen in the industry – and what this study shows – is that forward-thinking law firms are embracing a client-centric technology strategy as a driver of both top- and bottom-line growth. They are using intelligent automation, AI and other modern technologies to differentiate themselves from the majority of firms who are lagging behind.”
Top Three Investment Areas for Future AI Capabilities
Surveyed firms selected the following use cases as the top three investment areas for future artificial intelligence capabilities: 1) seeking improvements in time recording to support accurate and prompt billing; 2) pricing to improve budgeting accuracy; and 3) identifying target opportunities through relationship mapping.
“A key challenge our firm will face over the next twelve months is the changing nature of the legal business model,” commented Mark Ford, chief knowledge officer at Baker McKenzie. “The new model will be more efficient (by client demand), and this will be achieved in part by using technology, with a growing emphasis on the value that AI solutions will begin to bring.”
Firm Performance Is Positively Impacted by Investments in Technology
The industry “pacesetters” (those earning £700 million – £1 billion in revenue) are making the most significant technology investments to date across the entire client lifecycle, with 81% planning to invest slightly or significantly in client development and 74% planning to invest in business acceptance. The survey also showed that the highest-performing firms have also made the most significant investments in automation in the areas of business acceptance and client delivery.
“People are now thinking of investing in technology because of the strategic advantage it can give them,” commented Abby Ewen, IT director, BLM. “Previously, these investments were seen as a necessary ‘keep the lights on’ evil.”
According to PwC’s 2017 report, 80% of Top 10 UK firms and 57% of Top 11-25 firms have already established or begun piloting artificial intelligence solutions. These firms are already benefiting from intelligent automation, through time saved and overall performance of the firm. The introduction of artificial intelligence capabilities into firms opens new possibilities above and beyond the ways in which law firms are currently automating workflows.
“Clients may not be asking directly for modern technology as part of their legal services, but its absence could erode demand,” said Ralph Baxter (pictured), industry thought leader and Board of Directors member at Intapp. “Forward-thinking firms recognise that process design, innovative technology and experimentation can help them better differentiate themselves, win more business, produce material improvements in their service delivery model and increase quality – all while reducing their costs.”
Full survey results and related content are available here: