Legalweek New York 2020: The Time Has Come for Lawyers to React Proactively to Data and Technology
To every action there is always opposed an equal reaction.
What does this quotation mean? Essentially, the laws of science dictate that a reaction is always necessary when there is a change of force and forces are constantly changing. Thus, knowing a reaction must occur, it is a best practice to react proactively and this concept was the theme of Legalweek New York 2020 – preparing the legal community to “drive legal forward” by taking the initiative in an ever-changing environment. Lawyers must not only stay up-to-date on the latest legal technology trends, but also be proactive about implementing emerging solutions into their practice and ensuring smooth onboarding and adoption. Also, legal teams need to take control of data management which is growing at increasing rates. IDC estimates that by 2025 worldwide data will grow 61% to 175 zettabytes! Legalweek offered several networking opportunities, speakers, product demonstrations, and small group sessions that seemed to have one message in common – technology and data governance will continue to influence every aspect of the legal profession and lawyers need to use the tools available to react proactively to these changes.
Below is an overview of the major themes that surfaced at the conference regarding how the legal community can be proactive.
1. The Changing Role of General Counsel
Technology is changing general counsel’s role in the legal industry and law firms need to react to remain competitive. The time has come to embrace emerging technologies in order to provide clients with solutions that represent their current and future needs. Diversifying staff and solutions is key to continued success in the industry. Many firms are already using artificial intelligence (AI) to streamline tasks, cuts costs, and gain insights. For years, this only applied to the use of TAR solutions for eDiscovery review. Now, more lawyers are discovering that AI is versatile and can help with things like contract analytics and legal trend analyses. Firms can use their data and AI solutions to monitor and advise of potential upcoming issues using predictive analytics.
Consequences of Not Embracing Legal Tech
The legal technology industry is also creating several new career opportunities. More legal tech jobs are popping up for things like data analysis, product development, and automation. In the future, lawyers will become an integral part of product development and collaborate more with legal tech professionals. The hard truth is that the market will push out firms who fail to embrace a collaborative approach, utilize technology, and develop new partnerships. One thing that was apparent at the conference is that more legal professionals are starting to embrace the dramatic role changes in their practice. General counsel often must do more with less and need technology to drive success. Firms can help general counsel drive efficiencies in business decisions by working together to determine what technology is most beneficial. Firms need to start adopting a teamwork approach not only with general counsel, but also by turning to alternative service providers and the Big Four as collaborative partners. General counsel is also looking for outside counsel to adopt a more client-centric model.
Using Predictive AI to Save Clients Money
There also appears to be a shift in power in the billing arena, where general counsel can now drive legal prices more than lawyers can dictate. As such, law firms need to come up with predictable pricing models for clients and be creative in their billing structures to avoid large cuts to tasks that took valuable time and resources. Lawyers should proactively warn corporate clients about high-cost services or technology that they need for a case or project in order to remove the element of surprise when the bill comes. Using technology and innovation can help counsel be proactive about monitoring and identifying potential issues, which will save money and provide clients with a better outlook on a case.
2. Implementing information governance and data management policies to comply with constantly changing data privacy laws.
Numerous countries have been enacting privacy laws, which are creating an increased concern around data privacy compliance. We learned at the conference that there is an average of 220 regulatory change alerts from over 750 regulatory bodies every day. This number will continue to rise since there are new privacy laws on the horizon. Lawyers need to know applicable laws and advise clients on how to proactively get ahead of the data compliance trend. Failure to comply with laws that provide consumers with more control over data, like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), can result in heavy fines. Since many companies collect and sell data from individuals located all over the world, it is vital to remember that these privacy laws can reach across borders.
Proactively Improve Compliance with Information Governance
The fact that employees, clients, and corporate partners conduct business over numerous devices and networks often makes it difficult to track data. Utilizing a strong information governance plan helps organizations get their data in order, which proactively improves compliance efforts. Information governance plans can include tracking and analyzing regulatory updates, creating and updating policies regarding data usage and retention, learning about emerging technologies to improve collection methods, and potentially hiring new personnel to handle compliance tasks.
Microsoft 365 Cloud Data Privacy Solutions
Embracing new technology and the automation of data can help protect consumer privacy and get ahead of compliance issues. The failure to be proactive about safeguarding sensitive data against breaches increases the risk of compromised data, which results in noncompliance and loss of consumer respect. One helpful tool to protect data is auto-classification software, which classifies data and helps determine what data companies need to preserve. In addition, Microsoft 365 is a cloud solution that offers several features to assist with data privacy like advanced encryption, threat protection security, and data loss prevention options. Hiring an industry expert to act as a partner and help determine what solutions ensure compliance with privacy and regulatory laws can help organizations find compliance tools (such as Microsoft 365) as well as how to integrate these technical solutions into a larger information governance plan.
3. Using AI outside of TAR
AI was, of course, a hot topic, but this year there was more analysis of AI outside of TAR. One way corporate America is looking to utilize AI is for risk assessment. Available AI technologies now allow organizations to dig through their data to uncover issues before they arise. AI technologies can potentially detect workplace issues like negative patterns concerning employee behavior, trade secret theft, sexual harassment, and a plethora of other workplace matters, before they escalate.
The Impact of AI on the Legal Marketplace
The use of AI tools that aid with contract review and negotiation were a component of conversations on AI capabilities. Contracts analytics software operates off of algorithms that users train to quickly identify key data and potential issues. The major draws to contract analytics software are that they keep contracts uniform, save time and money, and help attorneys stay compliant with applicable laws.
Recurring themes about the impact of AI on the legal marketplace was questions on if this technology could replace the need for lawyers. The history of implementing new technologies into the legal practice shows that there is nothing to fear; just like TAR, these solutions cannot operate without the input and direction of a knowledgeable attorney.
4. Blockchain’s Influence on Legal Practice
Finally, the future of blockchain technology in the legal industry was a hot trend. People are realizing that cryptocurrency transactions are not the only application of blockchain technology. While this technology is still in its infancy, it will continue to grow and appears to be a significant part of the future. Legal professionals should be proactive about learning how they can use blockchain for business purposes and any hurdles it may bring to the industry. The first thing to do is learn how this complicated technology works in order to be prepared for the influence it will have both in practice and business operations. Conducting research, attending seminars, and consulting with subject-matter experts about blockchain application and theory are all important steps.
Firms should prepare to see more competitors allowing blockchain as payment for legal services. Failure to provide this option could decrease corporate client retention. Lawyers may also be able to enlist blockchain to monitor and automate data privacy compliance efforts.
The future may also experience an increase for “smart contracts”, which are contracts rooted in blockchain technology, that allow for automated self-executing transactions. However, many lawyers at the conference were skeptical about how prevalent smart contracts will actually become in the near future. Just the nature of this type of contract poses a myriad of potential issues, like software glitches and protocol for handling disputes. For now, it is likely that companies will continue to use a hybrid approach of semi-automated contracts, which still required human intervention for negotiation finalizing terms.
It is clear that Sir Isaac Newton’s theory does not just apply to objects in motion, but also provides a framework for how practitioners need to think about technological advancements in the field. Lawyers need to take advantage of experts in the field and/or self-educate on ways diversity and technology can help them stay ahead of the curve. Legalweek showed us how the legal landscape is changing, but also provided a roadmap for how to “proactively react”.
If you’d like to learn more about how Epiq can help you to take the initiative in transforming the business of law at your organization, contact us.