The rapid pace of automation technology and the changing nature of work are key challenges for law firms across Australia as they strive to build a sustainable future. KPMG specialists explored the opportunity for law firms to embrace ‘the bots’ and rethink their workplaces as part of this journey, at breakfast events held in Melbourne and Sydney. Here is a selection of insights that they shared.
The impact of technology on work has seen humans and machines collaborate, manual tasks become automated, agility become the norm, and traditional career paths change.
In the legal sector, this disruption presents vast challenges, as firms struggle to move from traditional hierarchies, manual research requirements, time-based billing models, and other set ways of operating, into tech-empowered models fit for the future.
Facing into this presents a chance for law firms to create the most relevant and optimal workforce to be sustainable long term. A new approach could enable them to fulfil ambitious growth strategies, and be equipped to handle constant disruption, deliver to evolving client demands, and to attract and retain good staff.
Drawing on the insights of four KPMG specialists, we look at the fundamental shifts under way, the opportunities presented to law firms by technology, how the ‘bots’ can be embraced, how to work with demographic shifts, and how the working environment needs to align to have the best chance at success.
Two eye-opening statements set the scene for the Future of work and leadership in the legal sector discussions.
One was a quote from author Malcom Gladwell, who thinks that lawyers are worried about jobs being replaced by Artificial Intelligence (AI), and he agrees that they should be worried.
The second quote was from Actuate Law’s Martin Tully, who believes that new technology will be the ‘prep cook’ for the ‘chef’ who is the lawyer.
The references opened the way for a discussion about how technology, particularly robotic automation and cognitive computing, was impacting the field of law, and what firms need to do now to ensure they are on the front foot of disruption.
In Sydney, Steve Clark, Director, People & Change, KPMG, said the impact of technologies would not only change how the legal profession operates, but how lawyers acquire skills.
“The work situation is more complex and people are constantly up-skilling,” he said.
Adding to the changes brought by technology is the shift in the demographics of the legal work force, which can now involve up to five generations in one company.
“With Generation Y [millennials] becoming the mainstay of the workforce, there has been discussion that employers will need to adapt and change to attract them,” Clark said.
Tracy Moore, Director, Solution 49x, KPMG, said that technology in support of legal work, is improving at an immensely rapid pace, and so is its uptake, enabled by advances in machine capabilities to understand language and meaning.
“In the last 12 months there have been 1,800 different technology startup companies in the law sector specifically that have been given over $1 million in VC funds,” Moore said, referring to information on AngelList, which hosts a register of Silicon Valley Venture Capital (VC) investments.
She gave the example of the Michael Cohen case in the US, which was given formal approval to use technology based review tools to explore documents, and to establish which ones have attorney/client privilege.
Another example offered was that of Adam Ziegler (MD Harvard Law School Library Innovation Lab) and his CaseLaw Access Project, which is an effort to digitise the entire historical record of US court opinions and make that data available for legal algorithms to read and train on.
Moore gave other examples of emerging AI tools to augment the work of lawyers, such as:
Moore said it is vital to explore the technologies and to understand their potential impact on the legal profession. She said to look at four areas:
“The key focus for the law firm of today and the future is to understand their own business and analyse what are their key strengths, and work out how they can utilise technology to take advantage of that,” Moore said.
Lisa Barry, Partner, People & Change, KPMG, said rather than fear robotic process automation, the new technology should be seen as a way to improve service to clients, and to enable people to engage in higher value tasks.
Barry said embracing robotics is also a chance to ensure you have a relevant workforce, the right culture to support new ways of working, the right approaches to succession planning, and more.
“We have a very optimistic view of bots – we love robots and we are not going to war against the bots at all,” she said. “We have a higher regard for the humans, so we have been concentrating on a conversation that we call the ‘Rise of the humans’.
“Creativity in law has never been more important. Creative, collaborative lawyers – how do we encourage that? How do we use the bots to take care of anything that is thoroughly rules based, releasing humans the opportunity to do things that only humans can do?”
Moore added that it is important to recognise that robotics are generally very specific and deep in their knowledge, and there are none that can “holistically run a firm”.
“Take a holistic view – which tasks could benefit from automation? Think of the holistic design of how your people and clients could benefit from these specific tools. Then pilot and experiment,” Moore said.
The change in workplace dynamics, with millennial taking up the majority of the workforce in the future, means that organisations need to think about how to retain and attract them, Clark said.
“We need to harvest the needs of younger workers, who want to try different things in the workplace, by creating programs that allow them to move around to different departments within the business,” he said.
With technology meaning people can work from anywhere at any time, it is also vital to shake up the 9:00am-5:00pm model and be open to agility, Clark said.
Moore added that with AI, “you will see the partnership ladder is changing and there are now new tasks, roles and positions that didn’t exist even a year ago, let alone 5 years ago”.
“I think we will see more legal engineering regarding data and algorithms, and how we turn that data into knowledge to make more effective decisions. A knock on from that is having the skill set within legal firms to understand how algorithms will impact on the products and services legal firms currently use to access data. They may need to broaden their horizons to alternate forms of information. All law firms will need to have skills inside their offices to answer difficult questions and interpret them in order to give their clients the best answer.”
That said – engaging AI doesn’t mean critical thinking will go out of date.
“Empathy, instinctive decision-making and specialist knowledge give law firms a competitive advantage, and I don’t see how AI can replace that,” Moore said.
Niki Castello, Change Manager, KPMG, said with the nature of work changing so rapidly (across many industries not just law), the workplace and its practices need to be re-aligned.
“Business landscapes are challenged by continuous innovation and disruption, and organisations therefore need flexibility to anticipate and respond to change, to outmanoeuvre the competition and to remain in front,” she said.
Castello said the changes offer a chance to consider the trends that are relevant to your organisation, such as the physical environment, expectations of behaviours, technology enablers, billing models, and the roles of people.
“There is also a chance to use new technologies to create a paper-free environment (by digitising files rather than using storage).”
Castello said KPMG, as an example, has embraced an agile approach to work.
“It really has inspired a more collaborative and flexible culture that enables people to choose how and where they want to work every day.”
This is facilitated with portable technology devices that enable anytime, anywhere work.
“All firms will need to take stock of what are their client’s needs and are they meeting them? Things need to be made simple for their clients. Mobile technology is imperative to speed decision-making and enable both the firm and clients to communicate more effectively and efficiently.”
Moore said that technology changes are so rapid that the sooner law firms get started on embracing the potential, the better.
“Law firms need to take advantage of technology by understanding what they do well, what they want to focus on and what their clients need. They then need to decide on which technology best fulfils their needs and apply that as a priority.”
Barry said it is an opportunity to ‘reimagine’ every layer of the business, from succession planning to culture, what the ‘partner of the future’ looks like, how the ‘bots’ integrate, and how to encourage creative collaboration amongst the human lawyers.
Castello summed up that to make change happen, you need to take people on the journey.
“You need to get your employees involved from all levels including graduates,” she said.
“It’s an entirely new way of imagining the organisation for the future. Think deeply, have a blank canvas, and do something about it,” Barry challenged.