New research about legal operations is ‘at a crossroads,’ consortium leaders say

Ari Kaplan recently spoke with Sandra Aldi, the chief marketing officer at Neota Logic; Michael Powers, the global director of product marketing at iManage; and Thomas Suh, the co-founder and chief operating officer for LegalMation.

The three companies are part of a consortium that supported a newly released report called Legal Operations at a Crossroads: Understanding How Corporate Legal Teams Are Driving Innovation and Navigating Digital Transformation in Unique Ways, featuring the perspectives of 30 legal operations leaders from various companies.

They discussed the results and what they indicate about how law departments are leveraging artificial intelligence, automating how they provide legal services, and empowering self-service.

Ari Kaplan: What were the most interesting findings from the report, and how do you see legal operations teams driving change in the current environment, especially since 93% stated that the role of the legal operations professional has expanded?

Sandra Aldi: The report has many great takeaways, so it is hard to select one or two. Technology has allowed legal operations teams to evolve, demonstrate their innovative approach, and impact the business by collaborating more effectively with partner organizations within their companies, including HR, finance and procurement. The feedback around the importance of showing ROI, building their business cases, and using metrics for reporting on the effect of their initiatives was compelling because those efforts are elevating and expanding their role. They are no longer working behind the scenes. They are focused on capturing data and metrics to convey the quantifiable impact they are having.

Ari Kaplan: Seventy percent of the respondents advised that new technology applications raise the profile of the legal department, with several noting the effect of their use of iManage, among other tools. How are corporate legal teams more effectively deploying technology to serve legal and the business units they support?

Michael Powers: The legal operations team is moving from being perceived as a service provider to a strategic business unit. Legal has traditionally lagged behind other parts of the organization in its ability to leverage technology. But as the pressure to do more and become a tactical supporter of the business has increased, they are adopting the tools and the processes that help them leverage technology more effectively as a necessity. As a result, they are increasingly focusing on project management, change management and user engagement to empower broader technology adoption and digital transformation. With more technology comes much more data, driving a data-centric approach to the business and using key performance indicators, analytics and other tools to measure or track the performance of legal. As a result, the legal team takes on more business-critical functions, like compliance and risk management, so deploying technology to support that requirement is becoming crucial.

Ari Kaplan: Eighty percent of the participating leaders reported that their legal departments use AI, with half benefiting from generative AI. Given that there was a specific reference to LegalMation reducing time and cost while standardizing documents and processes, what are some best practices for deploying AI in a corporate law department?

Thomas Suh: If you distill it down to two elements, you will have a successful deployment. The first is leadership buy-in. Leaders must understand that there are better ways to do things, and if you lack support from the top, it is difficult to promote progress. The second, and equally important, is focusing on solving real problems and implementing a practical and purpose-built solution to address them. For example, you need to provide AI to solve a distinct problem in a way that makes life easier. That may sound generic, but the reality is that there is too much noise out there, and users expect to use tools that work without shifting their workflow in a disruptive way or with a steep learning curve but simply plug into a process to tackle a significant pain point.

Ari Kaplan: Eighty-three percent of the leaders I spoke to make accessing legal services easier for their business units, and 53% provide self-serve applications and are building cross-departmental apps or solutions to help them automate broader workflows, including Neota applications covering document automation, workflow approval and legal intake. Do you expect the volume of applications to support automation to rise in the legal department?

Sandra Aldi: Definitely. We see many clients in legal operations functions leveraging existing technology investments more expansively. So they are doing even more with their tools and investing in complementary applications. At Neota, for example, the workflow aspect of our platform is appealing because it allows teams to integrate with other programs. like iManage. Our automation tool serves as a wrapper around an organization’s AI efforts incorporating reasoning and logic rules into their protocols. As technology evolves, legal operations teams will continue to elevate their efforts and spotlight their effect on the business, so they will look for ways to refine and amplify what they are doing.

Ari Kaplan: As the use of technology grows in corporate legal and the focus on data and centralizing documents becomes more prominent, how will this affect workflow?

Michael Powers: This is a central part of the change that we’re seeing with artificial intelligence. The paradigm has shifted from a document storage model to a much more dynamic process in which one can take action on documents that become more closely integrated with the work process. So you are no longer looking at the document as an object. Rather, you are evaluating the information within a record and unlocking the crucial data points previously buried within the text. In this model, the documents and the processes become more dynamic and interconnected with workflow. Users can now unlock content hidden in a document, and that transforms documents from being static elements to drivers of knowledge and efficiency. It enhances the value of those documents. With AI, we are only at the beginning of this trend.

Ari Kaplan: Forty-seven percent of the participants acknowledged a fear of generative AI in their legal department. How do you see leaders navigating concern and caution with the promise of these tools?

Thomas Suh: They are right and should fear generative AI, which has become the hammer that sees everything as a nail. It is just looking for nails to pound down, and we are all getting caught up in that as legal professionals. We assume that generative AI can be applied to all workflows and solve an array of problems. That is wrong. Instead, legal teams should use generative AI in a very limited fashion, which we call a “sprinkle.” We sprinkle generative AI where we need to strategically enhance either existing products or develop new applications. Our goal is always to solve real, practical problems that corporate legal departments are facing by offering solutions that apply to a particular purpose without forcing AI into the workflow. We have arrived at a point where the hype is driving interest, but prospective users need to understand the purpose of generative AI and that it is not for everything.

Michael Powers: I was in a meeting recently where a client wanted to use generative AI to solve a specific business problem, where it was not necessarily a good fit, and our CEO told them that doing it that way would be like using a helicopter to cross the street.

Thomas Suh: Or using a Ferrari to pull a trailer. It needs to be the right fit.

Sandra Aldi: You should not need to reengineer an entire solution to implement AI just to say you’ve incorporated it. We seem to be arriving at a more rational starting point and reducing the attraction to the shiny new object.

Editor’s Note: This interview references research that Ari Kaplan Advisors, an independent advisory company, conducted on behalf of iManage, LegalMation and Neota Logic.

Listen to the complete interview at Reinventing Professionals.

Ari Kaplan regularly interviews leaders in the legal industry and in the broader professional services community to share perspective, highlight transformative change and introduce new technology at his blog and on iTunes.

This column reflects the opinions of the author and not necessarily the views of the ABA Journal—or the American Bar Association.