Law Firms Need To ‘Fail Fast’ When Implementing An AI Strategy [Sponsored]

February 23, 2024 (3 min read)

By Geoffrey D. Ivnik, Esq. | Director of Large Markets, LexisNexis

Law firms may have been a bit cautious about the emergence of generative artificial intelligence (Gen AI) technology, but they are quickly acquiring Gen AI tools and trying to figure out how to integrate them into their workflows. Legal tech experts advise the best thing they can do right now is take a moment to set their Gen AI adoption strategy.

The LexisNexis 2024 Investing in Legal Innovation Survey: The Rise of Gen AI at Top Firms & Corporations, surveyed managing partners and other senior leaders at large law firms, as well as executives in corporate legal departments at Fortune 1000 companies, to better understand the business impact of Gen AI technology on the legal industry. Our survey found that 53% of Am Law 200 firms have already purchased Legal AI tools and that 43% of Am Law 200 firms report currently having a dedicated budget line item for Gen AI solutions.

But the wisest approach that law firm leaders can take right now with Legal AI — Gen AI tools trained for the legal profession — is to focus on strategic implementation and careful adoption, according to panelists at one of the featured sessions during a recent Wall Street Journal event for law firm managing partners that was sponsored by LexisNexis.

“If you form a strategy, understand where the automation potential is, know where you can accelerate efficiencies, and then build your technology stack in line with that strategy, there is tremendous value with Gen AI,” said Ilona Logvinova, managing counsel and head of innovation for McKinsey Legal. “The blueprint for law firms is start with a strategy, figure out what you want to do and what kind of value capture you are looking for as an organization.”

The McKinsey team stresses to law firms the necessity of a strategic approach when implementing Gen AI into their workflows. Careful evaluation of Legal AI vendors and defining what the organization hopes to achieve from the technology are among the key first steps to take.

“I think there is going to be a mixed-tech strategy here for law firms,” said Alison Bain-Lucey, managing counsel of the technology legal team for McKinsey & Company. “When you look at a law firm’s core tech platforms — such as email, file sharing or video conferencing — they are all coming with AI features right now. Those of us who are practicing lawyers need to really think about where the knowledge is coming from with the AI tools we adopt.”

The experts note that integration of Gen AI into law firm operations will ultimately require a full-scale re-imagination of the firm’s workflows. But for now, the focus should be on moving from investment to thoughtful implementation of these tools.

 “The moment for law firms right now is about defining their value capture. If 2023 was the proof of concept for generative AI, 2024 is really about the application, implementation, and the right sort of adoption and pilots,” said Logvinova. “I think getting the pilots right internally is no small feat, especially when lawyers are the ones who are participating in your pilots, because you need to prove that lawyers really will use the technology.”

Logvinova shared a best practice for how to think about these law firm pilot tests is to focus on “failing fast” as a metric of success. If firm leaders can overcome the stigma that failure is always unacceptable, they will discover that failing is a good thing when it comes to technology adoption if it can be done efficiently. She noted the McKinsey team advocates “two-week sprints” in which they pilot a new tech implementation for two weeks and then evaluate where the adoption worked and where it failed, then adjust their overall strategy accordingly.

This article was based on one of the panel discussions at the Wall Street Journal event, “What Every Managing Partner & C-Suite Leader Needs to Know About Legal AI,” which took place on January 31^st in New York City. Watch the entire session, Navigating Opportunities: Finding Benefits in AI Growth, for more insights from industry leaders.