April 8, 2019

Artificial Intelligence to AFAs: 9 Takeaways From Goodwin’s Legal Operations Roundtable

Goodwin recently hosted its 2nd Annual Legal Operations Roundtable at its New York office, bringing together legal operations executives and general counsel to explore how the legal industry continues to evolve. Given the rapid advancements in technology along with the continuous pressure to contain costs and increase efficiency, it’s becoming increasingly important for those in legal operations to collaborate and share their various insights and experiences.

Here are some highlights from the day-long discussion:

1. Human Intelligence vs. Artificial Intelligence.

Whether you call it machine learning, artificial intelligence or something more sinister, AI was top of mind among roundtable participants, many of whom had embraced AI or were studying the technology’s potential. In the past, the chief concern was whether advanced computing systems would someday replace lawyers. Today more companies are exploring AI as a way to increase efficiency and address more routine aspects of the profession, freeing lawyers to tackle more complicated matters. “While initially when it came out, it was quite hyped up and spelled doom and gloom,” said Patty Johansen, Goodwin’s Director of Knowledge Management. “Thankfully that’s not true. Now that has slowed down and reality has kicked in. AI is not replacing lawyers – it’s making them faster, smarter and better.”

2. Speak the Same Language.

When it comes to legal services, transparency is essential. Whether it’s scoping a matter, staffing a litigation, providing alternative fees or explaining a bill, clients and their firms must communicate clearly. One suggestion was for firms to share their in-house taxonomy when it comes to matter and billing codes so both sides could make apples-to-apples determinations about costs and objectives. “I think that would be helpful in making sure we’re all speaking the same language,” said a legal operations executive at a large Boston Investment Bank.

3. Knowledge is Power.

A number of companies represented had knowledge management (KM) systems in place, while others were only beginning what can be a long and sometimes tedious process. Yet the bigger challenge can be persuading people in an organization of the value of KM. “I think you have to show them the benefits to the business,” said Anne Stemlar, Goodwin’s Managing Director of Knowledge Management and Research. “You might want to incentivize, maybe a contest, or give prizes for doing certain things.”

4. Forging Powerful Partnerships.

Companies have traditionally used law firms to advise them on matters of law only. But that relationship is evolving rapidly and firms like Goodwin are offering clients consultation on everything from e-billing systems to KM, project and program management, product testing, privacy and data security matters, crisis communications and diversity and inclusion. Mike Caplan, Goodwin’s Chief Operating Officer, encourages companies to find out what firms provide outside of legal services. “You should be utilizing everything those departments have to offer,” he said.

5. Everyone Deserves a Seat at the Table.

Improving diversity and inclusion (D+I) throughout an organization is not simply the right thing to do, it’s the smart thing to do. D+I is making companies more innovative and more profitable. How do you attract, retain and advance a diverse workforce? “We challenged our leaders to own a piece of the conversation,” said Goodwin’s Director of Diversity and Inclusion. “This is a family initiative. We would never get this job done if it was just our team of four staff. But we’ve got an extended family of people to get the job done.”

6. Efficiency is Everything.

The majority of companies suggested they’re under increasing pressure to do more with less. There are a number of organizations that now help legal ops organizations realize that goal, such as the Corporate Legal Operations Consortium (CLOC), which helps members develop best practices designed to get the most from their legal spend. Kevin Clem, Chief Commercial Officer, HBR Consulting, suggested evaluating maturity models to develop a better roadmap and identify areas of need. “If you’re efficient with law firm management, it can go directly to your bottom line,” Clem said. He also said legal departments need to adopt a more corporate mindset.  “The law department of the future will be agile and tech-minded,” he said. “Law departments have been slower to adopt that. We need to move more rapidly.”

7. Helping Those Who Need it Most.

Lawyers are as busy as ever, but those who make time for pro bono work report that the experience is often more rewarding than their paid work. “Whether you’re a lawyer doing pro bono or a staff member on a service project, how did you feel at the end of that day? Whether building a house for Habitat for Humanity or helping the person who wanted to become a U.S. citizen, you feel great about yourself, about your company and about your colleagues,” said Joe Ruffino, an in-house lawyer at IBM. Goodwin regularly teams up with clients to provide turn-key legal clinics, particularly in the areas of citizenship and immigration. “Pro bono offers us some work-work balance, a little spice to our workday life and a nice add-on to what you do,” said Carolyn Rosenthal, Goodwin’s Director of Pro Bono. 

8. Less is More.

A number of in-house counsel reported a desire to scale back on the number of firms they engage each year. A survey of invitees in advance of the roundtable revealed 55 percent used more than 50 law firms last year . Many of them were looking to reduce that number in an effort to increase efficiency and forge deeper relationships with their outside counsel. “I am constantly asking lawyers to discuss efficiencies and they aren’t doing it,” said a client attendee. “At least not yet. You have to offer to have your pricing person talk to my pricing person.”

9. RFPs – Love Them or Leave Them?

It was unclear who was less a fan of the RFP process – those soliciting them or those submitting them. One thing everyone agreed to include: experience, expertise and pricing. RFP’s were better received when they included specifics such as conflicts, outside general counsel guidelines, approach to pricing, diversity and inclusion, pro bono, specific experience, value adds, health checks and references. “That is where it’s much more fruitful for us,” said Nancy Kostakos, Goodwin’s Chief Marketing Officer. “We’re not just guessing about what we’re supposed to be answering.”