Here we outline what legal automation is, how it works, and how legal teams and law firms are using it to increase their impact with limited resources.
Automation in the law still lags behind its potential, while other industries demonstrate impressive advancements through automation.
Digital transformation efforts in the legal industry are maturing and the focus is now on achieving practical, tangible, and measurable outcomes. As machine learning-based “AI” tools are still limited in their abilities and scope, digital transformation in the legal domain has naturally gravitated toward legal automation.
Even though this concept seems familiar from other industries, automation in the legal field is still largely uncharted territory. Apart from document automation solutions such as ContractExpress, HotDocs or LawLift, which have been around for quite some time, the legal value delivery chain is still mostly manual, i.e. not automated.
Table of contents
- Why is the legal industry slow to adopt automation?
- What is legal automation?
- Benefits of legal automation
- Which legal areas are best suited for automation?
- Legal automation: enormous untapped potential
- Legal automation: ROI and applications vary
- Automation and law: A perfect match with some challenges
- Legal automation FAQs
- With legal automation, it’s best to think big, but start small
Why is the legal industry slow to adopt automation?
There are many reasons why the legal industry is lagging behind other industries when it comes to embracing automation:
- Current business models focus on “billable hours” and “fully engaged” teams. In these business models, there is often little interest in becoming more efficient through legal automation.
- Many lawyers are still unaware of how workflow automation could look in their respective fields and how it can be operationalized. Lawyers are quick in labeling their work as “bespoke” or “too complex”.
- There are not many legal operations tools in the market that cater to the specific needs of law firms and/or legal departments.
- Often it is not easy to spot the areas, workflows, and processes that are suitable for automation.
What is legal automation?
In a nutshell: the machine execution of legal tasks, processes, and workflows, in part or entirety.
The term “Legal Automation” encompasses the design, management, execution, and automation of legal tasks, workflows, processes, and decision-making, based on pre-defined rules.
Benefits of legal automation
Automating legal work allows firms, corporates, as well as any other organization where lawyers work, to streamline, accelerate, manage and measure legal and legal-related work. By using workflow automation, processes, and tasks, significant improvements can be made in:
- Job Satisfaction
The General Counsel’s Guide to No-code Automation
Find out how in-house legal teams use no-code to save time, increase capacity and provide faster services to internal clients.
Download your guide now
Which legal areas are best suited for automation?
To varying degrees, all legal areas include repetitive, “standardizable” legal inquiries and assessments that are ripe for automation. For bespoke work, as well as highly unique or complex cases, automation may not always be feasible. However, a large part of legal work is prone to standardization and thus automation. The ratio between bespoke and standardizable legal work is often wrongly estimated, erring on the side of the uniqueness and complexity of the task at hand.
In fact, complex tasks also consist of many smaller sub-tasks where automation can be implemented. Consider the end-to-end process of manufacturing a car; a very complex process, which cannot be automated in its entirety, especially when it comes to planning, testing, quality, strategy, as well as aspects of the manufacturing process itself. The same applies to legal tasks.
The goal is not to automate 100% of a legal task, but rather to achieve efficiency gains however possible.
Legal automation software — in its myriad forms — enables professionals in the legal field to build, model, and execute, decision- and process-based logic. From a technical perspective, legal automation software generates an output (documents, emails, data sets, etc.) from an input layer.
Legal automation is possible in all legal areas. However, some areas of law are more suited to automation than others; these areas of law often include the following characteristics:
- Clearly defined (legal) rules and processes
- The complexity of the underlying logic is not too complex
- Question and problems that routinely and often recur
- Low level of fact-finding
Legal automation: enormous untapped potential
The application of legal rules is often standardized — can it therefore also be automated?
Many lawyers will answer: “Absolutely not! The law is far too complex for that.” In my opinion, a different legal guideline would be the right answer to this question, namely “it depends”. All too often, it is human factors, rather than the law itself, that stand in the way of automation.
One problem lies in the fact that most lawyers think they know exactly how to do things right and therefore do not need a computer to do things for them.
Today’s law firms do not encourage innovation or automation.
While automation may create added value for them, implementing it requires standardization and automation itself. Not only do individuals have to spend time on this, but the right structures are also needed to make this possible.
The widespread assumption that lawyers make no mistakes entails a belief that any technical solution can only be worse than its human counterpart.
This phenomenon can often be observed in the field of document recognition. If a provider of software with a deep learning function promises that their software would recognize 90% of relevant documents, it is dismissed as unsuitable. Because an associate could do this better. The fact that the associate can become overtired or inattentive, which could lead to inaccuracy, is not considered.
A certain degree of skepticism about technical innovation is necessary. But human capabilities should not be overestimated.
Legal automation: ROI and applications vary
Another problem lies in the overall structure of law firms, where the lawyer who has the highest hourly account at the end of the month gets a bonus. For in-house counsel, on the other hand, the number of hours or cases is less important to their monthly earnings.
Nevertheless, some in-house lawyers may be afraid that their job will be in jeopardy if some of their client’s questions are answered by machines. This perspective is shortsighted.
If standardized tasks are solved by machines, then the in-house counsel could address issues that are strategically and economically more important to the company.
Legal document automation is often worthwhile, but benefits depend on the specific area and topical focus. Two mistakes should always be avoided:
1. Lack of a cost-benefit analysis.
Not every investment in technology makes economic sense. Before committing to a new project, a cost-benefit analysis should be carried out. Ideally, if a particular process is accelerated by automation, and hours are freed up for a large number of employees as a result, the costs of implementing that automation will more than pay off.
2. Focusing too much on the technology and losing sight of the people and processes it needs to serve.
Technology alone is not the solution. A well-known methodology for organization transformation adopted by the legal tech community is “People, Processes, Technology”. The order of these words is not a coincidence; technology should be the last step and always fit harmoniously with people and processes.
First and foremost, we need people who understand and can work with the technology in question. We also need end-users to be able to interact with it. Lastly, we need it to integrate seamlessly with the required processes.
Many software products have failed because the technology did not deliver on the aforementioned points.
Automation and law: A perfect match with some challenges
Two brief examples highlight scenarios in which automation could offer added value:
1. A new document is created from a technical template using a form consisting of several modules. Alternatively, in the case of a non-legal user, the same document is created with the help of technical assistance. If a (complex) contract is to be created, this can be done more easily using an automated process. For the legal department, it means less work; for the sales department, it accelerates the process to contract conclusion.
2. Guidelines are often drafted by legal departments and are often very complex and confusing for non-legal stakeholders. Interactive interfaces — available immediately for everyone within a company— can greatly speed up the process, which may have to be completed hundreds of times in the group. This also makes it possible to shed more light on individual points.
Automation and law are more closely related than one would suspect. To achieve added value, prejudices must be eliminated and necessary structures created. We are only at the beginning of recognizing the various application areas and improving and refining the existing solutions.
About the author
Nicolai Behr is a Partner with Baker McKenzie in Munich. He is a member of the Global Compliance and Investigations Steering Committee and co-heads the compliance practice in Germany. He is a member of the Global Innovation Committee of Baker McKenzie and co-heads the innovation and Legal Tech team for Baker McKenzie Germany/Austria. He co-chairs the committee “International Affairs” of the German Institute for Compliance (DICO). Nicolai is a regular speaker and author on compliance, white collar crime, innovation and Legal Tech topics.
The text above is an excerpt from the article by Dr. Nicolai Behr, “Automationen im Recht – Warum wir es nicht angehen”, Rethinking Law (REL1300577), pp. 68 ‑ 71.
Legal automation FAQs
In short, automation in law is the expedition and automation of legal processes and workflows, partially or entirely. Common examples of legal automation include automated intake, risk scoring, and contract generation.
Most instances of legal automation involve some form of input, processing, and output. The input could be information or context around a request, or essential personal information pertinent to a contract. Processing involves taking that input and applying additional context, calculating a risk score, or routing it to the right expert or digital tool. Output could be a contract, a decision, or simply an entry into a central database. To see it for yourself, book a demo or start a free trial of BRYTER.
The best legal tasks to automate are repetitive, standardized, or templated. Legal intake and assessments are clear cases for automation, as are tasks with clearly defined rules and processes, lower complexity, and a high level of recurrence. For more info, read our article “How Legal Teams Determine What They Can (and Can’t) Automate.”
It’s best to have a clear idea of what you are trying to achieve with legal automation first. We can help you ideate on use cases and share what’s possible with legal automation. Book a demo and ideation session with us today!
With legal automation, it’s best to think big, but start small
The best approach to corporate legal automation is to start small and focused. This means identifying the legal tasks that recur most often and beginning to strategically add layers of automation to them, working closely with a legal engineer. Once you successfully implement legal automation in one area, it will be easier to branch out from there and automate other areas.
The practice of legal automation is quickly taking off. In fact, McKinsey estimates that 23 percent of the manual tasks currently done by lawyers could be automated, and major companies like TD SYNNEX are already adopting automation to save as much as 95% of the time previously spent on manual work.
When you’re ready to explore an intuitive and fast legal automation platform, book a demo to learn how BRYTER can help your legal team make twice the impact in half the time.