This article was originally published in Legal Dive.
While there’s been a lot of discussion about the benefits of AI in the legal profession, much of the chatter focuses on the technology’s potential rather than its practical application. While it’s true that AI is rapidly evolving and promises to revolutionize corporate legal as we know it, the reality is that there are real business benefits to be had today.
Recognizing those benefits requires cutting through the noise surrounding AI and understanding how to use it to achieve greater efficiency and optimal business outcomes —right now. After all, it’s one thing to plan for the future, but the reality is that corporate legal departments have challenges they need to solve immediately. They must find efficiencies where they can, lower or create more predictability around their legal spend, improve matter outcomes, and more.
Here’s how AI can help with each of these objectives.
Legal bill review
Improved efficiency, greater accuracy, and reduced spend leakage
Making sure that legal invoices are accurate and free of errors or billing guideline violations is critical to reducing spend leakage, but there are problems with having your attorneys undertake this responsibility. First, it takes lawyers away from being able to practice law and thus add value to the business. Second, humans can make mistakes, the chances of which are amplified when someone is spending hours analyzing every line item (and they don’t want to do it).
Inserting AI into the bill review process makes the entire operation much more accurate and efficient. AI can quickly find patterns in invoices and automatically flag potential guideline violations. These violations can then be addressed by a human, but not until the software alerts them to a problem. They can then examine the issue and contact the law firm to rectify it if necessary.
This combination of AI and human input is key to reducing legal spend leakage and enhancing efficiencies. It all translates to money saved and added value, which puts the corporate legal departments in an excellent position to be a business driver for the larger organization.
Spend management
Greater visibility, better predictability, and less manual invoice entry
In 2024, companies will continue to look for their legal departments to control costs. Teams must be able to gain better visibility into their spend so they can proactively and correctly identify opportunities for savings.
While AI can comb through invoices and analyze legal spend to identify areas of improvement, that’s only the beginning. By applying historical analytics to past matters, AI can help legal departments accurately predict budget and matter cycle times, giving corporate legal teams a better idea of how much it will cost to litigate a matter.
AI can also replace the need for manual invoice entry. Bills that are received in Microsoft Word or PDF format, for example, need to either be converted into standardized LEDES format, manually entered into a spend management system, or worse, paid manually outside of the system and completely untracked. Fortunately, that no longer must be done by corporate attorneys. The software can scan invoices in any format and automatically—and accurately—convert them to LEDES.
Matter management
Better firm selection and improved outcomes
More than handling matters efficiently and within budget, corporate counsel needs matters to come to desirable outcomes.
That all hinges on choosing the right firm for the right matter. Doing that requires actionable insights driven by data, not gut instinct or recency bias.
AI can collect and analyze information from past similar matters and provide legal departments with recommendations on which firm is most appropriate for a particular case. Information gathered can include how much time it took for a firm to resolve a matter, how much it cost to do so, and whether the desired outcome was achieved.
With this information in hand before an engagement, corporate attorneys do not have to make an educated guess as to which firm to select. They already know which organization is going to deliver what is needed—and how much it will cost and how long it will take. Internal counsel can move forward with confidence and work with the firm to create an accurate budget, estimated timeline, and more. Everyone will be on the same page, resulting in better collaboration and improved outcomes.
There are legitimate, low-risk, high-impact ways to introduce AI into legal operations today, mainly in the bill review and matter planning processes. As the technology evolves, AI may get closer to cases, but there’s no need to wait for that to happen. Corporate legal departments can start using AI today and see an immediate impact on the business of law.