5 ways lawyers can use AI right now to transform efficiency

Last updated on 
March 29, 2021

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So far, the legal sector has been pretty slow to harness the power of AI, but all that looks set to change. 2021 will be a decisive year for legal digital transformation, and the growing interest in applying AI and automation to law firm practice is beginning to change the industry. While meaningful transformation will alter the practice of law in significant ways, AI is already being used to support legal professionals and clients alike.  So what are some of the best ways lawyers can harness AI right now to transform firm efficiency?

What’s holding AI back within the legal sector?

Before diving into applications of AI for the legal sector, it’s helpful to address what’s blocking its progress. The legal industry is rooted in tradition, and cultural change has been much more challenging to achieve here than in other industries. Most lawyers have tended to focus on the negatives of digital change than the potential benefits: adapting to new technology and processes takes time and effort; new skills may need to be developed; and tech advancements may render certain jobs obsolete – or at least unrecognizable.

But in spite of the fact that using AI in law is becoming increasingly welcomed, there are still factors holding it back – and one of the biggest stumbling blocks is finding funds. It’s often believed that adopting AI necessitates undergoing a radical overhaul of firm infrastructure, but this isn’t the case. There are plenty of affordable, out-the-box solutions available – and for more complex AI implementations, one alternative is to use equity crowdfunding to help get your AI off the ground. To promote the use of AI within the legal sector, the Law Society has partnered with equity crowdfunding platform Seedrs to help provide funding and create a wider range of AI resources.

How lawyers can use AI

AI within the field of law is far more accessible and affordable than ever, but where do you start with it? Here are some of the simplest and most effective ways lawyers are already using AI to cut down on repetitive firm and case management admin.

1. Contract review

Contracts are absolutely vital for our economic system to function – but the process of reviewing, negotiating and finalizing a contract can be painful. Lawyers for both parties have to manually review, edit and exchange drafts multiple times, and this can be an incredibly lengthy process; according to Gartner, in-house legal departments spend half their time reviewing contracts. Plus, given that contracts can be thousands of pages long and full of tiny details, mistakes are common.

This is why using AI to streamline the contract review process is one of its most effective uses, and startups like Lawgeex, Klarity and Clearlaw are developing AI systems that can automatically absorb contracts, analyze them using natural language processing (NLP) technology, and assess which parts are suitable and which are problematic. According to LawGeex, using their AI tool for contract review can cut costs by 90% and reduce contract review and approval time by 80%.

2. Legal Research

Another area where AI can make huge advances is in legal research. While legal research often needs to be done swiftly and accurately, historically it’s always been a long-winded manual process, where junior lawyers search through physical files to find relevant precedent. It involves examining laws and regulations, providing different legal opinions for cases, and informing legal teams with similar cases. While most lawyers now use software like LexisNexis and Westlaw to help with their research, these tools only offer rudimentary search functionality.

However, recently startups have been turning to AI to optimize the process of legal research – and  companies like Casetext and ROSS Intelligence are creating tools that offer far more than just key-word search capabilities. Because these tools have a high-level semantic understanding of legal phrasing, they’re able to find relevant, existing laws much more quickly than a person can, reducing the workload of lawyers and allowing them to focus on more important aspects of a case. According to Forbes, over 4,500 US law firms already subscribe to Casetext for AI-driven legal research.

3. Billing and payroll

No matter the industry, electronic billing platforms are becoming more and more common – and using AI to manage legal expenditure and create an automatic digital paper trail is another effective way to harness the power of automation. Using AI allows law firms to accurately track finances, reduce paper costs, decrease human errors, and obtain accurate and actionable insights into their legal spending.

Household names like FreshBooks, QuickBooks and Sage Intacct can now automate many of the “worst” Accounts Payable tasks, including the payment and management of invoices, sending estimates, and paying employees and clients. Greater workflow efficiency obviously comes with huge overhead savings – cutting close time by up to 79%, according to Sage.

4. Automatic time tracking

Being able to accurately and automatically track time on matters is another way AI is changing the financial face of the legal sector. It can be hard to know how long it’ll take to close a case, or exactly how much resource you’ll need, and this means overruns often occur – which can lead to client disputes. Yet when lawyers use AI to automatically track all billable legal hours, they’re provided with an honest and transparent way of billing – one that goes a long way in closing communication gaps and keeping clients happy.

Aside from providing clients with transparent billing, AI-powered time tracking software like Timely helps firms understand precise billable ratios and utilization rates across their workforce. Instead of using timers, they automatically capture the time professionals spend on different cases in the background to produce a flawless record of daily activity. Using AI, they can even draft time entries for specific cases using that data. By removing the need to manually track and log hours throughout the day, firms can reclaim hours lost to administrative overhead – as well as review their billable percentage and hours worked in real time.

5. Document automation

Many law firms already use templates to create highly-standardized documents based on data input, like non-disclosure, credi and confidentiality agreements. Using AI for this purpose can save serious amounts of time (up to 70%) on these tasks as well as rule out human error. You can use AI to instantly create all different types of legal documents and templates – from business contracts to wills and trusts –  as well as process documents such as medical records and bank statements for lawsuits.

Tools like Knackly offer a no-code solution to automate PDF, XML and MS Word documents, integrating with firm Law Practice Management Software via an open API. Likewise, LegalUp promises to help you cut down on routine copy/pasting between docuemnts by intelligently incorporating your firm’s knowledge and best practices to create tailored documents. For non-disclosure ageements, there’s Neota’s PerfectNDA – a tool promising fully automated creation, negotiation, execution and filing of your NDAs.


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