How should a business adapt to changes in technology?
The increasing rise in new or disruptive technologies is causing a wave of change across traditional businesses (including law firms!), requiring many industries and professions to re-think the way they provide their services.
Expectations for technologies collectively known as artificial intelligence or AI are at new highs meaning existing organisations need to challenge their historical business models and innovate regarding the way in which they use technology as part of their daily services.
These technologies can either replace human involvement in some way or supplement a human’s capacity to complete a process more effectively and accurately. But can they really substitute the role of a person by replacing routine tasks with speed and precision?
AI technologies are already helping to improve client service delivery in a range of businesses. With increasing competition from start-ups who have built their business models around using technology to streamline or automate routine work, there is increasing pressure on existing businesses to reduce cost by adopting new processes making them more efficient and better able to manage risk and performance.
But this demand for greater efficiencies brings an even greater challenge for traditional revenue models. Businesses can’t pass on AI investment costs in their fees but they can take advantage of the future savings offered by technology and alternative pricing models in a climate where clients and customers are continually looking to squeeze spending costs.
Innovation brings credibility
To keep a competitive edge, businesses need to be at the forefront of developments by investing in new technologies and new ways of working. Implemented properly, the adoption of AI technology could significantly strengthen customer relationships, achieving greater efficiencies and enabling a broader, more valuable service.
Many businesses, have already been making incremental changes to improve core productivity and embrace change. This can include:
- software that scans and interprets written contracts in commercial risk assessments and then presents the results via an online dashboard to assess risk more clearly;
- an automated drafting system which produces a suite of documents by answering a short questionnaire;
- a virtual assistant that makes quicker and better decisions, such as the best order to renegotiate customer contracts; and
- software that searches largely unstructured data to retrieve and summarise specific information, such as searching regulatory registers to verify client details or searching official title deeds so notices can be served on the correct property owners.
Long term impact
The above examples are ways in which businesses, including law firms, are already experimenting with AI. But in every business there will always be some roles which cannot be replaced by technology. Striking the right balance between human and machine capabilities will be critical. For example, reviewing complex contracts as part of a due diligence exercise will not wholly remove the requirement for analysing those results and making judgments on their importance in the wider context of a transaction.
Whilst some roles cannot be replaced by technology, one of the consequences of disaggregation and cost reduction for high volume or repetitive work is a reduction in the person-power required on specific projects, especially at a more junior level. This has an important implication on the traditional pyramid structure of many businesses, particularly professional services firms.
Does innovation in technology therefore mean job losses? Not necessarily. One clear benefit is that by automating repetitive, low value tasks staff will be able to concentrate on specialist, high value tasks where they can really add benefit for a customer, using knowledge, judgment and intelligence which can’t be replicated by a machine.
Expectations are high for these future leaders. They will be responsible for pioneering new solution driven business models whilst ensuring modern advances deliver exacting standards without compromising on quality and attention to detail.
As part of their innovation pathway, all businesses should now be looking to recruit future staff who can contribute to alternative service offerings and to broaden their expertise in the technological sphere.
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