GenAI-Driven Data Management Is Critical to Law Firm Success

The balance of power between clients and partners has shifted dramatically toward clients. This has triggered a technological evolution in the legal industry, as firms grapple to meet client demands and win more business.

Buyers and consumers of legal services have become increasingly sophisticated. As part of the selection process, clients now delve deeply into a firm’s experience and expertise, rather than lean on personal relationships.

And in the delivery of legal services, clients increasingly assume law firms effectively use rapidly evolving technology. In a 2023 Litera survey of US-based M&A lawyers, 73% of lawyers said their clients ask about their technology stack, specifically when it comes to artificial intelligence.

Marketing, business development, and knowledge management teams have undergone significant changes to adapt to the evolving client landscape. This evolution has paved the way for integration of generative AI with knowledge data, which will play a pivotal role in improving efficiency and meeting client expectations.

As law firms look to adopt AI to solve problems that were previously beyond reach, it’s crucial to first address the key aspects of data and knowledge management that are the building blocks for this new technology.

Legal Evolution

To effectively sell and deliver legal services in today’s landscape of increasing client expectations, marketing, business development, and knowledge management teams need a deep understanding of both technology and data.

Lawyers’ needs have shaped the evolution of knowledge management teams. In the past, a lawyer’s personal knowledge in a specific area of law, industry, or geography was enough to meet clients’ expectations, but now clients require data-driven insights.

To gain a competitive advantage, law firms turn to technology to scale and share collective experiences across the organization.

On the business development front, law firms have primarily focused on building relationships as a means of marketing themselves. This approach is still necessary, but no longer sufficient.

Prospective clients now expect more than personal connections and want detailed information about deals, litigation track records, and other specific aspects of a firm’s experience. Clients seek quick and accurate responses to their inquiries on a granular level and with analytical insights only possible to deliver with technology.

Manual extraction of information from numerous documents is impractical and time-consuming for a single individual. Here, technology plays a vital role in providing the necessary answers promptly and efficiently.

By using the right data and employing technology solutions, law firms can meet the demands of clients and deliver accurate information, demonstrating their expertise and capabilities while providing insights that aren’t possible with manual effort alone.

Leveraging AI

For law firms to effectively combine relationship intelligence with their experience data, it’s crucial to ensure that the technology is used appropriately.

While AI holds great potential to address the challenges faced by business development, marketing, and knowledge management teams, firms can’t afford inaccuracies in the results. Cautionary tales prove the need for well-conceived legal-specific tools in the AI space, such as the lawyer who used ChatGPT to perform legal research and ultimately included a slew of “bogus judicial decisions with bogus quotes and bogus internal citations” in the brief he produced.

To continually evolve and make the most of GenAI, law firms need to undertake three specific actions:

Break down internal silos. By fostering a collaborative environment where information flows seamlessly across departments, firms can leverage a wealth of valuable data for better decision-making.

Tap third-party data sources. By accessing external data to augment their knowledge and integrating this with internal data, firms can gain fresh insights and stay up to date with industry trends.

Convert unstructured data into structured data. Structured data is crucial for making the most of generative AI. By organizing and structuring data in a meaningful way, firms can unlock valuable patterns and relationships hidden within vast data sets.

Future of AI

Consider the age-old challenge lawyers face when a client asks, “What’s market?” In the past, this information would be locked within lawyers’ minds and deal documents, making the task of giving a data-driven answer extremely challenging. So, usually the answer provided is what an individual partner feels is accurate in the moment.

However, AI advancements are shaping the future of marketing, business development, and knowledge management, empowering teams to meet heightened client expectations by unlocking the collective experience and knowledge of a law firm that was previously trapped in siloed systems.

With experience management platforms, firms can connect disparate systems such as time and billing, document management, and customer relationship management, to provide a centralized and singular view of their experience.

Providing real-time, data-driven market insights is just one way that legally focused GenAI technology, combined with experience data, promises to revolutionize marketing, business development, and knowledge management for law firms.

It’s just one reason law firms need to consider structuring their data with one eye on the latest legal-focused GenAI products.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Adam Ryan is vice president of product at Litera, guiding legal work, firm performance and firm governance products. He previously practiced law at Freshfields Bruckhaus Deringer.