Ascertus’ Perspective on Legal Tech Trends in 2024

17
Jan
2024

Damian Jeal

Coming into 2023, who would have thought that generative AI will cause such a frenzy globally. After all, not only has AI been on the horizon for a long time, but it has already been in use, even though it might be invisible to us as end users. And perhaps therein lies the difference between AI and generative AI – the latter uses natural (i.e., human) language processing, making the technology supremely accessible to everyone. Hence, it’s popularity and the widespread embrace of ChatGPT.

2024 is going to be an interesting year in legal tech – and I say this, based on observations and insights gleaned from speaking to technology vendors, customers and indeed the end users in the industry. 

Generative AI “FOMO” will settle

Generative AI has captivated us, and rightly so. It’s easy to see its potential across industry sectors, which is why technology vendors, corporate legal departments and law firms are all investing significant funds in the pursuit of adopting this technology. No one wants to be left behind! 

However, generative AI is still in the very early stage of its development. Application vendors are actively honing this technology to iron out fundamental issues such as hallucinations, biases and glitches whilst simultaneously trying to devise practical use cases to deliver material value to legal organisations. In 2024, this ‘fear of missing out’ (FOMO) sentiment with regards to generative AI adoption will give way to a more practical and thought-through approach, as organisations look to ensure that there is a quantifiable ROI in a technology that is thus far also fairly costly to run. 

Additionally, there will be growing recognition that safe use of generative AI tools requires clearly defined policies to embed data protection safeguards for compliance and intellectual property. Lawyers and other end users unintentionally feeding confidential business data to OpenAI ChatGPT is highly risky. 

Winning the data battle will become a forced priority 

Whilst a large proportion of law firms have moved to the cloud, there is still a significant number that is yet to embrace the cloud computing model of technology consumption, mostly on account of the cost of transition. Why? In firms using on-premises business applications, it isn’t unusual for data to be spread across numerous drives, repositories, user desktops and even in physical warehouses. Lawyers are often loathed to dispose of data, on the off chance that they might need it at some point in the future. This resulting data volume and information sprawl makes transitioning all the records to the cloud extremely time-intensive and expensive.

Nevertheless, rationalisation of data, based on a clearly defined data strategy, will become a necessity in order to minimise cost of storing data and risk of data loss. Law firms are lucrative targets for cybercriminals. The cybersecurity incident at CTS that impacted over 80 law firms, is the most recent reminder that proactive data management alongside records management for data protection compliance must be a priority. Over a month on, restoration of systems at CTS still continues today and potentially will continue for a while yet. 

No generative AI without cloud 

If firms are to take advantage of technological advancements – like generative AI – cloud adoption is a prerequisite. Take Microsoft. The company is fast retiring its on-premises services, to become a wholly cloud offering. Office 365, the application within which lawyers live and breathe, is part of Microsoft 365, which is fully cloud. If firms want to take advantage of Microsoft Copilot, Microsoft’s AI tool, adoption of Microsoft 365 is in fact almost a precondition. Likewise, the document management system (DMS) is another indispensable application for lawyers, and DMS vendors are now also following Microsoft’s cloud-native approach to software development.

Best-of-breed applications will be the direction of travel 

With technology having become intrinsic in our daily personal lives, the current generation of workforce expects access to a reasonable standard of the same in their workplace too. Hybrid working has further reinforced need for the same. Advancements in technology and integration complexities alongside business imperatives such as compliance and security will intuitively drive organisations towards adoption of best-of-breed systems. 

Particularly in smaller and growing firms, this need for adoption of best-of-breed applications will push them to revisit their core IT infrastructure and devise an upgrade strategy – not just to meet current business needs but also to future-proof investment. Use of old, on-premises IT infrastructure potentially create a competitive disadvantage. 

At a macro level, economic uncertainties are likely to continue in 2024. Similar to 2023, organisations will actively look for ways to improve business efficiency, enhance client service, and reduce costs. This need to make cost savings will also be the key driver for investment in new technology – and at the risk of a stating a cliché – in some form of AI. The legal sector is gripped by this technology!