As AI’s presence in the legal industry grows and becomes more complex and intertwined with the business of law, a new white paper finds that this is no time for bystanders
As many law firm leaders assess their top priorities and challenges for the coming year, there may be one that some leaders are even reluctant to admit or are even talk about: That, at some level, these leaders know they will need to act decisively amid a wave of tremendous change within the legal profession.
And while many law firm leaders understand that this sweeping change has its roots in some major socio-economic movements — such as rising geo-political and economic headwinds, societal shifts, and of course, the impact of advanced technology — they also know these trends will greatly impact their chief areas of responsibility, such as managing client relationships and legal demand, addressing talent concerns, and assessing the impact of new technology. When all this is taken into account, it creates a potent mix that could alter how law firm leaders approach the future operation of their firms and the overall business of law.
To examine these developments more closely, the Thomson Reuters Institute has published a new white paper, The Future of the Law Firm, that offers law firm leaders some insight into the changes swirling around the legal market and how decisive action is needed to keep law firms sustainable, profitable, and moving forward. The paper was authored by a trio of legal industry experts within Thomson Reuters — Raghu Ramanathan, President of Legal Professionals; Steve Assie, General Manager of Global Large Law Firms; and Elizabeth (Lizzy) Duffy, Senior Director of the Thomson Reuters Institute.
You can download a full copy of the white paper,
The Future of the Law Firm, here
Indeed, this time of tremendous change cannot be simply waited out. As the paper makes clear, no longer can law firms hover on the sidelines, waiting for others to try out new ideas and see what works — because at this time, there is simply no room for bystanders.
To help law firm leaders as they navigate this changing landscape, the paper more fully explores the impact of generative AI (GenAI) on the law firm business model. This is a critical point for discussion because managing technological adoption within a law firm is tied to leaders’ key responsibilities, such as how firms communicate with clients, entice new hires, and price their legal services. Obviously, technology carries a heavy influence on all these areas, and GenAI is emerging as a significant driver in reshaping how law firm leadership responds.
Key points
There were several other key points outlined in the paper, including:
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- Perception of AI within the legal industry — In May 2024, 74% of law firm professionals said they believe AI is a force for good within the industry, and 64% said they have tried using GenAI as a starting point for contract drafting, research, and document summarization. In fact, 62% said they found using AI produced a basic starting point for work projects while 20% found it delivered a strong starting point.
- Emergence of the AI adopter scale — After surveying law firm professionals on where their firms currently stand regard AI use, we then grouped those classified as Early Adopters and Innovators as AI Leaders, and those classified as Laggards and Late Majority as AI Followers. And already, we’re seeing that AI Leaders are gaining significant benefits compared to AI Followers as the gap between AI Leaders and Followers widens at an accelerated pace.
- Clients are moving faster than their law firms in GenAI adoption — Over the six-month period from April to October 2024, corporate legal departments outpaced law firms in advancing AI leadership. They not only reduced the number of AI Followers but also increased AI Leaders more rapidly, resulting in a higher proportion of AI Leaders than AI Followers — a milestone that law firms have yet to achieve.
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For law firms, this paper outlines an evolution in the work that clients need — from standard legal tasks to more complex, strategic issues requiring deeper expertise, especially in domains affected by GenAI. Additionally, clients now expect law firms to engage more collaboratively and creatively, addressing challenges tied to emerging technologies and regulations.
If law firm leaders should take anything away from this paper, it is the understanding that the ground really is shifting under them because of AI and GenAI and how those advanced technologies are fundamentally impacting the way legal work can be done in the future.
The Thomson Reuters Institute’s new “Clarity” podcast
The Thomson Reuters Institute has revamped, rebranded, and relaunched its podcast channel as “Clarity”, a perspective that will focus on the big questions facing professionals in the legal, corporate risk & compliance, government, and tax, audit & accounting industries. In our first episode, we ask what law leaders need to understand in order to be successful in 2025.
You can follow the Thomson Reuters Institute’s new Clarity podcast channel on YouTube here
