Large firms playing the pioneering role

It is this reservation among companies regarding technological advancements that is reinforcing many German midsized firms’ conviction that digitalization will not affect them in the long term. Lots of large commercial law firms, on the other hand, have jumped on the bandwagon: they are creating jobs on the interface with legal tech, e.g. in litigation management. Positions are also being established at partner level and in business development. Some firms are supporting startups to raise their competitiveness, as the use of state-of-the-art technology is a factor in some beauty contests, e.g. BASF.

But so far few general counsel are asking law firms about this. More than half of the participants of the latest JUVE in-house survey answered the question of what they know about their firms’ use of IT with “I don’t care.” This is dangerous. If clients block out the savings that firms are making thanks to legal tech tools, e.g. in due diligence work, they will be unable to assess what is possible in price negotiations.

There is considerable IT potential left unexploited for performing the standardized tasks that many legal departments would love to be rid of to create capacities for more important things: Linklaters, DLA Piper, Clifford Chance, Freshfields Bruckhaus Deringer, as well as Germany’s largest firm CMS Hasche Sigle, recently made huge investments in artificial intelligence software for automatic document analysis. This allows them to deal with standardized checking processes at the push of a button, something which used to keep whole teams busy. The program’s error rate is already lower than that of humans. Very soon it will be possible to use this in all legal fields. Although the use of legal tech has yet to impact law firms’ hiring figures, the software will change firms’ staff policies massively worldwide.

Find out why digitalization is mainly affecting Mittelstand firms

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