This is a live blog post of Building the Exponential Law Firm. Rohit Talwar, a futurist, is the presenter.
I am posting live from Lexpo 2017, a legal innovation event in Amsterdam on May 8-9, 2017. I post as a session ends, so please forgive any typos or errors in my understanding. The session description appears at the end.
The money will be in new ventures. Big corporates have $6T (trillion) in funds to spend on new businesses. It will be invested in the next generation of businesses and start-ups. Those new businesses need legal services – and don’t have lawyers. The new businesses choose a firm that understands their business and that can pivot was the start-up pivots. And that can help companies that fit into current legal sysrtems change those systems.
Doubling revenue in three years is the goal – exponential growth. “Future Proofed” organizations focus on operational excellence in next year, on search for 12 to 36 months, and for 4+ years, understand future drivers. The latter two requires doing enough experiments to understand where growth comes from. Doing this also requires having managers who understand future business models and are not mired in current business models. And having sales people who understand the new service and understand the buyers of those new services.
In thinking about and planning for the future, recognize that there are rational and emotional responses to the future. Some lawyers don’t want to buy into future states because they will lose power or status. Rohit frequently gives out the web address of a therapist. Old ways of thinking and emotions hold us back from the future.
The analog (old) world is colliding with the new digital future. Digital thinking is now affecting the physical world. For example, building managers and water companies increasingly view themselves as data-based.
Companies have an evolving expectation of what law department should do and be. GC has to evolve to CLO. They need system thinking, take an ecosystem approach, grow investment in tech, and prove innovation capacity. Some corporates are now sending “mystery shoppers” to law firms to see their innovation centers. Some clients want law firms creating business opportunities that generate revenue of 50% of legal fees after two years.
More than half of the $120T economy in 2025 will be from businesses that don’t exist today. Law firms have big opportunity to get in on the ground floor with these businesses to be. Law firms have to eliminate old ways of thinking to do this.
Many technologies will drive the new economy: 3D printing, nanotech, AI, new computing architecture, immersive / mixed really living, blockchain, synthetic biology, and human augmentation. New businesses rely more on ecosystems of partners and have much more revenue per employee. Fast businesses can construct new buildings or cars faster than lawyers can write the related contracts.
Companies that give themselves permission to think about the future the right way have huge returns: Google, Uber, Airbnb, etc.
AI will be transformative. Big turning point is when Google AI beat world Go champion. The current limitation is that AI systems only learn one deep area at a time. But coming soon is general human intelligence. Cites as example a Big 4 that has developed a tax advisory system that provides better advice than professional with five years of expense.
Legal sectors use of AI: machine learning for contracts, doc review, ROSS for research, and predicting courts and judges. In-house examples include Riverview Law KIM, Hive Legal Super App, and Next Angels.
Clients want to automate any high volume legal work. The opportunity is in new areas of law and the “front end” of strategic advice in these areas.
Law firms are now delivering advice and services over the web. Examples: Casehub for Ryanair class action passenger fee lawsuit, crowdjustice, UK first robot lawyer, and Rechtwijzer.
Blockchain eliminates central clearing mechanisms. Ethereum is the big platform now for blockchain.
In the next 18 months… more and more experiments in legal. In three years, lawyers to be replaced by AI, blockchain widely used, apps replace lawyers. Next five years: dramatic change in the way the market works.
Severn models of exponential law firms in 2025: 1) Hothouse lawyers, mainlyAI and few lawyers. 2) Algocracy: law built into infrastructure. 3) Smart and Distributed: firms that service blockchain and distributed autonomous organizations (DA). 4) Anti-Law Firm – online, open, and cheap. 5) Cyber Guardians: firm that monitors lives and your data constantly . 6) AI Bodyguard: embedded into all systems and processes to figure out law and issues and keeps owners legal. 7) A Very Human Law: small law firms that advise the rich and famous and folks who want to keep things discrete.
To get to future, firms must set ideas free. Do a lot of experiments. See what works. Go after new industries and new developments in old industries. Driverless cars. Brick-laying robots. Self-Owning assets. Another area is human enhancement: implants, new drugs, artificial blood, bionic liver machine, CRISPR-cas9. Much work required to define legal, ris, and insurance frameworks for these developments. Another example: who gets patent when AI discovers new drug.
So how do we create a very human exponential business? Humans should stop thinking like machines, citing United Airlines, where all the humans followed rulebook.
Latham is putting all their partners through Singularity University to better train them on how to think about the future.
Cites Gandhi: go from being ignored, to being laughed at, to fighting, then winning. Go from fear of future to embracing it.
“Unlocking the exponential growth opportunity presented by AI, emerging technologies and disruptive thinking
The legal sector is dipping it’s toes in the water with AI and other emerging technologies. Global future thinker and legal sector futurist Rohit Talwar will explain how commercial and business sector law firms can tap into the ‘once in a lifetime’ market opportunity as these new technologies transform every industry within a Tn global economy.”