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AI legaltech startups are turning on the heads of the process-centric, traditional legal industry that was established in the past. These companies are using artificial intelligence (AI) to take some legal processes into auto-mode and enhance others, fundamentally changing the nature of practice and lawyers.

With the integration of AI technologies into legal workflows, the roles, skills, and areas of focus for lawyers start to change in some unprecedented ways.

The rise of AI legaltech startups

AI legaltech startups have come into the forefront with a host of innovations that automate tasks customarily done by lawyers. They are powered by technologies such as machine learning, NLP, and data analytics, which help with the creation of tools in a variety of segments such as legal research and contract analysis, due diligence, and compliance management, etc. In most cases, innovations in this direction increase efficiency, reduce costs, and add to the accuracy of legal work.

Indeed, the most astounding fact about AI legaltech is that it churns out reams of data at impervious speeds—unthinkable in earlier times. For instance, AI legal research tools that enhance the old keyword search in large legal databases seeking relevant case law and statutes significantly reduce the amount of time clients pay for. Likewise, contract analysis tools can automatically read through and parse legal documents for key clauses and hidden risks, thereby taking hours of work out of the process.

AI redefining traditional legal roles

The intervention of artificial intelligence in legal practice transforms the traditional role of lawyers in various ways:

1.    Automation of routine tasks: The first and most direct impact from AI legaltech startups is the automation of routine repetitive work. Document review, due diligence, and legal research are the typical areas rocked by AI tools. This shift in time use enables lawyers to focus much more on the activities requiring critical thinking, such as the formulation of legal arguments, counseling of clients, and development of case strategies.

2.    Better decision-making: Through data analytics, AI legaltech startups have offered tools to ensure better decision-making through appropriate data analytics. Predictive analytics help in scoring the potential results of litigation, for example, from past cases. This ability empowers attorneys to advise clients on the best course of action and manage their expectations. Access to this kind of data allows one to draw trends or patterns from case law that would be better suited for the making of legal strategies and advising the client with better quality counsel.

3.    Transforming into strategic advisors: With AI taking over most of the day-to-day drudgery that is legal work, lawyers are increasingly transforming into strategic advisors. Most of the administrative tasks diminish, and hence the lawyers come to be giving high-level advice concerning the legal and business arena. This transition can best be described in the field of corporate law, which expects lawyers to make out complex business environments and be able to deliver insights going beyond the basis of the law’s mere compliance. Such data, in addition, is further empowered by AI tools that analyse market trends, regulatory changes, and financial data to be used by lawyers to better advise their clients.

4.    Greater client focus: Automating the laborious jobs allows attorneys to spend more time developing and nurturing the client relationship. In people-driven industry, where trust and communication are key, the ability to interact with clients in greater detail is a great advantage. More personalised services can be offered to reach the client at their specific need, with more attention and responsiveness. This change is a catalyst for much-improved client satisfaction and long-term collaborative relationships.

5.    New skill-sets and expertise: Yet another major change taking place because of the proliferation of AI legaltech startups is that of a set of new skills for the legal profession. There is a rising demand for attorneys who are competent both in technology and data analysis. The skills in comprehending how best to utilise AI tools are now considered a skill, so are the skills in interpreting data analytics. Also, quickly becoming a critical need is familiarity with information security, data protection regulations, and technology legislations, attributed to the increasing pace of digital transformation. This shift in the bar raises about the prospect of what has been identified as the hybrid of legal practitioners who, on the one hand, possess the legal craft and on the other hand, have technical know-how.

Opportunities and challenges

While the benefits of AI legal tech are clear, the transition also presents challenges. One concern is that their excessive reliance on technology will make them lose some of the most essential legal skills, including critical thinking and judgment. The use of AI tools calls for lawyers to strike a balance in utilisation between core competencies. The other ethical concerns that need to be managed with care include data privacy as well as algorithmic bias for AI applications to be kept within the professional and ethical standards of the law.

A further problem arises with the likely effect on the legal job market. One worries that demand for some kinds of legal work will decrease as AI tools become capable of doing what has traditionally been done by a junior associate or a partner in a smaller firm. But AI, far from displacing workers, is more likely to shift the nature of legal work in ways that will create new opportunities for lawyers to specialize in areas where human judgment and creativity are necessary.

The future of the legal profession

As long as these AI legaltech startups continue to innovate, the legal profession is, beyond any doubt, further bound to change. Collaboration of lawyers with the assistance of AI systems will increasingly become the norm, and these systems will continue to be seen as their augmentation tools, not replacements for them. This way, the future of law seems to be a blend between human expertise and machine intelligence for a more efficient and effective approach to legal practice.

Legal practitioners under such a dynamic environment require lifelong learning too and adaptability. Keeping up with the trends and advancement in technologies will equip them for survival under such fast-changing environments. Infusion of AI in the legal space is far bigger than simple technological change; it is a sociocultural one that requires an entire reorientation in the delivery of professional legal services and of the value that lawyers offer their clients.

Finally, AI legaltech startups are giving leverage to lawyers to be more efficient at work, better decision-makers, and lay more emphasis on strategic advisory tasks that are valuable to the clients. Apart from the challenges that exist, the potential for AI in law is humongous, giving away big capabilities for greater efficiencies in a more accurate and smoother manner of service to the client. The best part can be taken by any future lawyer with the harnessed change in the area of legal technology.

(Anushita SP Karunakaram, Co-founder & CEO at Lawyer Desk)