Law Firm Shake-Ups to be led by Artificial Intelligence: latest BDO Survey
29 May 2017
The global legal profession is facing a seismic shift with technology set to have the greatest impact on law firms over the next five years, according to a new report published by accountancy and business advisory firm BDO.
The second BDO Law Firm Leadership Survey, which polled the managing partners and senior partners of 50 leading law firms, found more than 80% of participants pointed to technology as the factor most likely to have the greatest impact on their firm.
1 in 5 respondents said that expected Artificial Intelligence (AI) would have the greatest impact with many believing it would replace the work of lawyers, or strip out a significant layer of work and revenue from law firms. This will in turn bring about changes to their resourcing mix, business models and financial structures at law firms.
Tony Young, Professional Service Partner at BDO Australia said Law firm leaders are agreed that the pace of change in the legal industry is accelerating.
“One of the key challenges of technology today is how to fund the investment in technology, in the partnership model, in order to keep up to date with the competition,” Mr Young said.
“We are seeing several pioneering solutions entering the market, for example most large law firms in Australia have moved to implement new technology such as bespoke client portals and hubs. Those firms who have yet to respond are just waiting to see what the competition is doing. It is a challenge that these firms can overcome and benefit from, but they must be open to explore and understand the impacts. ”
“Being a ‘fast-follower’ is potentially seen to be a strategically smarter move than investing large capital in new technology while the market is still trying to understand the changing client demands.”
“The survey was undertaken in the UK but a number of the firms surveyed have offices and affiliates in Australia so the findings are just as relevant to our market.”
When asked what the greatest challenge their firms face in keeping up with the pace of technological change, just under half (49%) said that cultural change is the biggest barrier to innovation.
This combines 29% who said that cultural change across the firm was the greatest challenge, with 20% who thought cultural change amongst the partnership was more specifically the issue.