Investing in Legal Department Innovation: The Case for AI-Enabled In-House Solutiutions
In preparation for our upcoming webinar, a conversation has been taking place regarding investment in legal department innovation. The premise is simple: the department’s budget has increased, and the general counsel must decide how to best use the extra cash to foster long-lasting innovation, with the two final options being 1. Invest in AI enabled services; or 2. Invest in an ALSP engagement.
In order to start the buying process to achieve the most meaningful results, it is important for general counsel and legal department operations personnel to first address their workflow bottlenecks and process pain points from the perspective of the business units they work most closely with. Once the department identifies the key workflow deficiencies as stated by their clients, it can start building solutions for those problems.
Before assessing whether your department should look for ALSPs or AI, it is important to note that we are assuming every ALSP that legal departments consider for engagement use tech-enabled processes. At the end of the day, any ALSP purchased by the legal department should understand the best technology for the tasks at hand, and their service model should reflect how the process drives value. The following are a few indicators that updating your legal processes to AI or automation-enabled services would be a more worthwhile investment than engaging an ALSP:
1. The data being processed during the engagement is too sensitive for outside services. In this use case, this data could raise privacy concerns for the organization if it were to be handled by outsourced services, as it could outline greater value or greater risk from within the organization.
2. Your department is addressing a pain point with a high-risk profile. For this use case, think of the example of a matter portfolio worth $60 million in business. If the goal of that matter portfolio is to tackle it most efficiently, an ALSP is more apt for completing work at a value. If the legal department believes that the $60 million portfolio has the potential of costing the company substantially more because of poor regulatory compliance or less attention to detail, there is much to be lost from outsourcing said portfolio.
3. Your staffing model/budget allows for the IT support and headcount needed to effectively use your automated solution. One of the most difficult aspects of implementing automated technology is the prospect of system maintenance. Secondary to that, ensuring there is enough budget left to hire the personnel needed to run the system is key. If the department meets those requirements, inside personnel could foster process improvements to drive value without the need for outsourcing.
If your company assesses workflow deficiencies and finds these elements of their process to be key, keeping your work in house and implementing AI and automation-enabled services would be the more worthwhile investment. The biggest advantage to keeping this work in-house is the opportunity to find more value from your legal process data and from other business units internally.
If you’d like to join our discussion on this subject, our third installment in our ALSPs series is approaching on 8/12. Register here!