AI’s Transformational Promise in the Legal Sector
AI in law firms has become a central focus for leaders in the legal industry, as firms seek to maximize efficiency and demonstrate clear returns from their investment in new technologies. While discussions continue about the best approach to integrating AI and other digital tools, some law firms are rapidly advancing, determined to capture the benefits that AI in law firms can deliver.
One notable example is Ashurst. Since 2013, Ashurst has operated Ashurst Advance, an alternative legal services division designed to improve operational efficiency. According to Hilary Goodier, partner and global head of Ashurst Advance, the division now supports approximately two-thirds of the firm’s legal work. Ashurst’s digital delivery arm combines the expertise of lawyers, technologists, paralegals, and project managers across Australia, the Middle East, and Europe, leveraging the latest AI-powered legal platforms from industry innovators such as Harvey, Microsoft, and Relativity.
Real-World Applications of Legal AI
Generative AI is already making a significant impact. Last year, Ashurst Advance employed AI in law firms to assist a multinational retailer—whose identity remains confidential—in a major regulatory review in Australia. The technology enabled lawyers to sift through roughly 100,000 documents in just 48 hours, categorizing and formatting them for regulatory submission. This task, previously estimated to require two weeks, illustrates the dramatic efficiency gains made possible by AI in law firms.
As these results become more visible, software providers are actively targeting the legal sector with promises of transformative results using their AI-powered platforms. The market is dominated by a few key players, including new entrants like Harvey (US) and Legora (Sweden), as well as established vendors LexisNexis and Thomson Reuters. Recently, Anthropic has launched tailored AI tools for the legal sector, while OpenAI is also set to release legal-focused AI software, broadening the competitive landscape.
The Rise of Open Source and In-House AI Solutions
Open-source legal AI is reshaping the market, offering law firms the flexibility to build customized digital solutions. For instance, Mike OSS, developed by Will Chen—a former Latham & Watkins lawyer—uses Anthropic’s Claude AI and offers features comparable to those from Legora and Harvey. The proliferation of open-source and in-house AI models is notable in regions like Singapore and Hong Kong, where large firms are investing in proprietary large language models to power their own AI in law firms.
However, this rapid innovation brings new challenges. Brian Tang, executive director at the University of Hong Kong’s LITE Lab@HKU, emphasizes concerns over reliance on third-party technology and the potential risks to confidentiality. As Tang notes, “If you’re relying on somebody else’s technology and if the tap gets turned off, do you have a problem?”
Overcoming Internal Barriers to Adoption
Despite technological advancements, AI in law firms is not solely a technology challenge. Cultural and structural barriers persist. Michelle Mahoney, chief innovation officer at Mallesons, argues that “AI isn’t a technology issue to solve; it’s a people issue to solve.” Her firm has implemented a three-tier AI training system, progressively building employees’ knowledge and capability. Yet, measuring true return on investment (ROI) remains elusive, with metrics ranging from the development of new AI-based legal services to the automation of tasks that employees dislike.
Australian firm MinterEllison is also expanding its AI training initiatives. Virginia Briggs, the firm’s chief executive and managing partner, describes their approach as focusing on efficiency, quality, and creativity in leveraging AI in law firms.
Trust and the Client Relationship Shift
While access to AI in law firms is growing, trust in these technologies remains a hurdle. Chris DeConti, co-founder of legal services group Factor, cites data showing that although 83% of lawyers have access to AI, only 22% express high confidence in its output. This gap highlights the ongoing need for effective change management and education.
Legal tech spending is forecast to rise, with Gartner predicting that corporate legal departments could double their investment by 2028. Yet, both law firms and in-house departments must justify these expenditures by demonstrating clear, measurable gains.
Another significant shift is the blurring line between law firm and client technology capabilities. As clients gain access to the same AI tools as their legal advisors, the traditional relationship is set to evolve. As Tang observes, “The [law firm’s] client now says, ‘Hey, I have Harvey too, I can do this myself. So, what am I using you for?’” This democratization of technology may redefine how law firms deliver value in the years ahead.
The Future of AI in Law Firms
As the legal industry continues to embrace AI in law firms, the focus will increasingly shift to demonstrating tangible benefits, managing risk, and cultivating trust among professionals and clients alike. The journey toward full adoption is underway, but success will depend on a combination of technological innovation, strategic investment, and a people-first approach.
This article is inspired by content from Original Source. It has been rephrased for originality. Images are credited to the original source.