The adoption of Artificial Intelligence (AI) by legal departments is being compared to its adoption by other corporate departments
Prestigious consulting firm, Bain & Company is ‘shaming’ legal departments for being tech laggards:
.. legal is lagging some other corporate functions in this regard. Only 20% to 25% of legal departments use AI in at least one area, according to a LexisNexis survey of legal departments, compared with 40% in finance and 54% in human resources, recent Bain & Company surveys found. And looking two years out, finance and HR expect to adopt AI much more aggressively than legal. That’s consistent with new research by Gartner, which found that 8 in 10 corporate legal departments are unprepared to support their organizations’ digital initiatives.
Bain & Company further points out the huge gains made by legal departments that have embraced AI:
JPMorgan Chase’s legal team, for instance, used to review commercial loan agreements manually. Starting in 2017, JPMorgan built Coin (Contract Intelligence), an AI engine to automate legal work that cut up to 360,000 hours of agreement review by lawyers and loan officers each year. Now, the company is rolling out Coin on other complex legal processes, such as reviewing credit default swaps and custody agreements.
At Coca-Cola, AI-based tools have sped up contract drafting and reduced the amount of time that lawyers had been spending on review. Coca-Cola launched a self-service portal that reduced contract-drafting time for many matters from up to 10 hours to around 15 minutes. These tools also reduce risk and improve efficiency by creating consistency in agreements—and they free up the legal team to focus on more strategic and value-added work.