Elevating Legal Operations to the Status of Legal Advice: A 2024 Update

By: Lourdes M. Fuentes

"A corporation is a living organism; it has to continue to shed its skin. Methods have to change. Focus has to change. Values have to change. The sum total of those changes is transformation." ~Andrew Grove

Introduction

In 2022, I authored an article titled "Elevating Legal Operations to the Status of Legal Advice," which was published in the University of Pennsylvania Future of the Profession Initiative newsletter. The piece explored the critical role of legal operations (legal ops) in driving digital transformation within the legal industry. At that time, the focus was on adapting to new technologies, managing the exponential growth of data, and the importance of upskilling legal professionals.

As we step into 2024, the landscape has evolved, primarily due to the rapid adoption of Generative AI (GenAI) and Large Language Models (LLMs). These technologies are not just enhancements; they represent a fundamental shift in how legal services are delivered and managed. This update revisits the key points from my original article, integrating the profound impact that GenAI and LLMs are having on legal technology and operations, while also addressing the new challenges they present.

For a preview, my conclusion is this: "the more things change, the more they stay the same."

Why is Legal Ops More Crucial Today?

In 2022, I argued that legal operations should hold equal status to legal advice, a point that is even more pertinent today with the rise of GenAI. Let’s revisit the reasons why:

1. Digital Transformation and GenAI Integration: The Fourth Industrial Revolution continues to drive the legal industry's digital transformation. However, GenAI has supercharged this process, enabling unprecedented automation, data analysis, and predictive capabilities. Legal ops teams are now tasked with not only managing this transformation but also harnessing GenAI to enhance legal service delivery.

2. Enhanced Legal Advice: In my original article, I emphasized the need for lawyers to handle data and technology effectively. Today, LLMs can assist with legal research, document drafting, and strategic decision-making, allowing lawyers to focus on higher-order tasks that require human judgment and expertise.

3. Compliance and Ethical Duties: The ethical responsibilities of legal professionals remain a cornerstone of practice. GenAI can support these duties by flagging risks, ensuring compliance, and maintaining the integrity of legal processes, thus becoming an indispensable tool for legal ops teams.

4. Focus on Core Competencies: The argument that top legal practitioners should focus on practicing law while leaving operational tasks to experts is even stronger today. With GenAI, legal ops teams can take on more complex tasks, providing critical support that allows lawyers to concentrate on what they do best.

What Do We Mean by Legal Ops in 2024?

In 2022, I defined legal operations as more than just deploying technology—it’s about having a team of experts who understand the intersection of law, business, and technology. This definition holds true today, but with the integration of GenAI, the scope and impact of legal ops have expanded.

Legal ops now involves not only managing traditional tasks like contract lifecycle management, data governance, and project management but also deploying and optimizing GenAI tools. These tools can automate routine tasks, generate insights from large datasets, and provide real-time analytics that inform strategic decisions.

The Role of GenAI in Modern Legal Ops

As we update our understanding of legal ops, it’s impossible to ignore the transformative power of GenAI:

- Upskilling Legal Professionals: The need to continuously upskill legal teams remains, but the focus has shifted. Now, legal ops teams must ensure that lawyers and support staff are trained in using GenAI tools effectively, turning these technologies into competitive advantages.

- Process Redesign: Continuous process improvement was a key theme in 2022, and it remains so today. However, GenAI enables more efficient workflows through automation and smart analytics, pushing the boundaries of what’s possible in legal operations.

- Technology Deployment: The selection and deployment of the right technology remain critical. In 2024, this means choosing GenAI tools that align with the specific needs of the legal team, optimizing both cost and impact.

The Challenges of GenAI in Legal Ops

While GenAI offers remarkable opportunities, it also presents new challenges that legal operations must navigate carefully:

1. Data Privacy and Security: As GenAI tools become more integrated into legal workflows, the amount of sensitive data being processed by these systems increases. Ensuring that these tools comply with data privacy regulations and safeguarding client confidentiality is paramount. Legal ops teams must be vigilant in assessing the security measures of any GenAI tool and maintaining robust data governance frameworks.

2. Ethical Considerations: The use of GenAI raises ethical questions, particularly around the potential for bias in AI-generated outputs. Legal ops teams must work closely with developers and IT professionals to ensure that AI systems are trained on diverse, representative data sets and that their use is transparent and accountable. Additionally, there must be clear guidelines on how much reliance can be placed on AI-generated advice versus human judgment.

3. Change Management: Integrating GenAI into existing legal operations can be met with resistance from legal professionals who may be skeptical of or uncomfortable with new technologies. Effective change management strategies are essential to foster adoption, build trust, and ensure that all stakeholders understand the benefits and limitations of GenAI tools.

4. Regulatory Compliance: As regulators become more aware of AI's role in legal processes, new compliance requirements may emerge. Legal ops teams must stay ahead of regulatory changes, ensuring that their use of GenAI aligns with evolving legal standards and industry best practices.

5. Balancing Automation and Human Expertise: While GenAI can automate many tasks, it’s crucial to strike a balance between automation and the need for human expertise. Legal ops teams must be strategic in determining which tasks are appropriate for AI automation and which require the nuanced understanding and ethical considerations that only human professionals can provide.

Recommendations for Law Firms: Embracing Legal Operations Regardless of Size

Whether you’re leading a small boutique firm or a large multinational law firm, the importance of a well-structured legal operations team cannot be overstated. Here are key recommendations for law firms of all sizes:

1. Start Small but Think Big: For smaller firms, the idea of building a full-scale legal operations team may seem daunting. Start by identifying key areas where legal ops can make the most immediate impact, such as billing, contract management, or client communications. As these processes improve, gradually expand your legal ops capabilities.

2. Invest in Training and Development: Regardless of firm size, ongoing training is crucial. Equip your lawyers and support staff with the skills they need to leverage GenAI and other technologies effectively. This investment will pay dividends in the form of increased efficiency, better client outcomes, and a more competitive firm.

3. Leverage Technology Wisely: The right technology can level the playing field between small and large firms. Invest in scalable GenAI tools that can grow with your firm. Ensure that these tools are integrated into your workflows in a way that enhances, rather than disrupts, your practice.

4. Focus on Client-Centric Solutions: Legal operations is not just about internal efficiencies; it’s about delivering better service to clients. Use GenAI and legal ops strategies to create more transparent, efficient, and cost-effective legal services. This focus on client satisfaction will differentiate your firm in a competitive market.

5. Prioritize Collaboration: Legal operations thrives on collaboration between lawyers, IT professionals, and business experts. Foster a culture where these teams work together to solve problems and innovate. For smaller firms, this might mean engaging external consultants or forming strategic partnerships to bring in the necessary expertise.

6. Maintain Agility and Flexibility: The legal landscape is constantly evolving, and so should your approach to legal operations. Regularly review and adjust your legal ops strategies to ensure they align with the latest technologies and industry best practices. Smaller firms, in particular, have the advantage of being more agile, allowing for quicker adaptation to change.

The Future of Legal Ops with GenAI

As we move forward, the future of legal operations will be shaped by our ability to adapt to and harness the capabilities of GenAI. The profession is on the right track, but the pace of change demands vigilance and adaptability. Law schools, CLE programs, and industry leaders must continue to prioritize training and development in these new technologies to prepare the next generation of legal professionals.

In conclusion, while the tools have evolved since my original article in 2022, the core principles of effective legal operations remain the same. By embracing GenAI, addressing its challenges, and integrating it thoughtfully into our operations, we can elevate legal ops to new heights, ensuring that our firms and departments are not just surviving but thriving in this new era.