In the rapidly evolving world of legal services, Isabel Parker stands at the forefront of digital transformation and innovation. As a Partner in Deloitte Legal’s Legal Management Consulting team, Isabel leverages her experience to help corporate legal departments and law firms navigate the complexities of modern technology. With a background that spans international legal practice and a pioneering role in legal innovation at a prestigious magic circle firm, Isabel’s insights are shaping the future of the legal industry.
Saxton Bampfylde Consultant, Kate Ludlow, and Senior Advisor, Philip Rodney, talk to Isabel who shares her journey, her vision for the future of legal services, and the pivotal role that technology, particularly AI, will play in redefining how law firms operate.
Isabel, tell us about what got you interested in the digital transformation of law firms.
I took a career break after having my three kids. When I came back to Freshfields, the then global managing partner, Ted Burke, had just launched a strategic review of the firm, and he asked me to get involved. It was an exciting project, involving a root and branch review of the firm’s resourcing, metrics, and global client service delivery. So I grabbed the opportunity and became the leader of that project.
The project involved reviewing all the firm’s processes and the technology used to support them, and a review of how our lawyers worked and how we could deliver more value to our clients globally. As part of the process, I got very interested in technology and how it could really augment the way that lawyers deliver.
What exactly is the offering that Deloitte Legal provides?
Deloitte Legal is a very different kind of law firm. We don’t just provide the traditional legal advisory services you’d expect. Rather, we focus on finding the best way to solve clients’ problems using a combination of legal expertise and Deloitte’s transformation and technology capabilities.
I am a partner in Deloitte Legal’s legal management consultancy team, that works alongside our advisory lawyers. In that role, I help corporate legal departments and law firms to digitally transform, by reviewing their operating models, supporting strategy development and advising on the use of technology (including, increasingly, generative AI).
Finally, we are providers of managed legal services. The teams work together, combining the resources to build solutions for our clients.
Gates’ law states that “Most people overestimate what they can achieve in a year and underestimate what they can achieve in ten years.” With that in mind, how do you think that the delivery of legal services will differ in 2034? Given that it may be a ten year journey, where should firms start now?
These are big questions. I agree with the premise and am certain there will be significant change in how legal services are delivered. Generative AI will play a huge role in transforming how legal services are delivered, alongside other digital technologies, such as quantum computing, VR – and who knows what else. I’m definitely not a futurist – that’s not my role. Rather, I’m a pragmatist. So I wouldn’t give you one version of the truth. Let me set out three possible scenarios.
At one end of the spectrum, we might find that it is all just hype and that we are expecting more than can be delivered from this technology. In that scenario AI won’t create new kinds of services. It will just be used around the edges to deliver incremental efficiency gains for process based work.
In the second scenario, Gen AI has been fully integrated into the delivery of legal services. This scenario becomes more interesting: in addition to efficiency gains, AI will help to unlock the unstructured data that sits in documents and contracts, allowing lawyers to derive new insights and to create new kinds of legal services. One consequence of this could be that lawyers move away from “fighting fires”, towards proactively preventing them happening in the first place. So, for example, you could use Gen AI to examine litigation outcomes, work out the causes of the dispute and fix them upstream, so as to stop a recurrence. That would really change the business model.
The third – and the most extreme – scenario is that we have taken a huge quantum leap and have achieved artificial general intelligence (AGI), which can deliver everything that humans do at present, to the same standard or better. In that event, law firms might no longer be selling their services in the traditional way at all, but rather using AI to productise their services, licensing content and knowledge using systems rather than people.
I think that the second scenario is the most likely. The second part of your question was what should law firms be doing now? Putting Generative AI into the hands of the lawyers and getting them to experiment with it is really important as is setting up the governance structures to use it responsibly and effectively. Law firms also need to evaluate and test the risks and create the guardrails to enable AI to be imported safely into their environment.
Data is going to become even more valuable. Law firms need to be thinking about how to clean up and organise their data to ensure they can extract the very best value from an investment in AI, There are people implications, too: law firms should consider AI in their strategic planning, by assessing the likely implications on their workforce together with the skills mix, training and resource requirements that will be needed to support AI-augmented client service delivery.
The law firm apprentice model is likely to change. As law firm knowledge becomes productised through the use of AI, juniors will actively learn from the technology, much in the way that they learned from their bosses in the past. But there will also be a need for relationship led learning – how to influence, negotiate and win clients – and it is likely that this learning will continue to be delivered by senior lawyers.
Law firms generally still follow a variation of the ‘Master, Journeyman, Apprentice’ model. Will that model change? What will the structure of law firms look like?
I doubt that the high quality, deep expertise and human judgement that the very best lawyers exercise will ever be replaced. So whatever structure you end up with, you’re still going to have a layer of deep human expertise. However, this layer is likely to be thinner, with fewer, highly specialised, senior lawyers. This would have implications for the traditional law firm leverage model – it is conceivable that the shape of the traditional law firm will become very different.
Part of the reason that law firms are expensive is that the infrastructure that supports the lawyers is relatively large when compared to other industries. In other sectors, including other professional services organisations, AI is being applied in HR, marketing, business development, finance and other business support functions to drive efficiencies and streamline delivery. The technology really can do many, many things that we thought only humans could do before. Law firms may look to apply Generative AI to their support functions as well as to their client service delivery, resulting in a leaner back office infrastructure.
The cost of entry to the legal profession is becoming ever more costly, with increased regulation and the investment required in technology. Will there be opportunities for new entrants who can do something completely different? If you were designing a new law firm from scratch, what would it look like?
I’m not sure I agree that the cost of entry is going up. In my mind, it should actually be going down because there is less infrastructure required in terms of people than at any time in history. AI should enable practitioners to do a lot themselves and increase their personal and professional productivity. So as the use of technology increases and legal services become more productised, the opportunity for new entrants should actually increase. Expertise will be democratised and baked into workflows and solutions. As an example, we should be able look at a body of documents very quickly and get a point of view. On the other hand, complex legal reasoning is less likely to be easily disrupted.
Would I build a law firm from scratch in the current environment? That’s a really tricky question. Perhaps instead, I might just create a web of brilliant sole practitioners, each with a very high EQ, who are effective at building relationships, and combine that with lawyers who know how to work with data and can pick up technology solutions quickly.
Isabel Parker, Partner, Deloitte Legal
Isabel is a partner in Deloitte Legal’s, Legal Management Consulting team, working with corporate legal departments to design and deliver solutions to their business challenges.
She studied English Literature at Cambridge. After graduating, she qualified as a lawyer in England and Wales as well as at the New York Bar. She practiced at magic circle firm, Freshfields Bruckhaus Deringer as a finance and corporate transactions lawyer spending time in Paris and being part of the team that set up the New York office. Isabel latterly performed the role of Chief Legal Innovation Officer at Freshfields.