Reconfiguring law firm management with automation and emerging tech

Emerging technology is driving significant changes in the legal profession. Artificial intelligence (AI), cloud-based software and legal technology have transitioned from optional tools to essential resources that increase efficiency, improve accuracy and benefit client outcomes.

According to the most recent American Bar Association (ABA) "Legal Technology Survey Report" in 2024, 73% of firms now rely on cloud-based tools. Furthermore, 30% of respondents reported using AI technology, marking a 19% increase from 2023.

Beyond being mere statistics, these developments point to something deeper: a transformation in how law itself is practiced. In this article, we will discuss why legal leaders should seek AI tools and emerging technology to enhance productivity, how they can change the power structure of a firm and ethical guidelines to consider.

Automation and tech: Thoughtfully lean in (now)

Some lawyers still question the value of these technologies, expressing concerns about ethical considerations and complexity. While a healthy skepticism is expected for any emerging technology, don't write this one off -- especially since ABA information indicates that your competition is embracing it.

Many plaintiff firms work on contingency, which is why they concurrently handle anywhere from dozens to hundreds of cases at a time. Each has its own set of rules and procedures, as well as medical records, discovery demands and deadlines. Though this has historically meant sifting through boxes upon boxes of paper records (which still happens), an equally immense task has been searching through digital files and data. For example, many health care providers digitize all their charts, scans and summaries, which means countless gigabytes of information need to be safely and securely transferred between a doctor's office and an attorney.

With rising litigation costs and narrowing profit margins, operational efficiency is a necessity. AI-powered tools speed up case intake, automate tedious discovery and document review, and deliver smarter, data-driven demand letters and valuations. These technologies sharpen trial prep, offer deeper jury insights, and boost client communication and conversion rates -- helping firms work faster, smarter and more competitively.

Challenging billable hours and traditional power structures

The growing capabilities of legal technology frequently clash with entrenched aspects of law firm culture.

One of the most obvious struggles lies between efficiency and billable hours. When new tools reduce the time required for legal tasks, but compensation systems remain tied to time spent, a fundamental imbalance occurs.

Similarly, cloud-based collaboration tools are democratizing access to information in ways that challenge hierarchical structures. When junior associates can track real-time project progress and engage directly with decision-makers, traditional power dynamics begin to shift.

Most clients will expect you to use AI- and cloud-based tools. They might even demand it as a means to speed up their claim. Depending on how you pay your associates, they may not be incentivized to adopt a tool that would reduce logged time. Furthermore, if they have ideas on enhancing efficiency but are ignored, they will either stay silent, or worse -- go elsewhere. The truly forward-thinking law firms will find a middle ground that incorporates some legacy methods, rather than reverting to them outright in an effort to look busy.

Several firm leaders have expressed uncertainty about how to reconcile these opposing forces. AI can boost speed and productivity by analyzing data quickly, identifying patterns and automating repetitive tasks.

However, there are key characteristics it still lacks, even in 2025. For example, it cannot:

• Substitute human judgement

• Function flawlessly (it is still learning, and is not completely accurate)

• Run independently

• Find the gaps in efficiency, like those listed above, and create new responsibilities within your firm. Stress to the lawyers that this is not an IT-based function, since you are dealing with quality assurance and legal accuracy. 

On ethics and compliance

Using a lack of clear guidance as a reason to avoid some automation and technology would be a cop out. All law firms should look to the ABA for guidance on the ethical use and implementation of AI and legaltech in their operations. In 2023, the ABA issued Resolution 604, which highlights the need for AI to remain under human control and oversight at all times. It provided a framework for ethical AI adoption.

Verification: Always review AI-generated content to prevent hallucinations or inaccuracies.

Transparency: Disclose AI use to clients and explain benefits and limitations.

Security: Use tools with enterprise-grade encryption and secure data storage.

Augmentation: AI should support, not replace, attorney judgment.

California is the epicenter of tech and software development in the United States, so it's unsurprising that the State Bar is a leader in AI ethics and compliance. The California State Bar has stood out (though some might say it is splitting hairs just a bit) by referring to its codes as a "guiding principle," in contrast to "best practices."

For example, Duty of Confidentiality Bus. & Prof. Code § 6068, subd. (e), Rule 1.6 and Rule 1.8.2. states:

"A lawyer must not input any confidential information of the client into any generative AI solution that lacks adequate confidentiality and security protections. A lawyer must anonymize client information and avoid entering details that can be used to identify the client."

The California Rules of Professional Conduct details the penalties for breaching confidentiality or failing to take risk mitigation measures. By informing your clients about the firm's use of AI and developing an acceptable use policy for your staff, you will have managed expectations for both sides.

Emerging best practices

The technology law firm leadership adopts needs to pair well with the firm's culture and strategic goals. Its implementation should be gradual and come with ample training; according to Thomson Reuters' 2020 "Report on Legal Tech Adoption," 70% of law firm technology failures are due to inadequate training and buy-in.

Law firms navigating this transition successfully often share several key strategies:

Revising incentive structures: Moving beyond billable hours to include efficiency bonuses, client satisfaction metrics, and profitability benchmarks that reward value over time.

Prioritizing change management: Recognizing that technology adoption is as much about people as it is about software. Effective firms invest in training, support and cultural adaptation efforts.

Leveraging firm-specific data: Making decisions based on internal performance analytics, rather than relying on industry assumptions or tradition.

Accept that mistakes will happen, just as with nearly any new software program installed through the years. But with a clear vision and true commitment, you can quickly learn and move forward.

In the next installment, we'll explore the practical
applications of emerging tech and automation, compare some leading programs and
software, and provide tips for their use.   /o:p