Legal firms already have most of the technology they need to work better, so why aren’t they using it?

If you are one of the roughly 200,000 people getting a divorce in England and Wales this year, you know how painful and stressful the ordeal can be. As well as deciding who gets what, you might have to look for somewhere to live, and there could also be children and maintenance payments to consider. That, alone, can be an emotional minefield. Then there is the legal process, which is far from easy. Solicitors (who significantly add to the costs) hold all the knowledge and most of the power in these situations – very few people attempt to get a divorce or buy a house without some degree of professional legal advice. Lucy Bassli, an Assistant General Counsel at Microsoft, believes the sector is ripe to be dragged into the 21st century. In her words, law is a “closed” business that’s too complicated and desperately needs to be democratized, handing the power to the people who just want to get divorced, for example, and close a tragic chapter in their lives. It’s hard to disagree when you look at the costly and lengthy process you have to go through to legally separate from a partner in most of the UK. Adding to the stress, there is a completely different process if you live in Scotland or Northern Ireland, or your partner “lacks the mental capacity” to agree to a divorce. Bassli is here to help. She believes the law “was created by lawyers and for lawyers” and the public has no choice but to hire legal professionals. That has to change, she says. “Lawyers will say: ‘We’ll help you, what do you need? For several hundred dollars an hour I will help you accomplish that task’. That is the legal sector right now. We need to change that.

“People can’t get basic things done because we have created a closed system that says you can’t get those things done without going through a lawyer. If you need a divorce, a sad and unfortunate reality that happens, it needs a legal proceeding. People have to pay a toll, basically, to help them go through one of the most disturbing and challenging parts of their life, and it costs a ton of money to file a few papers. “There’s also another, higher calling here for digitally transforming the legal sector – access to justice.” It’s a big aim for someone who started out at Microsoft as a “regular lawyer”, in Bassli’s own words, but now has a big remit. The 42-year-old was born in Odessa, Ukraine, and moved to the US with her family when she was five – first to New Orleans and then Houston. She graduated from the University of Houston with a degree in Russian Studies and Political Science, before earning her Juris Doctor degree. After law school Bassli swapped the heat of Texas for the unpredictable weather of Seattle, where she joined a small bankruptcy law firm. She was later recruited by the big firm Davis Wright Tremaine, before learning about an opening at Microsoft. That was 12 years ago. Bassli is now sat in Microsoft’s London office after flying over from the company’s headquarters in Redmond. She is passionately talking about the legal sector, data, analytics, contracts, diversity and GDPR, to name a few topics, just hours after meeting firms in the UK and speaking at an event in the capital. Her busy schedule is testament to how much her role has grown since she joined Microsoft in 2004. An expert in spotting efficiencies and automation, she now uses technology to help lawyers think about how they can get their job done quicker and easier. “I realised I loved the ‘how’ more than I loved doing the deals,” she says.

Data is like a drug to lawyers – they don’t know how much they love it until they get a taste of it, and suddenly they want more

While admitting the legal sector is “very paper-based and form-driven” – in the US you have to punch holes in court documents in a certain way or they won’t be accepted – Bassli also believes those who work in the sector are ready for change; they just need to be shown that data can transform their world. “Data is like a drug to lawyers – they don’t know how much they love it until they get a taste of it, and suddenly they want more. But another thing they don’t know is that they are sitting on a mountain of the stuff.” Here’s the problem: data is useless without someone to turn it into something that can be used. That takes cutting-edge technology such as AI and machine learning, which is often outside a lawyer’s comfort zone. Research earlier this year by Microsoft and online magazine Legal Week found that lawyers are struggling to work to their full potential because their firms fail to give them the right technology. More than 86% of those surveyed said they still used a pen and paper to complete legal work, and half said their firm had “not satisfactorily adapted to any technological changes that may have been adopted over the past few years”. Bassli sighs and nods as though she has seen this scenario many times. “Throwing a bunch of data at an attorney is not going to get you where you want to go.” The solution? Law firms need to hire people who aren’t lawyers.

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• Read Microsoft’s latest Digital Transformation report

“Lawyers need to be sitting next to business analysts who can translate between the business, which is the legal practice, and the data, and transform that into operational processes and start seeing the connections between what you can change to get a different output. That’s business analytics and data analytics,” Bassli says. “I had a meeting with a law firm recently and I was shocked that they have a team of about a couple of dozen people in their knowledge and innovation team and half of them are data scientists. These guys are poster kids. That’s where legal is starting to slowly head. We can help them, too, because they are already familiar with Microsoft; they live in Office and Outlook. But what else? Power BI is a perfect example – it’s in the Office suite. It probably won’t be used by lawyers yet, they’re not going to handle that, but they will have all these other professionals around them who can probably turn data into something visually appealing and consumable. Suddenly, you’re making decisions based on a colourful pie chart full of information, not anecdotal conversations.” Using AI and machine learning to analyse large amounts of data is already happening in the financial, healthcare and transport sectors, among others. While these areas of the economy are well into their digital transformation journey, the legal sector is still at base camp, by comparison. However, as Bassli says, that is slowly changing, and Microsoft is helping. Legal firms can take baby steps by using programs they already own in Office. They already use Word for drafting documents and Outlook to send emails, but there are tons of other programs just waiting to be explored – Power BI for metrics, SharePoint for creating an internal website, or OneNote for collaboration. “We want to be that honest technical provider; that really does differentiate us in many ways. The way we approach security and data privacy is: “we are the good guys”. Firms have all these things at their fingertips that Microsoft is already selling as wonderful productivity solutions but they are also a way to push the legal industry forward. It’s not a legal domain play, it’s just saying: ‘You already have it, use it better, use all the buttons’. “Part of my job is to talk to them and say ‘optimise this first; lawyer to lawyer, you will be more effective and efficient if you just optimise these couple of things’. Then they can go deeper and get some of their technical friends involved if they want, and get business analysts involved. They’ll use Power BI and get addicted to it. There’s all these things they already have that we just need to show people how to use better. Microsoft is not just looking at the sale, we are looking at the long relationship. You’ve bought something, how is implementation going, how much are you consuming? We are here to help you.” International law firm Herbert Smith Freehills is one company in the sector that is experimenting with AI, mainly in commercial transactions. In a video blog, Chief Executive Mark Rigotti warned there is a risk of being “left behind” if companies do not embrace technology. “Artificial intelligence is advancing rapidly and is changing the way law firms do business, the way we interact with clients and, ultimately, the way we think. The traditional model for delivering legal services is being redefined and clients expect their law firms to deliver more value,” he noted. Essentially, it boils down to this: Citizens can only get certain, very important things done if they speak to an expensive lawyer. Some areas of law have embraced the “flat fee” model, where clients just pay a set fee, but it’s by no means ubiquitous. However, it is a taste of things to come, Bassli says. “What does the law firm of the future look like? We better start talking about it because it’s not going to look the same. They are doing a lot of work that can be automated. There is all this tension happening in the entire legal ecosystem that really hasn’t happened before.” Digital transformation will create new lawyers, she says, who will have to provide high-level, deep-thinking legal advisory work. “Some lawyers do that now but there is a bulk who do repeatable, transactional work. They’re good at it, they have become fast at it because they’ve done so much of it; but if you’ve done that much of it, are we going to be able to train a machine at some point to do it? There is going to be a migration to the left and the right of skills. Some skills are going to go towards automation and being comfortable with technology, and other skills are going to go towards deep thinking while sitting with the board of directors and the CEO and CFO. At the moment, there is a big, mass-middle of lawyers. What kind of lawyer do you want to be?” For the next generation of legal professionals, that question needs to be asked in law school, where the notion of a closed legal world is shaped, according to Bassli. According to the Law Society, 25,155 UK students applied to study law at undergraduate level in England and Wales in 2016-17. Out of those, 17,855 UK students were accepted on to courses. “You have to go through law school to become one of us. What we are taught there is being tested, because when you come out you want to be hired by a good firm. Who are the good firms hiring right now? They are looking to companies like Microsoft, in-house, and saying: ‘What do you need for us to deliver to you?’ Microsoft might need some junior attorneys who also understand Sharepoint and aren’t overwhelmed by technology.

“The alternative legal providers are saying, ‘hey, we can do that low-value, high-volume, repeatable work for you, in-house’. They are trying to inch up the value chain; they don’t want to just do low, repeatable work because guess who is nipping at their heels? Technology. Low, repeatable work is going to get automated. So now the business model for alternative legal providers has to go up the value chain, and they’re nipping at the heels of the law firms – ‘hey, what are your junior associates doing? We should start doing that.’ Bassli expects this digital transformation in the legal sector to happen at Microsoft, too. The company has more than 100,000 staff worldwide, and instead of them phoning up her team every time they need legal help, Bassli wants to automate the process. Information, legal processes, basic forms and contracts can all be made obtained by individuals on their own if the process is made simpler. The key to making this happen is AI – specifically, bots. “We are working on a contract bot, because people don’t read long FAQs in Word documents about legal services. So, our chatbot is going to ask: “Are you looking for a statement of work template?” and if you say yes, the bot gives you a link to a statement of work template. If you say: “No, I’m not”, the bot will say: “What are you looking for?” It will walk you through the legal process based on some of the most frequently asked questions. “We are making it useful, and that’s where technology is interesting.”