TRP 339: [Legal] Artificial Intelligence, Legal Tech and the Future of Law with Eric Thurston

[00:00:10] You're listening to The Rainmaking Podcast, hosted by legal dealmaker, author and professional speaker, Scott Love.

[00:00:25] You're listening to The Rainmaking Podcast, and my name is Scott Love. Thanks for joining me on the show. Ladies and gentlemen, we have a special guest today. His name is Eric Thurston. He's the executive chairman of SharePoint. Now, if you've heard of SharePoint before, it's probably because I mention it every time I introduce our show, because they've been a long time ago.

[00:00:44] I'm the first time sponsor of The Rainmaking Podcast, and I really appreciate that. So this means a lot to me. Let me tell you about Eric Thurston. His role as executive chairman of SharePoint, he's seen everything in terms of legal technology. He's worked in other tech issues before, but legal, of course, is very special. It's complex. There's a lot of nuance to it. And today we're talking about artificial intelligence, legal technology, and the future of law. If you're a law firm leader, this is going to be one that you need to listen to.

[00:01:13] And if you know law firm leaders, you need to share this episode with them. Also, I wanted to make an announcement that SharePoint is having their annual Ignite conference on September 14th, 15th, and 16th in Savannah, Georgia.

[00:01:27] When you go there, you'll learn more about artificial intelligence and emerging legal technology innovations. They have sessions on financial and operational excellence, topics related to growth, talent, and competitive strategy, as well as product roadmap previews and hands-on training sessions. You can register for that by going to the link in the show notes of this podcast. And also, you'll be able to connect with Eric directly.

[00:01:53] As always, this podcast is sponsored, of course, by SharePoint Legal Insights, formerly known as Leopard Solutions, turning legal intelligence into opportunity. And the show is also sponsored by The Rainmaking Magazine. For the intellectually driven and results-focused professional that wants to be the number one professional services provider in their niche, start your free subscription today.

[00:02:17] Visit therainmakingmagazine.com to set up your free access and chart your course to greater rainmaking success. Thanks for listening. And I know you're going to get some great ideas from my conversation with Eric Thurston today. Hey, this is Scott Love with The Rainmaking Podcast. Our special guest today is Eric Thurston, and we're talking about artificial intelligence, legal technology, and the future of law. Eric, thanks for joining me on the show. Thanks for having me, Scott. It's a pleasure to be here.

[00:02:47] Absolutely. And as I mentioned in your bio, as we introduced who you are, you have a wealth of knowledge, not just in legal tech, but in M&A. And other interesting things. And right now, with what you see from your perspective with InsurePoint, a preeminent legal tech company, what are some of the things that are on your mind as you look at the legal landscape and how technology is impacting it?

[00:03:14] Well, it's really been an interesting last two or three years. You know, with artificial intelligence, we like to say it's almost sucked the air out of the room from a technology perspective, meaning so many firms are focused on AI. How do we use it? What is it? You've got it on the practice of law side and then on the business of law side. And so what's really been happening recently is I would say things are settling down to where people are now understanding use cases, how artificial intelligence can benefit them.

[00:03:43] And certainly on the business of law side, there's a lot of internal process, internal efficiencies that can be gained. But there's also the revenue side of that. How do we grow revenue faster, leveraging some artificial intelligence tools? So if you ask somebody two years ago, how are you going to use it? They would say chat GPT and I'm going to ask it a question. Right.

[00:04:04] And so now it's really becoming more of how does it become part of your technology landscape, integrate with your existing systems to really drive value for you and ultimately for your customers? Right. Let me ask you this. I like the way you kind of segmented that. Can you kind of go through a listing again of what are the areas that tech is impacting legal? You talked about on the practice side, people that are actually practicing. Then you mentioned on the business side. What does that mean exactly, Eric, when you say the business side? Yes.

[00:04:31] When we think about the business side, it's everything that that happens almost behind the scenes in some cases. So you think about time and billing, running the firm, human resources, you know, even matter intake and many of those things that recruiting, talent management. Those are all part of managing the business side of it versus actually practicing law. And both of them are equally important. There's great technology tools for each one of them.

[00:04:56] And I think across both of those segments, firms are starting to figure out how does artificial intelligence play into that. Yeah, absolutely right. Is there any area of convergence that you see where some firms are starting to get a little bit more synergy? They're able to make adoptions quicker and easier. They're able to see that this actually aligns with what we do. Are there things that you've seen in that regard? Yes.

[00:05:20] We're starting to see firms figure out what are some of the mundane tasks, the very repetitive tasks that you can use technology for. That's a great place to start with artificial intelligence. So it is converging from the perspective of they're figuring out how to put it to use on a daily basis, which, again, has just been so difficult for them to figure out. If you think about it, they're so focused on practicing law, on driving value for their clients.

[00:05:47] The back office or the internal efficiencies tends to take a backseat. And you're really starting to see that pick up. Yeah, right. What do you think have been some of the areas that law firms are struggling in how they implement and adopt tech tools and artificial intelligence? Where do you think they're really struggling the most? You know, in general, the legal industry can be laggards in adopting technology. It's just not at the forefront of their mind.

[00:06:16] And so this has been pushing it to be a clear business strategy for a firm. And so a lot of times, out of sight, out of mind, don't change a system. If it's there, it's working for you and it's been working for forever, 10, 20 years. And now firms are realizing some of these older systems just are not able to interact with, to work with artificial intelligence tools.

[00:06:39] And so they're having to look at their entire landscape of technology, tools that they use, how modern are they or aren't they? And then how do we move those forward? Buy new products. How do we implement them? And then along with that goes the change management. So many firms think, let's just plug in a new tool. It'll work. It'll be great. And it's not great. Like the change management side of it is really, really important.

[00:07:04] And so the firms that are really differentiating themselves and doing a great job are looking at change management along with the tools. Let's not just buy something. Then let's figure out how we're going to change how we run our firm using those tools. Yeah, that's interesting. How do you think that affects client service? Because I know that's one thing that every good attorney really has on top of their mind and every law firm leader does where they have all these other things they have to think about. But at the end of the day, it's all about the client.

[00:07:32] How do you think AI and technology will impact law firm client service, Eric? I think ultimately it's going to be really helpful. Clients have different expectations, whether that is around how you price the work that you're doing, how you deliver that work. So the clients in many ways are driving those expectations, client portal, visibility into what's going on that obviously then ripples back through the law firm.

[00:07:58] I also think you're going to see attorneys freeing up more time to the tune of, you know, it can be a few hundred hours per year to focus on the client because you've got efficiencies in the back office. And so, you know, those efficiencies are going to help you drive revenue. They're going to help you be in front of your clients, more driving value for them. So that to me is a huge benefit if you can take administrative tasks and just some of the mundane off of their plates and allow them to be focused on delivery.

[00:08:28] Right. I had just the other day, I had a law firm leader that I'm talking to. He mentioned that he had to get a document done. I need to do a term sheet instead of giving it to an associate. He put it in AI and he said it was good enough. Do you think that there are some real changes in terms of how firms operate that they need to be ready for? Yes. And I think one of the big things that's really become visible over the last year or so is security, data confidentiality, all of those sort of things.

[00:08:56] And so once you know you've got systems where you can be using, whether it's Claude, OpenAI, all the various tools, because quite frankly, they're going to power so much of this and you get that in a secure environment. Absolutely. You can. An attorney can be so much more efficient by using those tools to, you know, review documents, draft documents, all of those sort of things.

[00:09:19] It is so much faster than before. And that's been you're seeing that continue to grow with concerns around the AI hallucinations. You know, people are learning also don't just take the answer. Sometimes you iterate like what prompts do you use? How do you engage to make sure that you're getting a good outcome out of those tools? Right. And I think one unique wrinkle to that in terms of the structure of law firms is there going to be a need for associates.

[00:09:44] I think I've even seen some firms say we're going to adopt this. We're going to change our business. We're going to be on the cutting edge in the legal world. What what are your predictions in terms of how law firms are structured using associates? Is there anything in that regard that you can share with us with with the adoption of AI and other tech tools? I think it'll change slowly over time.

[00:10:07] You know, I think the structure side of it always takes longer than you think, because it's so much of it's ingrained in so many years of it being done a certain way. But I don't think, you know, lawyers are going to go away. A couple of years ago, people were saying because of AI, lawyers are going to go away. Now, you may have more associates. You may have more people reviewing documents using the AI tools on behalf of of a partner, for example. But the amount of work is going to continue is still going to be there.

[00:10:36] Think of a client that brings you their assessment of whatever matter they're dealing with or contract. They've used AI. You've got it. You've got to look at what they've provided you. You've got to be able to analyze that. And so in some ways, it's going to create a different stream of work that may be more associate appropriate and teeing up a partner to be more effective in what they do. Right, right. Let me ask you this from the law firm leader perspective.

[00:11:00] Now, let's say there's a chairman or managing partner of a firm, 500 to 1,000 attorneys, or maybe even less than that. It really doesn't matter because they're dealing with a lot of the same issues, even though at a larger scale. What are the things that your people are seeing in terms of pushback they're getting from law firm leaders and their resistance to change? And I'm glad you even mentioned change management because that's the thing. That's something that leaders have to be aware of because you're dealing with people that have to make changes.

[00:11:29] What's in general besides that, what are areas of pushback that you think your people are seeing when they're talking to law firms about adopting new tech tools and other solutions? There's pushback in a couple of areas. One is they're almost just they're bound up by what do we do because there's so many new tools and it's so new. Nobody wants to make the wrong move.

[00:11:56] You know, no law firm administrator, COO, CFO wants to recommend a solution, go through the project and be wrong. And so previously, you know, let's say you're going to implement a new practice management solution. That's a pretty straightforward project. It's not anymore because of artificial intelligence and what is the direction that our provider is going to go. How do we give ourselves optionality?

[00:12:23] How can we be able to have a technology roadmap to leverage new tools that come out two or three years from now? So that has been a real constant theme of law firm leaders. And they also don't want the project and the disruption on the business. So if you're going to, again, let's just stick with the practice management theme. That's your accounting system. You know, it's your time, your billing. Do you really want to change that out if you don't need to? And so they're trying to understand why should we do that?

[00:12:52] How does that empower some of the things I talked about earlier? Better revenue generation, better efficiency in the firm. And you really do need a modern platform. Some of these older monolithic solutions, you just can't get to the data. You can't analyze it. And you can't use the new tools. And so I really think it's consternation around making the right decision so we don't disrupt the firm and have to do it again in two or three years. Because it'll be a different person doing it. Like everybody knows that.

[00:13:21] So we see a lot of that going on. I bet you do. I know there's a lot of change right now. If you look at the way law firms are recruiting right now, that's different. The whole merger opportunities within the context of private equity and managed services organizations, that's a change also. Then you have to add on to that technology. How do you think some firms might miss the boat on this? What do you think could happen to a firm overall, not just in terms of how they practice, but how they get business, how they recruit,

[00:13:50] if they don't stay sharp and on the cutting edge of technology? It's a great question. You know, we've got the unique, we're in the unique position at SharePoint to see, you know, thousands of law firms. We've got several hundred using our practice management solutions. We've got a few thousand using our data solutions.

[00:14:11] And so you really see firms that are, that differentiate themselves by being forward thinking, both in how they run the firm. I'll give you an example. One of our firms, one of our customers changed the name of the firm from the names of the partners to a more business centric name. And I'll tell you, it was so, you know, there's no question they're thinking about the future.

[00:14:38] So they wanted a name that spoke to what they do versus the names on the door. They're thinking about how do we either get bought or how do we buy, how do we become a platform to buy additional law firms? And so those thought leaders that are thinking about how do we run a better business, how do we become more process driven, all the things the private equity firm is going to look for in them versus those that just, hey, we've been doing it this way forever.

[00:15:07] Our current systems are good. Let's just, you know, let's just stand pat. And obviously there's, there's a middle ground to that, but those that are looking at how do we leverage technology to be a differentiator? That's only a part of it. How do we look at our business strategy to really become, you know, almost more of a company than a law firm? What's our brand? What do we focus on? How do we drive business?

[00:15:32] Because technology tools, you know, the old way of rainmaking is, it still works. The person still really matters, the partner. But technology tools can help you drive demand for your business, manage pipeline, find leads and all those sort of things. And so I really think there's a lot of firms that are becoming more and more proactive with thinking about that from a future perspective. I think that's great. Right. It's so funny that the fundamentals won't change. It's human to human contact, but I think it can accelerate the time.

[00:16:02] It can accelerate. It can pinpoint who exactly is somebody you should talk to and why is that and how can you develop that trust? How do you think this kind of speaking along these lines, how do you think technology, artificial intelligence, can help a law firm improve their effectiveness in business development and client acquisition? Yep. Yeah, that's also a great thing to think about.

[00:16:27] So there's really a technology stack that's going to help that, which is a CRM tool plus artificial intelligence plus data. So there's the recruiting side of that, of course, and bringing in the right talent. But it's also understanding everything you've done historically. So the types of matters, the amount of hours, how you've executed on those. You've got this great data set around how you've been running your business for 10, 20, could be 30 or 40 years for some of these firms.

[00:16:57] So how do you unlock that data to where, you know, if you want to go with some alternative fee arrangements, have confidence that you can price them correctly and that you can offer those out in the market to be differentiated? Certainly firms are getting smarter about how to do that. But again, you've got to have the right tech stack, the right data set to be able to do that. But that's certainly something we're seeing firms do more of. Interesting. I think this is a time of great change.

[00:17:24] And this reminds me because I've been in the recruiting industry for 30 years, over 30 years, back before there was an Internet, back before there was LinkedIn, before, you know, just when AOL was your email. That's how long I've been doing this. And when I got into legal back then, people were talking about the end of the billable hour. And I just think I think that the essence of law firm strategy is based on, hey, what's that other firm doing?

[00:17:52] Nobody wants to be first because the whole industry is built on precedent. What would be your advice to a law firm leader that's hesitating making these changes? What would you tell that person so that they can get comfortable with getting their whole team on board and making investments and making commitments to these areas, these solutions that are out there? You know, to me, it starts with the strategy of your firm. So bring in people to help you do that. What is our strategy? Where are we going? Where do we want to be?

[00:18:22] There's a lot of firms that don't necessarily have a thoughtful three, five-year business strategy beyond doing what they're doing. And then how will technology help enable that for us? You know, because technology for the sake of technology isn't, you know, we've seen a lot of projects go awry because there's not a bigger strategy within the firm for how to use that. I'll give you an example.

[00:18:46] CRM, I always found this kind of funny, but we have a CRM tool that people would use and they'd say, that's what we use to print the labels for our Christmas cards. That was their, you know, customer relationship management software. And now it's just gone so much further than that. But you've got to have firm leadership that says, here's how we're going to use these tools and be pragmatic about it. You know, there's so many things these tools can do, but pick the top three or four things you want them to do in your firm. We're leveraging technology to drive revenue.

[00:19:16] We're going to do it in these ways. That way, when you implement those tools, your team is going to have focus. They're not just implementing everything that tool can do. So I really think that's super critical. And also focus on the revenue side, which is customer-centric, obviously needs to be taking care of your customers. And then the efficiency side for internal productivity within the firm. But don't over-index on one or the other because both are really important and valuable. Yeah, right.

[00:19:45] So tell me a story then of a firm that may have been one of your clients. And you don't have to mention their name, of course. What were the challenges they were facing when your team talked to them about your solutions? What were the hesitations they had? How did they go through that? And what were the results that occurred when they implemented your solutions, trained their people on how to use them, and really saw this was a good decision? Yeah.

[00:20:10] So thinking of a specific firm, I'll leave their name out because they do not want me to use it. But they were really just using older technology, tremendous amount of attorney time spent on administrative tasks, which is wasted revenue in so many ways, and frustrating for those attorneys.

[00:20:36] And so they really looked at how do we make the attorneys more productive through the use of technology, through the use of efficiencies within the back office. And they identified potentially $70,000 to $100,000 per year per attorney of improved revenue by doing that. And it's simply, let's use technology to streamline processes, because not a lot of firms can be process-centric. Maybe it's the process that's in somebody's head.

[00:21:05] It was more documenting their processes around how they run the firm and show value through that. So I would say we see that pretty consistently of better process management, more prescriptive, more consistent, driving value through time savings. That's great. That sounds like it was a good decision for them. Yep. Absolutely right. And so let's kind of bring our conversation to a close. I always close it with three action steps.

[00:21:35] If there's a law firm leader that's thinking about making changes in the world of technology, artificial intelligence, and you were to advise them three action steps they can take to really get started implementing some of these ideas that you share, what would those three action steps be, Eric? I think really there's three things I think about, which starts with that firm strategy and process optimization. So think about how you're going to leverage technology tools before you get into that.

[00:22:04] Certainly on SharePoint's website, we've got a tremendous amount of content, thought leadership, and we can provide the links to go look at that. But it's really focused on the business value that you're trying to drive, data cleanup, because you have so much data about how your firm is operated that can be leveraged by artificial intelligence tools to drive continued value for you. So that would be the second one. And then find the enabling technology. So have a strategy around process improvement driving value.

[00:22:32] Dig in with data cleanup and then deploy those enabling technologies on top of that is an incredibly effective way to do it. That's great. That's good advice. Thanks so much for being on the show. Before we go, tell our listeners about SharePoint. What are the solutions that you have, things that you'd like for them to know about you? And we'll put the links on the show notes that people can go and check that out directly, Eric. Yep, absolutely. So SharePoint's been in business in the law firm market for over 45 years.

[00:23:00] We've got the best accounting solutions in the market. So when you think of running your business on the back end, we've got great solutions for that. For finance, we also have the front office growth-related solutions to help attorneys be more efficient with what they do. I think great solutions, usability and processes for them to use. And then data. So our legal insights data to help them with benchmarking their firm against others, to use it in the recruiting process.

[00:23:28] We've got great data for that. So it's really software solutions combined with data, leveraging artificial intelligence across all of those for our customers. Indeed, you do. And my personal testimony for people listening is that this is a really fine company that has those solutions. Leopard Solutions, part of your company's entity now. SharePoint Legal Insights has always been a sponsor of our show since we started. So I want to thank you for that, Eric. Thank you for your collaboration and partnership. And thank you so much for being on the show.

[00:23:56] I look forward to having you on here again talking about other interesting things. Thanks for having me, Scott. Thank you for listening to The Rainmaking Podcast. For more information about our recruiting services for international law firms, visit our website at attorneysearchgroup.com.

[00:24:17] To inquire about having Scott speak at your next convention, conference, sales meeting or executive retreat, visit therainmakingpodcast.com. Thank you.