Lawyers in solo and small firms intend to adopt artificial intelligence at a much faster pace than lawyers in large firms, but clients are even more enthusiastic about the technology, and artificial intelligence means more We believe in quality service at a more affordable price.
2024 says so Legal trends for individuals and small businesses The report, released today by law practice management company Clio, examines the state of solo and small firm law practices based on aggregated data from Clio users, a survey of 1,446 legal professionals at firms of all sizes, and a separate survey of 1,012 U.S. adults.
(The report defines a small firm as two to four lawyers and legal professionals; anything larger is considered a “large firm.”)
The report examines a variety of financial and technology trends for private and small firms, but for the first time this year, it also examines the impact of AI on legal practice. We found that lawyers at law firms of all sizes remain cautious about using AI in their practices.
“Slightly more than half of lawyers in large, small, and solo firms believe that AI is not advanced enough to be trusted, and just under half of lawyers in these groups also believe that AI is not advanced enough to be trusted. “You're almost as likely to claim you don't trust them,” it says.
Still, the report also reveals that a majority of lawyers believe the potential benefits of AI outweigh its costs. Additionally, 19% of legal professionals Clio surveyed across companies of all sizes said they already use some form of AI in their work.
Among those who say they are not yet using AI, lawyers in solo and small firms are much more likely to adopt AI quickly, with 40% of solo firms and small firms of lawyers say they plan to implement AI within the next six months. , compared to just 24% of lawyers in large firms.
The report posits that this makes sense, as individuals and small businesses can greatly benefit from the automation that AI brings due to their efficient operations and fewer resources.
“For businesses with fewer resources available, as is often the case for individual businesses and small businesses, AI offers significant potential to scale their business and effectively punch above their weight,” the report said. Masu.
AI-friendly clients
However, the report finds that while many solo and small firm lawyers appear ready to adopt AI, prospective clients are more open to AI technology. I did.
The report states that 19% of sole proprietors and 20% of small businesses believe the benefits of AI outweigh the costs, while 32% of consumers believe this. Further afield:
- 38% of prospective clients believe that lawyers who use AI-powered software can provide more affordable services than those who don't.
- 32% of prospects believe that lawyers can provide better service using AI software.
As this chart shows, clients are much more favorable to the use of AI than lawyers are for certain legal tasks.
“Considering virtually everything, potential clients are likely to believe that law firms should leverage AI for common legal tasks, from marketing to legal research to billing. ” states the report.
What this means for small businesses is clear, with the report suggesting: Companies that adopt AI software and promote its use may have a competitive advantage in marketing.
lack of details
Reading this report, I was frustrated that it never defined what AI meant or what type of AI we were talking about. References to AI are widespread and common. We do not know whether this study differentiated between new forms of generative AI and other forms of AI that have been available on the legal market for years.
This is important. If a survey asks a lawyer to self-report his use of AI, the lawyer cannot simply assume that he understands the breadth and nuances of AI technology. Even though Westlaw has been incorporating AI for decades, a lawyer who uses Westlaw for his legal research may deny ever using AI.
So when research says 19% of lawyers are already using AI, what does this actually mean? What kind of AI are they talking about when they say that? I think we have to read between the lines and assume that the AI in question here is generative AI, but that could take many forms. And if it wasn't specified in the report, was it included in the questionnaire?
However, this survey asked lawyers what they would like to use AI-powered software for in the future. The graph below shows the responses, but the report does not say whether these are the only options available to respondents in the survey. As you can see, already common uses of AI such as legal research, summaries, and drafts are not included.
Two other AI findings from the report:
- Almost one-third (30% and 33%) of lawyers in solo and small firms believe that AI software will reduce the need for paralegals, compared to 30% (30% and 33%) of lawyers in large firms. Only 23% have
- Only a minority of lawyers are concerned about regulation of lawyers' use of AI, with 17% of solo lawyers and 21% of small-firm lawyers saying they would never approve of their lawyers working with AI. ing.
Again, this last question requires further elaboration. Most lawyers have been using his AI in some form for decades, even for legal research, without any suggestion that the bar prohibit it. So it's clear that this question has a specific type of AI or application in mind, but the report doesn't explain it.
unique opportunity
The key takeaway from this report's findings on AI is that AI presents a unique opportunity for solo and small-firm lawyers to do more with less.
“For solo and small firms in particular, AI offers an incredible opportunity to expand their legal services delivery capacity by automating common tasks that may require more resources or take time away from lawyers' busy days.”
A final note about the report: This report covers much more than AI and is well worth reading for anyone interested in trends in law practice for solo and small-firm lawyers. Other important points:
- Lawyers in solo and small firms face challenges from lockups such as unbilled work in progress, uncollected debtor accounts, and other unbilled and uncollected money.
- Solos' billing rates have not kept pace with increases in the Consumer Price Index.
- Billing and collections are strong among individuals and small businesses, but billable hours are decreasing.
- Although the occupancy rate of individual companies and small and medium-sized enterprises is increasing, it is still below that of large companies.
- Recovery rates are improving for companies of all sizes, but not by much.
The full report can be downloaded for free from Clio (clio.com/ltr).
