Augment 2019: Professional Services Laying the Groundwork for AI in Practice

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CHICAGO — The Legal Executive Institute’s Augment 2019 conference stuck a finger in the wind of how far artificial intelligence and its ilk have transformed the practice of law and found that while much is being done in applying these technologies to legal, there is still a long path to travel.

The event brought together representatives of law firms and tax and accounting firms to share progress in building out the infrastructure for the application of AI in their respective professions. And while there were many refreshingly forthright assessments of how far the industry has progressed at this event — including many solid examples of the use of machine learning, natural language processing, and other AI technologies — there were also honest discussions about the groundwork yet to be executed for many types of these applications.

More interesting than the specific applications discussed were some of the speakers’ comments on the metholology, processes, and organizational issues related to the adoption of AI techniques, including:

  • Katherine Lowry, Director of Practice Services at Baker & Hostetler, started with a map of the hundreds of legaltech startups coming after the space. In the face of that onslaught of technology, she said her team focuses on an incremental approach and a vision for the future. Part of that is having a methodology for evaluating vendors. For example, when evaluating contract analysis vendors, she’s seen a reduction of up to 50% in the time spent on evaluation. Another interesting tidbit — she’s hiring students right out of law school to work as data engineers, applying legal domain knowledge to data-driven tools.

  • Peter Geovanes, Head of Data Strategy, AI and Analytics at Winston Strawn, reflected on a sea change that’s happening in data governance: data is shifting out of IT and into business units. It’s not that the IT department’s skills are not needed or insufficient, but rather the shift is a recognition that the data is becoming more of a strategic asset rather than a back-office concern.

  • Brad Peterson, Partner at Mayer Brown, noted the importance of having a focused team that understands data and AI techniques. “You can’t let a thousand people at your firm all do their own thing,” he said, adding that in the end it’s not about a set of point solutions but rather an end-to-end transformation of the organization.

  • On the tax and accounting side of this conference, Derek Bang, Chief Strategy and Innovation Officer at Crowe, compared the current state of AI development to changing the tires on a moving vehicle. Businesses move fast enough without simultaneously having to organize around data and AI, he noted. Bang employs no fewer than 25 full-time data scientists, and he expects to double that in the near future. He addressed the common saying that “data is the new oil” by noting that like oil, data needs to be refined and repurposed for specific applications, adding that a data strategy isn’t just about “managing” data, but about looking for new revenue streams sourced from data reserves — “data as a business.”

  • Geralynn Hurd, CPA, Tax Partner and Tax Technology Unit Leader at Crowe, spoke of some specific needs that arise in the profession when AI tools become a part of the mix. As usual, everything starts with data — and the agreements that professional services organizations need when they use client data are getting more complex and robust, as new access rights are taken into account. Education for the entire organization is also a must — the hype around AI has to be met with a firmly-grounded set of expectation.

All of these organizational issues around education, resources, and process require an AI adoption and implementation strategy.

Dera Nevin, an Attorney specializing in Information Governance and eDiscovery, and Karen Wiltgen, Principal at RSM US, provided a look at data governance and strategy, as well as techniques for organizational strategies in which AI meets the firm’s business offerings. In many cases, particularly where AI is being leveraged in customer-facing applications, the new technology is changing the nature of the businesses that professional services firms are in, which is exactly where governance, organizational structures, and strategy need to be re-examined.

The overall impression left by this set of speakers was that legal and tax & accounting businesses are actively rolling out real AI-based services inside and outside their firms, but are much more focused on getting the strategy and organizational pieces right the first time, without letting up on the pressure to move forward incrementally.

We’re hoping to see at Augment 2020 how far the needle has moved.