WHITE PAPER

The AI Tipping Point for
Law Firms
Leveraging AI to Transform Knowledge Management
for the Competitive Advantage

Contents
The problem: The current approach to knowledge management is not working3

The solution: AI-powered enterprise search for effective knowledge management 4

The AI Tipping Point for Law Firms

Use Case 1: Winning new business by satisfying prospective client demands

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Use Case 2: Serving existing clients better by improving internal research

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Use Case 3: Leveraging information to drive efficiency and thecompetitive advantage

8

Conclusion

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About OpenText

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Connect with us

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This white paper focuses on how AI-powered enterprise search can transform theway that law firms identify, understand and use their information. With immediate
access to expert portfolios, attorney work product and analytics, firms can create
collaborative strategies that will help them stand out in today’s competitive legal
market. Enterprise search boosted with AI technology promises to vastly improvethese three key areas:• Winning new business by meeting increased client demands for accelerated
expert response;• Improving client service by leveraging internal legal information and work
product, and;• Developing a competitive advantage by differentiating the firm and improving theefficiency of its processes, technology and people.

The problem: The current approach to knowledge
management is not working
To do their work well, knowledge workers need access to all of their firm’s
information and intelligence, wherever it may be stored. They need to know where
their specialized expertise resides. Which of their attorneys have worked on whattypes of cases for which clients, and with what results? They need to serve theirclients effectively by quickly finding and referencing memoranda, contracts, legal
research, court filings and other work product. And they need to know exactly how
they’re operating so they can improve their business, from the tech they’re using totheir moment-by-moment spend or their allocation of resources.
To be clear, “legal research” in this context is not about searching a global databaseof existing case law but rather about searching internal resources to identify
precedents and relevant work product within the firm. Lawyers and legal support
staff typically must conduct this aspect of legal research manually, either by having
partners and high-value associates waste precious time scanning through theirarchives for information or by delegating that research to junior associates who maylack the skill or experience to recognize valuable precedents.
The same holds for searching for experts and compiling operational information,
including such basic information as case budgets and spend rates. In most firms,
that information—if it is captured at all—exists across a range of disparate systems,
many of which aren’t readily searchable.
Fortunately, recent advancements in artificial intelligence (AI) offer law firms a
better way to identify and use their own knowledge to win more business, serve
their current clients more efficiently and improve their internal operations.

ClientDemands
The AI Tipping Pointfor Law Firms:
The need to quickly
and accurately identify
relevant and hidden
knowledge proving
internal expertiseand experience.

The AI Tipping Point for Law Firms

Collective
Firm IP

Competitive
Advantage

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The solution: AI-powered enterprise search for effective
knowledge management
What firms need is a single sign-on, searchable, and universal view into theirbusiness and information systems, driven by the power of AI. Such a solution shouldincorporate information from the firm’s document management system, Microsoft
SharePoint, any file share drives, matter management systems and businessinformation systems, including HR and billing software—all without the need for
expensive technical resources. This compiled information would then be available
to search, using AI to identify related information even if it doesn’t precisely matchthe search terms.
How? To begin, an enterprise search tool securely crawls and indexes the firm’s
entire knowledge base, including all sources: document management systems,
intranets, individual drives, email archives, contact management databases, businesssystems and even websites and online content management systems. The systemthen uses its indices and AI to create concept models that are precisely tailoredto the legal information found during the crawl, based on content and extended
metadata. These concept models significantly improve the quality of search resultsby identifying related information across different sources, even in the absence ofspecific keywords, and ranking search results based on predicted relevance.
An enterprise search system is always up to date, as it incrementally crawls all data
sources and updates its internal models as documents change and new informationis added. This ensures that search results are always accurate and current.
To appreciate how AI-powered enterprise search can revolutionize law firms’
access to their internal knowledge base, consider the following three use cases.
Each demonstrates the inefficiency of the current approach and the promise ofenterprise search powered by AI.

The AI Tipping Point for Law Firms

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Use Case 1: Winning new business by satisfying prospective
client demands
When pitching new clients law firms must have fast, accurate access to informationthat supports the expertise prospective clients are looking for. Prospective clientsare often urgently in need of legal services, making time of the essence. Yet they
do not want to simply hear that a firm can handle whatever type of matter they
are facing; they want to see that the firm’s partners and associates have provensuccess in their type of matter before they sign on—or sign a check.
That means that flashing an attorney bio with claimed “areas of expertise” will not
suffice. Instead, law firms and partners must prove their expertise—rapidly—by
providing specific data points about their prior case experience.
Problem
As it stands now, partners will typically send a junior associate to collect that
information from the firm’s internal systems, including its matter intake, document
management and HR systems or its time-tracking and e-billing software. Searchingthese disparate, siloed data sources takes time, leaving potential clients waiting.
Nor is it failsafe: junior associates, who are called on to help partners and seniorassociates in a time-constrained situation, may lack the training and experience
to recognize relevant prior experience or may mistake irrelevant matters for usefulprecedents. The sheer volume of information that is required to siphon throughis overwhelming and frustrating, further contributing to human error or oversight.
That frustration is furthered by the fact that manual searchers have no way ofknowing—until they’ve searched every component of every system—whether
they’ve identified all of the useful, relevant information there is to find. Even whenan experienced expert conducts these searches, it’s difficult or impossible toobtain strategic, dynamic and fully up-to-date information without a universal
view to multiple data sources. In short, critical knowledge can remain hidden when
information sources are not integrated.
The bottom line is that an interested potential client waits, and waits, only to bepresented with a checkerboard of prior experience that is insufficient to establish
the expertise of the partner or the firm as a whole. The client, unconvinced that thisfirm can handle its business, turns to the next firm on its list—and the firm loses notjust potential revenue but also the opportunity for a longstanding client relationshipor referrals. What’s more, the firm loses the chance to further differentiate its
expertise or develop its market niche, slowing or halting the practice’s growth andopening it up to competitive vulnerability.
SolutionWith AI-enhanced enterprise search, firms win more clients because they havefaster, more reliable access to the information they need to decisively prove theirexpertise. They don’t have to rely on sales pitches or empty promises: they can let
their data do the talking.
By leveraging AI for knowledge management across an organization’s businesssystems, relevant information is made accessible from a single search, saving
valuable time and ensuring that law firms can respond quickly to prospective
client demands. This speedy response also demonstrates to the client that it won’t
have to pay the firm to learn about its issue while handling its matter. By crossreferencing document authors with content—including AI-powered concept
analysis of that content—firms can identify all of their relevant experience and

The AI Tipping Point for Law Firms

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The Return on
Investment from
Winning More BusinessIn a law firm with 30 equity
partners, each pitched
one new client per quarterat an average value of$50,000 per client. Before

rapidly and accurately identify their in-house experts, whether in the context of apitch or when a need for specific expertise arises in an existing matter.
Perhaps most importantly, AI-powered knowledge management practices help
firms connect the dots faster than humanly possible, displaying information frommultiple sources—some of which the attorney might not have thought to search—
together so that the firm can paint a complete picture of its experience with a
specific matter type. This information can even be assembled into graphics thatmake it easy to visualize, at a glance, the firm’s volume of experience and level ofsuccess. As partners become better at generating business and demonstrating
their expertise in fact-based pitches, they’ll gain the credence they need to become
better rainmakers.

implementing AI-powered
enterprise search, thefirm was closing one ofevery five pitches, for a
success rate of 20 percent.
Enterprise search improved
the success rate to 25
percent, enabling the firm
to close one of every four
pitches. That translates into
six new pieces of businessper year—or $300,000 in
additional revenue.

Actions speak louder than words. Don’t tell prospective clients that you can handle
their matters based on your partners’ biographies; show them that you havesuccessfully handled similar matters repeatedly in the past.

The AI Tipping Point for Law Firms

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Use Case 2: Serving existing clients better by improving
internal research
Winning the pitch is just the beginning. Law firms must be able to access theirlibrary of prior work product to efficiently and effectively serve their clients once
they’ve signed on. Documents are just one aspect of this information. For internal
legal research, attorneys need to be able to locate explicit and implicit information
quickly and easily.
Problem
For most firms, legal research—the need to locate earlier occurrences of similar
matters that may serve as an example or may justify similar results—remains alaborious, slow, manual process. As with searching for evidence of expertise,
inexperienced associates are often called on to complete the bulk of the legal
research legwork for current clients. After an associate has manually researchedand collected a broad pool of data, more skilled expert lawyers review that
information and cull the irrelevant information until they’ve identified the mostpersuasive and useful examples.
Yet, as internal data accumulates with each month and year that goes by, manual
searching becomes increasingly infeasible. The International Legal Technology
Association (ILTA), in summarizing its recent surveys regarding AI and machinelearning, called legal research the second-highest priority for the application of AI. In
its words, “the volume of data is not humanly consumable.” 1
The largest law firms have caught on to this: of the 481 firms surveyed in 2018,
every firm with 700 or more attorneys had implemented or was researching anapproach that would leverage AI/machine learning. ILTA’s “2019 Tech Survey”
reported the results from 537 firms and found that 97 percent of the largest firms—
all but one of them—was using or anticipated using AI/machine learning.2
It’s not just law firms struggling with data overload. Generally speaking, knowledge
workers spend as many as two hours a day searching for information, and as manyas half report that they cannot find the information they need to do their jobs
effectively.3 That information may be scattered across dozens of internal sourcesthat are challenging to search. Traditional keyword searches miss synonyms,
shorthand or abbreviated terms and typographical or data-entry errors.
Moreover, keyword search is inherently limited in its ability to spot relationships
between information or to recognize implicit information. This is a major
disadvantage; ignoring implicit knowledge is equivalent to viewing a flat image
rather than a three-dimensional model that would show the ways in which objects
are related and connected.
When associates spend substantial amounts of time collecting irrelevant or overly
broad information, partners necessarily write that time down, leading to lost
revenue. Further revenue can be lost when more skilled attorneys must complete
searches, weed through excessive results or otherwise verify or expand on
insufficient research. That frustration can have long-term effects too, leading tolawyer attrition—accompanied by further loss of legal work product and expertise.

The AI Tipping Point for Law Firms

1

International Legal Technology Association, “Survey Results for Artificial Intelligence & Machine Learning,”
December 2019, http://epubs.iltanet.org/i/1193169-aiml19/2?.

2

International Legal Technology Association, “2018 Tech Survey,” October 2018, https://www.iltanet.org/
resources/publications/surveys/2018ts; International Legal Technology Association, “2019 Tech Survey,”
November 2019, https://www.iltanet.org/resources/publications/surveys/2019ts.

3

8x8, Inc., “Over 50 Percent of Knowledge Workers Cannot Find the Information They Need at Work, National
Survey Finds,” October 9, 2019, https://investors.8x8.com/press-releases/press-release-details/2019/Over-50Percent-of-Knowledge-Workers-Cannot-Find-the-Information-They-Need-at-Work-National-Survey-Finds/
default.aspx.

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The Return on Investment

Solutionfrom More Efficient

By leveraging the power of AI, firms with enterprise search capabilities can expedite
and simplify this search for institutional knowledge. This increases the firm’s returnon investment, as less billable time is lost to write-downs, and captures implicit aswell as explicit information, transforming legal research into a high-level process ofgleaning smarter, more strategic information.

Legal ResearchConsider a firm with 100
junior associates with acollective blended billingrate of $250 an hour. Thesejunior associates bill, on
average, 2,000 hours per
year, and they currently
spend a quarter of theirtime performing legal
research. However, due
to inefficient searches, 10
percent of that researchtime is either unrecorded
or written off by thebilling partner, at a cost of$1,250,000. By adopting AIpowered enterprise search,
the firm cut that unbilled
time in half, recovering an
additional $625,000 per
year in additional revenue.

Smart search capabilities aren’t limited by the shortcomings of keyword searches.
With concept recognition, AI-powered enterprise search can locate and identify—
and then sort to the top of the pile—the most relevant and helpful clients, mattersand work product. By deploying a supervised machine learning algorithm, attorneys
train the system, with exemplar documents, to automatically retrieve and predict
relevant content. As attorneys access and search the firm’s data sources, including
document management systems, time-tracking and billing software, mattermanagement systems and other enterprise databases, AI runs in the background to
identify related information. The trained system captures related information, evenwhen critical words and phrases are misspelled.
AI can also reveal implicit knowledge hidden within the firm’s data stores. Whatfiles do attorneys access most often? Which matters or practice areas generate
the most billable hours? Which attorneys have worked on which types of matters—
and have done so most recently? By answering the questions that firms may nothave thought to ask, AI “enables firms to deliver better service to their customers
by drawing upon a richer, deeper pool of knowledge.”4
The benefits of AI-powered enterprise search extend far beyond these immediately
visible returns. With easier automated processes that avoid the frustration and hairpulling of manual searches, employees have more time for client communications,can get more done and may even be happier, improving retention of attorneys andsupport staff.5 AI technology also gives an edge to firms during hiring, and new
employees—including lateral hires—can more quickly grasp the firm’s areas ofexpertise and review the firm’s bank of knowledge assets without needing to know
where to search for them.
Together, these advantages translate into better client service—which itself drives
business through repeat engagements and positive referrals.

Use Case 3: Leveraging information to drive efficiency andthe competitive advantage
As Thomson Reuters observed in its “2019 Report on the State of the Legal Market,”competition in the legal market has become increasingly fierce as demand has
stagnated, leaving firms to squabble over market share. And that finite share is
being further divided as alternative legal service providers (ALSPs), global firms,
downstream legal services and freelancers join the fray. This points out the “uniquevulnerabilities” that law firms face: “unlike other businesses, [they] cannot protect
their two most critical assets—their people and their clients.”6

4 Simon Pecovnik, “Uncovering Hidden Knowledge With AI,” KM World, June 5, 2019, https://www.kmworld.com/
Articles/Editorial/ViewPoints/Uncovering-hidden-knowledge-with-AI-132146.aspx.
5 Bernard Marr, “How AI and Machine Learning Are Transforming Law Firms and the Legal
Sector,” Forbes, May 23, 2018, https://www.forbes.com/sites/bernardmarr/2018/05/23/
how-ai-and-machine-learning-are-transforming-law-firms-and-the-legal-sector/#fb7801a32c38.
6 Thomson Reuters, “2019 Report on the State of the Legal Market,” https://images.ask.legalsolutions.
thomsonreuters.com/Web/TRlegalUS/%7B7f73da9c-0789-4f63-b012-379d45d54cdf%7D_2019_Report_on_the_State_of_the_Legal_Market_NEW.pdf.

The AI Tipping Point for Law Firms

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Meanwhile, ALSPs, automated legal services and freelancers have swooped into
the resulting void to lay their claim on a market share that originally belonged
exclusively to lawyers and law firms.
What, then, can firms do to provide differentiated, value-added legal services,
improve their internal efficiency and generate a competitive advantage?
Problem
In its report, Thomson Reuters urged lawyers to “jettison some long-held assumptions”
about how law firms work and instead “imagine a new model of how the legal market
now works.” Specifically, it suggested that firms should consider becoming players inmore dynamic markets by adapting to specific client needs, emphasizing the individual
strengths of their lawyers and countering the threat from immediate competitors.7
For firms that are still relying on manual searches across siloed data stores, those
improvements will be all but impossible. Firms where attorneys waste hours, and evendays, searching for information are hard-pressed to find the time to anticipate andadapt to evolving client needs. Nor can those firms assemble sufficient information
about their practice strengths—or the case precedents to back up those assertions—to support the establishment of a market niche or specialty. Without these key
differentiators, law firms are vulnerable to competition from all sides. To makematters worse, firms that do not have unified search capabilities are generally unable
to rapidly assemble budget, spend, billing, HR and other business information needed
to improve their internal efficiency and increase their profit margins.
Solution
Again, enterprise search offers firms a single, overarching view of their entire bankof knowledge. This enables the practice to establish its unique expertise and create
marketing that specifically promotes those strengths, creating a differentiatedmarket position. Demonstrated expertise attracts clients by reassuring them thatthe firm can handle their particular business and by improving value, as clients will
not have to pay the firm to come up to speed on the services they need.
Firms may also recognize niches of unique expertise that have developed over time,and possibly under the radar, so that they can market proactively to clients withthese specific needs. Additionally, a law firm with AI-powered enterprise search
can identify which matters and practice areas have historically been more or lessprofitable so that the firm can shift its focus to maximize revenues or otherwise
improve its efficiency, increase its productivity and mitigate its risks.
By building its store of useful, accessible institutional knowledge, a law firm cango beyond identifying experts, promoting itself effectively in pitches and serving
existing clients well. The firm can then integrate its information across dozens ofinternal systems to understand how it operates and how it can improve its own
efficiency and profits. Integrated enterprise search can also improve attorneysatisfaction—and thus retention—by allowing attorneys to focus more intensively
on developing their specialties instead of constantly struggling to get up-to-speed
on a multitude of practice areas.
All told, firms that use AI-powered enterprise search to connect the dots among
disparate data sources can rapidly identify, organize and extrapolate informationfrom all of their documents and systems, increasing their ability to differentiate theirservices and driving up their profitability.
7

The AI Tipping Point for Law Firms

Thomson Reuters, “2019 Report on the State of the Legal Market,” https://images.ask.legalsolutions.
thomsonreuters.com/Web/TRlegalUS/%7B7f73da9c-0789-4f63-b012-379d45d54cdf%7D_2019_Report_on_the_State_of_the_Legal_Market_NEW.pdf

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Conclusion
Decisiv demo
OpenText Decisiv
Product Overview

AI-powered knowledge management offers law firms a way to win more pitches,
improve service to their existing clients and generate competitive advantages
from more targeted marketing campaigns to improved internal operations. It
allows attorneys to access both relevant, explicit information and hidden, implicit
knowledge, and to do so faster and with less frustration.
OpenText Decisiv combines all the benefits discussed in this white paper andmore. Its single sign-on saves time and seamlessly integrates with all the firm’s
data stores, generating a unified view regardless of how siloed or disparate theyare. It increases individual productivity by allowing attorneys to build personalized
work environments, complete searches from within their own work products,
save searches and build their own knowledge search application. This allows for
an increased firm-wide ROI by building and leveraging banks of information anddirectories of experts.
Decisiv helps firms pitch clients more effectively by returning credible information—
supported by concrete facts—to establish the expertise of a given partner orthe firm as a whole. Instead of relying on attorneys’ biographies, Decisiv quickly
identifies expertise from actual work history, gleaned from billing and time-tracking
systems as well as document management systems. And it does so rapidly, so thatprospective clients aren’t kept waiting or wondering whether the firm is competentto handle its business.
Once the client has signed on, Decisiv speeds up internal legal research by suggesting
potentially relevant documents and information based on its experience, including
what has been previously approved as valid or rejected as unhelpful. With that
feedback, it continually improves its predictions with each new suggested documentthat a researcher rates. Decisiv also improves profitability by reducing write-downs forunbillable hours spent on inefficient searches or irrelevant, overly broad results.
Decisiv can even improve a law firm’s competitive standing by targeting areas ofniche specialization, thus enabling specific marketing and advertising campaigns,
and identifying inefficiencies in the firm’s practice.
The increasing competitiveness of the legal marketplace demands that lawyers
and law firms transform their approach to knowledge management. Between
heightened client demands, the need for prompt and accurate legal research, and,stiff competition from other firms and new market shareholders, law firms must
make strategic choices that will gain a competitive advantage. Integrating Decisiv's
AI-powered enterprise search with knowledge management systems can help yourfirm stand out by establishing your expertise and putting all of your firm’s diverse
information at your fingertips.

About OpenText
OpenText, The Information Company, enables organizations to gain insight throughmarket leading information management solutions, on-premises or in the cloud. For
more information about OpenText (NASDAQ: OTEX, TSX: OTEX) visit: opentext.com.

Connect with us:• OpenText CEO Mark Barrenechea’s blog
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