Is Legal AI Approaching The Chasm?

Electric vehicles have a problem, and it’s not the lightning rod of Elon Musk. New sales have slowed across the industry. 

Jeremy Korst wrote in Harvard Business Review, “A couple of years ago, we seemed to be hurtling toward an electric-car future. Tesla had reached a trillion-dollar market cap; Hertz had signed a $4 billion deal with Tesla to supply cars for its rental fleet; the Biden administration had announced plans to make EVs comprise 50% of all new vehicles sold by 2030; and GM had committed itself to achieving 100% EV sales by 2035.”

But all of that has changed. Why? Because of the Adoption cycle. In the Geoffrey Moore classic, “Crossing the Chasm,” he explains how Innovators and Early Adopters will buy new technology products for different reasons than the majority of buyers. Early Adopters are more willing to take a risk and may use a product for different reasons than the majority. For electric vehicles, early buyers were motivated for environmental reasons. They might have been fascinated with the re-imagined features of a Tesla-like software upgrade, self-driving features, or the additional roominess (the motors are attached to the axles of the car). There are other great reasons to buy an electric vehicle.

Early Adopters can be thought of in the same vein as influencers on social media. They help define what is cool and will put up with issues that others who are more pragmatic might not.

Those in the Early Majority of the Adoption cycle are more pragmatic and less willing to tolerate issues like finding a nearby charging station and waiting the extra time for a charge. That isn’t pragmatic in a hurried schedule when their daughter needs to be at her softball game two towns away. Battery performance degrades in the cold. A commuter in Minneapolis may shy away from an electric vehicle on a subzero, snowy Minnesota morning.  

It’s obstacles like these that keep two-car families from severing their relationship with the gas station, and it’s why tax incentives and regulatory mandates can’t always force behavioral change.

So what does this have to do with legal technology and AI? Well a lot. The same Adoption cycle will apply to AI solutions.

The good news is that lawyers are using AI frequently. The Wolters Kluwers’ Future Ready Lawyer Report found that 76% of attorneys in-house and 68% of attorneys at law firms used AI every week.  The study didn’t dig into what AI technology is being used or for what purpose though.

Not All Law Firms Are Early Adopters

Crunchbase reports that over $10 billion has been invested in legal tech from 2019. Although that much money suggests the promise of legal tech, it also demands a return.

A set of law firms are purposefully tech-leading.  They are typically the firms that are in the news, like AO Shearman and their recent announcement with Harvey. But there’s also a larger group that isn’t in the news regularly. What has struck me as I have spoken with firms over the last year is that the majority are being rather deliberate in how they select and adopt AI technologies. They aren’t sitting still, but they aren’t blindly pushing for the AI version of existing products, and they haven’t yet decided on new AI workflow solutions.

This is important for vendors and law firm buyers alike. Vendors may underestimate the willingness and readiness of the majority of firms to buy an AI solution. Their pragmatic nature may want to see real justifications, and they may expect more guardrails to support ethical AI and AI governance than Early Adopters. Law firm buyers on the other hand need to keep a pulse on the expectations of their clients. Law departments move faster than firms, and when a client expects work to be done with AI or technology assistance, those firms had better be prepared. Client satisfaction is very pragmatic.

Purchase Does Not Equal Adoption

In any industry, the success or failure of a software solution is dependent upon adoption and acceptance by users. This is especially true in law firms. Vendors may underestimate the effort it takes to secure the adoption of end-user attorneys across a firm. Large firms are composed of a series of practice areas led by different partners and can operate almost like separate businesses. Getting traction in the tax practice does not guarantee the capital markets practice is going to adopt. The pressures of the billable hour have created longstanding challenges for the library, knowledge management, and IT staff who are very willing to train end users.

Even some of the more prominent AI solutions touted in the market are struggling to secure the intended adoption.  

Managing The Chasm

So how should the industry manage the so-called Chasm? The first thing is to be aware that it exists. Electric vehicles were plugging along with brisk sales and then hit barriers. It’s almost as if everyone forgot about the Chasm. 

Legal tech vendors should be eyes wide open and recognize their solutions may require more functionality to overcome the pragmatic objection of the Early Majority. And they need to consider how to help with adoption. It may mean more adding resources to a customer success or professional services team. It might mean partnering with one of the more established vendors that has access and distribution. Similarly, law firms will need to keep a pulse on their clients and competition. With many solutions to choose from, a closer look at the strategy and financial strength of newer vendors may be required.

Are some vendors too early to the AI party? Are other vendors that appear late to the party actually right on time? Is the Chasm wide? Or is it small and manageable? Only time will tell!

Ken Crutchfield is Vice President and General Manager of Legal Markets at Wolters Kluwer Legal & Regulatory U.S., a leading provider of information, business intelligence, regulatory and legal workflow solutions. Ken has more than three decades of experience as a leader in information and software solutions across industries. He can be reached at ken.crutchfield@wolterskluwer.com.

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