How can organizations incorporate AI into their workflow?
Ari Kaplan speaks with Steve Harber, the co-founder and managing director of Apogee Legal, which provides customized artificial intelligence solutions that help mergers and acquisitions, regulatory, and legal professionals to assess the risk and compliance issues associated with their contracts and due diligence matters.
Prior to launching Apogee Legal, Harber co-founded DiscoverReady, a leading provider of e-discovery managed services.
This Q&A has been condensed.
Ari Kaplan: Tell us about the genesis of Apogee Legal.
Steve Harber: After we sold DiscoverReady in 2014, we were looking for another market segment in the legal arena where there were high volumes of documents that required review and analysis in a tight time frame. We also wanted to find a market space where new technologies were emerging that could automate the process. After about six months, we settled on contract analysis and analytics because many corporations had tools or repositories where they stored all of their contracts, but they couldn’t analyze them and quickly highlight critical information. We made a bet that we could create a new category of business, which specializes in the development of analytics, built on top of powerful AI engines to solve specific legal use cases for large corporations.
Ari Kaplan: Your approach is to combine artificial intelligence, machine learning, and continuous process improvement with substantive human expertise. Why is the combination necessary, rather than relying on technology alone?
Steve Harber: The software alone is only a small piece of the complete picture. In order to address the issues that our clients are facing, we need to customize the technology and train it to actually recognize their contracts. Then, we create analytics that solve their specific legal problems. This requires a combination of technological expertise and substantive legal knowledge. We also have to add project managers and legal professionals who are capable of utilizing the tools to develop repeatable processes so that we are not reinventing the wheel each time a corporation has a new project.
Ari Kaplan: Why are risk and compliance professionals adopting AI?
Steve Harber: The main reasons are cost, time, and accuracy. No corporation is making money on performing tasks around risk and compliance; this is a pure cost center. It is, therefore, important for them to perform these exercises as efficiently as possible. And, since M&A, due diligence, and regulatory matters are often managed in very tight time frames, speed and flexibility are essential. When you utilize AI to automate the review process, you can adjust as either the deal or the regulatory request changes. You can also prove with statistical certainty that you are finding the right answers.
Ari Kaplan: How does AI apply to M&A matters?
Steve Harber: In many types of M&A deals, it is critical that the relevant contract clauses are analyzed properly. AI tools enable attorneys to perform a very quick analysis, relatively inexpensively, which is, for example, helpful when evaluating an acquisition target. If you decide to pursue the deal, it enables you to be much more efficient and thorough, and when the deal is over, the combined organization has a repository of contracts with the ability to assess and access all of the information they contain.
Ari Kaplan: What are some best practices that you recommend for organizations interested in incorporating AI into their workflow?
Steve Harber: First, clearly identify a use case. Take into account how that task has been done historically, any associated costs, and key recurring problems with that process to develop a methodology or some controls to help gauge success. Second, run a pilot program with a few different solutions to understand how they really work. This will offer a very good sense of the resources required for a successful implementation. Third, speak with references about the necessary infrastructure and staffing. And, finally, leverage the software provider’s professional services team to help create repeatable processes.
Ari Kaplan: How do you see AI impacting the legal industry in 2018?
Steve Harber: I think you’ll see more law firms talking about bringing the technology into their M&A practices and corporations touting their successful implementations in the regulatory and compliance areas, both of which are plaguing many large companies. You’ll also see AI usage in hot areas like Brexit and [General Data Protection Regulation], which will change the conversation from something that’s theoretical or hypothetical, i.e., “Wouldn’t it be nice to bring AI into the firm?” into reality, i.e., “Holy cow, GDPR is a big deal, and if we don’t comply with the regulations properly, we could face monetary and regulatory issues.” GDPR is going to accelerate the utilization of AI and help corporations ensure that they are ready.
Listen to the complete interview at Reinventing Professionals.
Ari Kaplan regularly interviews leaders in the legal industry and in the broader professional services community to share perspective, highlight transformative change, and introduce new technology at Reinventing Professionals.