Legal and professional services firms are experiencing a watershed moment in their industries. From artificial intelligence (AI) woven into contract analysis and automated discovery processes to virtual client consultations and analytics, there are several ways technology can help drive law organizations forward.
However, law firms and legal departments must make a decision (as with any technological advancement): either embrace innovation or risk being outpaced by competitors that invest in AI and other emerging technologies. In addition, factors such as rising operational costs, talent shortages, and changing client expectations underscore the need to integrate innovation into the strategic goals of professional services firms.
But, where to begin? There are dozens of AI tools available for individuals to use. How can an organization start from the ground up and build a culture of innovation that balances efficiencies with professional standards?
The following is a road map detailing the benefits of innovation in the field of law, risks to consider, and how to build a culture of innovation at your firm that incorporates AI use appropriately and ethically.
How Innovation Can Benefit the Legal Profession
Technology can help firms restructure their legal service delivery and business operations. According to the American Bar Association (ABA), attorneys increasingly use AI to assist with more than legal work.1 Of 2,800 legal professionals surveyed in its 2025 Legal Industry Report, the ABA reported that 54% of participants use AI to draft correspondence, 14% use it to analyze firm data, and 47% expressed interest in tools that assist obtaining insights from a firm’s financial data.2 AI can also assist with legal research, flag relevant precedents in seconds, and accelerate case timelines.
Forward-thinking firms can embed AI and generative AI (GenAI) into daily workflows, helping legal teams save time spent on manual or repetitive tasks and reduce errors through streamlining document reviews. Doing so also provides legal professionals with the opportunity to unlock measurable cost savings. For example, automating document review and billing can reduce staff workload by several hours per month, allowing teams to refocus time and energy on strategic tasks like litigation planning or client development.
In addition to this, key findings in the 18th Annual Professional Services Maturity™ Benchmark Report from SPI Research showed that firms leveraging AI for resource planning and automation outperform peers, while data silos hinder real-time decision making.3 This reiterates that AI and data visibility across a firm can be key differentiators for organizations.
Thus, innovation goes beyond personal productivity: a culture of innovation helps to support the firm’s back office and boost efficiency, profitability, and cost savings.
Prioritizing Risk Mitigation in Legal Practice
In July 2024, the ABA published guidance on ethical issues raised by lawyers’ use of GenAI4 (noting that ABA, state, and local bar associations will likely update their guidance as GenAI tools evolve). The statement mentioned that lawyers using AI must “fully consider” their ethical obligations when using GenAI, including:
- Providing competent legal representation
- Protecting client information
- Communicating with clients
- Supervising employees and agents
- Advancing only meritorious claims and contentions
- Ensuring candor toward the tribunal
- Charging reasonable fees5
With this in mind, risk in the legal field spans data security, compliance, malpractice exposure, and reputational harm. Innovative technologies can help mitigate these risks by improving accuracy, transparency, and oversight. For example, AI-powered tools can flag inconsistencies in contracts, monitor regulatory changes, and assist with compliance audits. Data analytics and legal tech platforms can also support better risk assessment by identifying litigation risks.
These instances are advantageous at first glance, though there are broader risks for law firms to consider. In 2023, a judge imposed sanctions on two New York lawyers who submitted a legal brief that included six fictitious case citations generated by ChatGPT.6 Over a year later, a Texas federal judge sanctioned an attorney for submitting a court filing containing nonexistent cases and quotations generated by AI.7 These high-profile examples reiterate the importance of oversight and caution when adapting to technology trends at your firm.
Three Steps to Build a Culture of Innovation
As outlined above, AI can be an asset when it is used to aid an attorney, rather than replace them. When building a culture of innovation, strive to adopt and implement these technologies in your organization mindfully.
Step One: Create
A firm’s foundation should include a culture of innovation that empowers legal professionals to challenge the status quo. This involves encouraging experimentation with new legal tech tools, creating safe spaces for attorneys and staff to propose and test ideas, and breaking down silos between legal, IT, compliance, and client service teams.
A trickle-down approach is beneficial during this initial phase: leadership can and should model this mindset. When partners and senior counsel champion innovation, it signals that change is not only accepted, but expected. Training and development are key to helping teams remain informed and current with relevant, emerging tools and best practices.
Recognizing and rewarding innovative thinking, whether it’s a new client intake process or a more efficient way to manage discovery, reinforces a culture where creativity is valued and nurtured.
Step Two: Construct & Align
Constructing an internal innovation team signals that innovation is a strategic priority. This dedicated, cross-functional group can act as the driving force behind initiatives and help create value through new ideas.
The innovation team should align its efforts with core business drivers and success metrics. During step one, leadership models the innovative mindset. In step two, they are tasked with focusing their efforts on areas that will impact business success and growth.
For example, consider investing in enhanced client portals, more virtual consultations, or AI-powered communication tools if client satisfaction is a key business driver.
Innovation without a clear purpose can be a costly distraction. Connecting your initiatives to key business drivers can help ensure that the innovation investment can yield measurable improvements.
Step Three: Cultivate
With these markers in place, the third step is to sustain your organization’s innovative culture through collaboration and ongoing curiosity. Executives and innovation teams must ask open-ended questions that uncover the culture’s basic why, what, who, how, when, and where. This feedback encourages cross-functional collaboration and reveals where innovation can make the greatest impact.
Firms that exhibit active and intentional listening will naturally collaborate and create channels for ideas to flow throughout the organization, helping innovative initiatives reach their desired business value.
Another piece to the culture puzzle is tracking progress of the work. Financial law firm key performance indicators (KPIs) such as billed revenue, use of the average collection period formula, overhead ratio, revenue per lawyer calculations, and firm debt8 are areas that can be assessed for progress and productivity.
Embracing the Future of Law Through Innovation
Growth and success in the legal profession require an openness to change. Innovation doesn’t need to be intimidating: an adaptive perspective may attract clients seeking firms that embrace change, as well as the next generation of legal professionals, especially Gen Z and Gen Alpha, who are uniquely attuned to technology and data-driven decision making.
Firms that explore innovation and weave it into their culture can do so by balancing efficiencies with their professional standards and goals. Ultimately, innovation and digital transformation can help mitigate risk, provide cost savings, boost productivity, and set up a firm for sustained growth and market leadership. If you have any questions or need assistance, please reach out to a professional at Forvis Mazars.
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- 1“The Legal Industry Report 2025,” americanbar.org, May 6, 2025.
- 2Ibid.
- 3“The 18th Annual Professional Services Maturity™ Benchmark Report,” spiresearch.com, February 12, 2025.
- 4“Concerns and legal issues surrounding AI,” legal.thomsonreuters.com, July 29, 2025.
- 5Ibid.
- 6“New York lawyers sanctioned for using fake ChatGPT cases in legal brief,” reuters.com, June 26, 2023.
- 7“Texas lawyer fined for AI use in latest sanction over fake citations,” reuters.com, November 26, 2024.
- 8“Five Financial Law Firm KPIs: Measure & Improve Performance,” forvismazars.com, September 9, 2024.