How AI-enabled legal managed services are redefining the relationship between in-house counsel and firms
A new keystone to strengthen your legal department
A keystone is an architectural element that provides strength and stability to an arch, serving to keep the other stones in place and the structure together, even while bearing considerable weight.
An in-house legal team acts much the same in a large, complex business. It provides the strategic legal advice, contractual oversight and risk management framework needed to stabilize the whole organization and ensure it stays strong as it strives to reach its goals.
But in-house teams increasingly perform this essential, stabilizing role in difficult—and rapidly changing—circumstances. New compliance obligations, cross-border requirements and industry specific mandates emerge constantly. In-house legal teams typically carry a heavy workload and are struggling to balance high-value, strategic priorities they need to focus on with the high-volume, day-to-day work that is also required.
Just as the legal department is the keystone in the structure of a business, so too can legal managed services (LMS) provide this steadying function to in-house counsels and their teams. Traditional LMS offerings are faltering as requirements of legal teams are increasing. With a relatively narrow scope and lack of embedded legally qualified oversight, non-law firm providers are limited in the extent that they can support the demand placed on today's legal departments.
That's why partnering with experienced legal advisers and embedding their knowledge and knowhow into managed services is so important. A new range of LMSs, operated by global law firms, overlayed with insights from their lawyers' deep legal understanding and underpinned by AI capabilities, are upending the traditional models.
This gives clients access to the broad benefits LMS can deliver in increasingly complex and challenging areas — as advancements in AI solve for the high volume non-complex work supported by traditional LMS capabilities, this next evolution of LMS offering can solve for far more complex and strategically important workloads, efficiently and at scale.
Partnering, not outsourcing
The greatest value comes from providers who can embed and fully integrate themselves and work seamlessly within your organization, aligning with your business objectives and providing legal and commercial insights not available through providers of less-comprehensive services.
Partnering with you and designing with the end in mind
Every client has unique needs, and goals.
A law firm that provides LMS can tailor a bespoke, end-to-end service, or help you select from a range of discrete services best suited to your specific needs and goals. Importantly, the service underpinned by deep legal experience can go materially further on the spectrum of complexity.
Experienced lawyers work hand in hand with legal transformation consultants to identify gaps and inefficiencies in your current operating model and customize a solution that goes beyond simply filling those gaps to develop a scalable legal services platform to support the future growth of the organization.
These multidisciplinary teams then design, build, customize and deliver managed solutions that can handle large and complex portfolios of legal work — blending together the right depth of technical legal capability and legal operations support, supercharged by an AI-enabled delivery engine that embeds both assistive and agentic AI capability to deliver efficiently and allow for scalability.
This includes added benefits, such as knowledge transfer and guidance on technologies and best practices to help upskill your team, as well as reviewing and improving relevant contract templates, playbooks, operating procedures and governance and reporting frameworks, to ensure they are flexible enough to evolve with your business.
In addition, partnering on LMS with a law firm creates important synergies. Lawyers have professional obligations to uphold, as well as experience with handling unforeseen regulatory and compliance issues that could arise in carrying out work for the client—including across a wide range of jurisdictions. Any such issues can be quickly identified and appropriately escalated without handoff to another provider. This means the client can have added confidence in the seamlessness the service and that it can deliver against the more routine day-to-day legal workload, as well as any unforeseen, complex challenges that often arise.
We have worked with a wide range of clients on complex solutions to their challenges, such as:
- Handling high-volume complex trading activity: Designing, building and running a multi-year managed service solution to various global investment bank clients trading high volumes of complex derivatives and structured products. Through deployment of a client-facing workflow platform, leveraging AI to enhance drafting efficiency and implementing robust process and governance frameworks, we deliver thousands of complex trade documents a year against aggressive deadlines and exceptionally high-quality expectations. This complex legal work, delivered at scale, is only made possible through the combination of global law firm capability, deployment of cutting-edge AI and a network of global delivery centers working together.
- Effective data governance and regulatory response: Designing and implementing a centralized, tech-enabled governance model, with a single repository, structured workflows, and a comprehensive playbook to standardize document handling, reviewing and reporting. This was in response to a high volume of regulatory notices the client was contending with across multiple workstreams, with fragmented processes and inconsistent coordination between internal teams and external advisers, limiting their visibility, control and accountability.
The value of a strategic partnership between in-house counsel and legal-led managed services providers
The widespread adoption of generative AI tools has placed in-house legal teams under added pressure to move up the value chain in the work they externalize by way of a managed service, as low-complexity, high-volume work can increasingly be done effectively by AI. But the legal knowhow, commercial acumen and nuanced human judgment of lawyers is not easily emulated and cannot be commoditized. In addition, in-house legal teams are responding to business imperatives to boost innovation, uncover added value through providing insights into options for the business, and at the same time use AI effectively to handle complex projects while being able to demonstrate a return on investment in this new technology.
This means in-house legal teams are focusing increasingly on highly-complex work, and need more-sophisticated support than what traditional managed service solutions can provide.
Legal-led offerings are well placed to respond to the need for deeper insights, and more-strategic advice, since they are carried out by experienced, commercially astute lawyers with deep technical skills who are adept at using the whole suite of new legal technologies available.
An external law firm working in partnership and understanding the business—but with its own unique, external perspective—can provide the in-house team with insights across relevant areas of law and jurisdictions the business operates in that might not otherwise be easy to surface internally.
Just as the value of a keystone is in strengthening the whole structure, the value of a well-executed partnership with legal-led managed services providers is in the solid results it can provide to in-house legal teams, as they bear considerable weight for their own organization.
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Author: Alan Angell, Global Head of Legal Managed Services
