Value Creation through Cognitive Technologies in Legal Services

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School of Business | Master's thesis
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Date
2017
Major/Subject
Mcode
Degree programme
Information and Service Management (ISM)
Language
en
Pages
69
Series
Abstract
Cognitive technologies are developing more rapidly than ever before. This trend affects also traditional legal service industry, which is based largely on bespoke (custom made) manual work with hourly billing. The business model based on billable hours contains a paradox of productivity – in order to become more productive in terms of billable hours the firm has to become less productive in terms of actual efficiency. This study focuses on the role of cognitive technologies in the value creation of law firms. The study researches how law firms could benefit from cognitive technologies (products of the field of artificial intelligence) even though it seems that cognitive technologies and automation of legal work would be conflicting with the interests of law firms. This leads to the research question: how could business law firms create value with cognitive technologies? The study is broken down into four subthemes: value creation in law firms, cognitive technologies, challenges of using cognitive technologies in legal work, and estimated impact on the industry. The study builds on the theoretical framework of value creation processes of professional service firms by Løwendahl et al (2001). The study is made from the managerial perspective. The empirical research is concluded by interviewing partners and managers of Finnish and Estonian law firms, and other professionals working between law and technology. The results state that there are several ways to create value for the clients of the law firms. These can be categorized around three main drivers: 1) improving service delivery technologies, 2) improving knowledge flow, and 3) redefining constraints and enablers of legal value creation. The law firms can create value to themselves if they are willing to change and align their interests with the inevitable development of technology. The study is a description of its time and gives practical managerial implications how to benefit from the change.
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Thesis advisor
Rossi, Matti
Keywords
value creation, cognitive technologies, artificial intelligence, legal services
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