March 6, 2025 - Law firms have historically been slow to adopt technology. On average, they generally invest just 1% of revenues, compared to 3.5% among businesses. Though this may be changing.

Sixty-seven percent of law firms we surveyed last year reported using AI for some amount of process automation. In conversations, we hear firms acknowledge the importance of technology, particularly AI. They are formulating policies, learning how to set guardrails to protect confidentiality, and testing closed-source large language models (LLMs) that do not expose sensitive information to the open internet.

These firms now recognize that technology is the key to staying relevant and maintaining their billings. In this article, we explore two opportunities technology provides to make firms more competitive:

• AI can improve efficiency in specific areas
• Cybersecurity Can Help You Attract New Business

Cybersecurity can help you attract new business

Cybercrime continues to rise, and many law firm clients are tightening their policies regarding who they are able to work with. This is especially true for finance, government, pharmaceuticals, and healthcare organizations, which face stiff regulation and steep penalties for noncompliance. At the same time, nations continue to pass more data privacy regulations. After the EU passed the General Data Protection Regulation (GDPR) in 2016, another 160 territories have enacted similar laws.

The resulting mesh of security precautions and regulatory policies makes the private companies we talk to more risk-averse. To comply with laws and prevent data breaches, law firms must process information digitally and safeguard it against unauthorized access.

Client concerns are not unfounded — 29% of law firms have experienced a cybersecurity breach, which is likely higher considering that many firms have experienced security incidents without realizing it.

Firms that fail to adopt technology or implement robust security protocols risk losing these new clients.

“Cyberattacks are a huge risk. These days, you can’t earn certain work without certain levels of technology. The last thing you want is to be deselected upon rebid because you didn’t have the adequate technology measures in place,” says Kevin Ricci, Partner at Citrin Cooperman.

Using technology and implementing security measures can help you win more clients and potentially increase your billings.

Action: Get a Cybersecurity Audit

Anything digital is now vulnerable. Pair your technology initiatives with equivalent measures to understand your cybersecurity risk level, posture, policies, and response. Contact Citrin Cooperman for a cybersecurity audit today!

AI Can Improve Efficiency in Certain Areas

In the past, software largely relied on attorneys to enter information; now, large-language models (LLMs) can answer questions, generate their own inputs, and save far more time with various conversational tasks.

The technology is still nascent — sometimes, reviewing the AI-generated information takes as much time as it would to produce it — but in some areas, like e-discovery, it already excels. An AI agent can sift through massive volumes of documents to identify relevant information, reducing the time lawyers and paralegals spend on this task. It is also useful in litigation strategy, where it can predict case outcomes, such as how a judge might rule based on historical data.

Using AI for the use cases where it excels — usually mundane tasks — allows legal teams to work faster and more efficiently. It can increase your capacity to handle and bill more work while freeing up resources for complex, high-value, often profitable cases.

Action: Have an Expert Audit Your ERP for AI Readiness

If your firm plans to experiment with AI, you may need to upgrade your enterprise resource planning (ERP) system, case system, and other data repositories. You will need to capture accurate, usable data to train your AI on your datasets, which you will need to differentiate yourself from off-the-shelf offerings. Those auditors can also ensure you are not exposing sensitive information as you use more AI.

Outsource Key Tech Skills You Lack

According to our recent survey, 90% of companies say they must hire outside contractors to access the advanced tech skills they need. This holds true for the law firms we talk to because it is often easier to “rent” than hire if your firm does not already have a culture of technology that would attract the brightest minds.

Outsourcing is also less risky — trained employees can leave anytime, taking their specialized knowledge with them. Our survey found that 40% of companies that train employees on novel technologies like legal AI say they thereafter struggle to retain those individuals.

Outsourcing provides flexibility, allowing firms to access the specialized knowledge they need without committing to the long-term costs and risks of hiring full-time employees. A full-service outsourcing consultancy like Citrin Cooperman can create a customized technology stack and processes based on your specific needs. We can audit your ERP, ensure you have strong security measures, and advise on how to get the best out of your firm’s technology.

If you would like to discuss legal technology, AI, or your financial strategy around those systems, please contact our Law Firms Industry Practice.