Clients Have Major Influence on Law Firm Legal AI Decisions

We’ve all heard the line that it’s the kids who choose your family car and that ‘pester power’ sways your decisions. Now, Litera has found that just over half of law firms are picking their legal AI tools under the ‘direct influence’ of clients.  

Litera’s survey found that: ‘Fifty-one percent of respondents report that a client has directly influenced an AI investment decision in the last 12 months, and only 15% describe AI investment as still entirely internally-driven.’

And that’s very significant. It also shows an interesting circular relationship between legal AI companies marketing to inhouse, who then do their own ‘marketing’ to the law firms on their decisions.

Reinforcing this, they also found that ‘85% of law firms are already feeling or expecting direct client pressure on their AI strategy’.

So, clients are saying they want you to ‘buy some AI’, and also telling you which one to choose. Hey, who needs law firm legal innovation teams if you can just outsource the whole thing to GCs?  

They also found – without any surprise whatsoever – that ‘ROI ranked last [as an issue, and that] the value story that resonates is time recaptured, not cost avoided’.

Why? Because the last time we all checked, law firms were just businesses the same as any other and trying to make as much money as they can, and AI helps them shave off the unprofitable stuff they can’t bill for, or can’t bill much for. So, it’s all about ‘time recaptured’, i.e. getting more billable time, or simply put: a way to make more dosh. And why not?

—

Also, in another survey this week, this time of the UK legal market, but more general in nature, Thomson Reuters found that law firms are using AI less broadly than their clients.

See here: ‘35% of respondents from UK law firms report organisation-wide AI usage compared with 53% of those from corporate legal teams’.

(Note: their sample was very wide, and not just the top firms.)

Of course, this could be because an inhouse team is usually way smaller than their external advisers. Plus, inhousers don’t have to worry about efficiency causing financial issues for them, so no need to worry about usage.

Legal AI ROI also remains something of a mystery for everyone, they found.

TR said that in the UK: ‘[Only] 18% of respondents from law firms and 12% of those from corporate legal departments say their organisations track the ROI of AI tools.’

Law firms obviously cannot really show true AI ROI, they can only show where the tech has removed unbillable work (as referenced above) so they can then focus on more billable manual work; so why even bother with the analysis?

And inhouse teams, also as noted, are relatively small and probably don’t have the spare time to figure out such calculations. They also may not be using AI that much either, even if they have bought some tools.

And finally, they found that ‘43% of UK GCs mention technology and automation as a strategic priority. Up from 25% in 2025’ – which is to be expected, although it’s good to see even if the only measure that really counts is how far you’ve actually redesigned the majority of your workflows with AI as the central driver and have moved to a new way of operating. How many have done that so far…? A tiny, tiny number, one would estimate. Maybe……none…?

What does this all mean?

Overall, what this data shows us is that law firms ignore client sentiment towards AI at their peril. However, as AL explored yesterday, (see story here), despite all the headlines many inhouse teams are really not making deep and really meaningful use of AI tools, even if they’ve onboarded some.

This seems like a paradox. Many inhouse teams are telling law firms what to do and what to buy, but perhaps only have a relatively light commitment to using AI themselves, even if it’s broad. I.e. think puddle, rather than Mariana Trench.

So, why don’t law firms tell the clients to mind their own business? Well, in a more regular social environment that might happen, but we cannot ignore the marketing aspect here. If a client who pays you $100,000s per year, or even $ millions, in fees says ‘Why don’t you bring in X tool?’ then you have a great incentive to do so. Never annoy the client – that’s the cardinal rule, right? Even if they could be wrong…? Well, let’s see.

One last point: for years, law firms have toyed with the idea that it is their job to advise clients on what legal tech tools to buy. The tables have clearly turned. Of course, are clients always using their influence in a way that helps the law firms to make the right choices? Hmmm, we shall see in a couple of years…..when perhaps law firms are lining up at the ‘Returns Counter’ and pledging not to listen to their clients again… 🙂

—

More about Litera here, and more on TR here.

—

Legal Innovators Europe Conference – in Paris – June 24 and 25

And if you found this interesting, then come along to the Legal Innovators Europe conference in Paris – June 24 (Law Firm Day) and 25 (Inhouse Day).

Express route to your ticket here.