Deloitte Legal recently published a research report, New Roads to Dispute Resolution, which aims to provide an in-depth look into the factors which have contributed to the rise in business disputes, including which disputes have escalated, how companies are responding and what helps reach a successful resolution
The Report is supported by Deloitte Legal’s first global dispute resolution survey, which attracted responses from senior legal and executive leadership from over 550 companies worldwide.
Amongst the report’s key findings was that digitalisation has made huge strides, with most companies now investing in some form of AI-based risk assessment tools and case management software.
About the survey
Deloitte Legal commissioned Euromoney CS to conduct the survey to analyse litigation activity across a number of metrics. Survey fieldwork took place throughout September 2022.
568 tax, finance and legal professionals working for companies in the Americas, Asia-Pacific, Europe, Middle East and Africa were surveyed. 78% of the respondents were senior in-house legal professionals, such as chief legal officers and their deputies, executive vice presidents legal and vice presidents legal, and general counsel.
Global annual revenues at the companies surveyed ranged from less than US $100 million (3% of respondents) to more than US $3 billion (33% of respondents). Most respondents (64%) worked for companies with revenues from US $100 million to US $3 billion.
One of the key themes which emerged from the survey is that many companies are seeking a technological edge by using AI and other digital tools to help manage and resolve disputes. The survey demonstrates widespread acceptance of digitalisation, with three-quarters of those companies surveyed investing in risk assessment tools to identify litigation that requires reporting or special management, and half of respondents investing in robotic process automation (RPA) to handle volume litigation
Almost every company in the survey was investing in digitalisation (with less than 5% saying that they did not yet), and most were confident about its potential. More than half (59%) – and 70% of CEOs surveyed – believed AI will revolutionise litigation decision-making within five years.
More than half of survey respondents expect that part of that revolution will involve replacing some of the work of litigation lawyers, despite a similar proportion also noting that they have grown their legal department headcount since 2020. One outcome of this push-pull between technology and human talent may be that AI is used eventually to replace repetitive, routine litigation work, leaving in-house and external lawyers free to focus on niche topics and more complex cases.
A majority of respondents believe that AI will make litigation outcomes more predictable and reduce the cost and duration of cases, with blockchain providing reliable evidence in many disputes.
The Americas, represented in the survey mainly by Canada, Mexico and Brazil, appears to be a torchbearer for these trends, with 40% of respondents from the region citing AI platforms as their favourite dispute resolution mechanism.
This does not appear to be the case in Europe, where the more traditional avenues of courts, tribunals and settlements are preferred, but could be a sign of things to come as companies deal with more volume litigation in areas such as consumer protection.
Key takeaways – the disputes tech revolution
The survey results shows that most companies already prioritise investing in litigation-related technology. This is in line with the general trend of investing in legal automation that we see in our legal management consulting projects, as well as the investment in digitisation witnessed over the last few years in the Courts of England and Wales.
Starting from taking a risk-based approach when managing litigation work, to making data-driven decisions and automating repetitive tasks in mass litigations, legal tech is seen as a solution to improve litigation management and help litigators focus on strategic decisions and value-added work.
AI and RPA technologies have made significant progress in recent years. As they continue to improve in terms of training required, languages covered and functionalities, they gain traction, with more and more use-cases using these technologies to help with large volume work.
Most respondents agreed that AI and RPA technologies will play a key role in improving decision-making, reducing the cost and time spent with litigation, as well as predicting with better accuracy the outcomes of a dispute. This trend corroborates the general view that AI and RPA are no longer buzzwords, but opportunities to transform litigation, including in areas such as gathering evidence.
As such, we believe that investment in AI and RPA will increase in the coming years, with a variety of use cases in sight of most litigators.
One thing seems certain – legal technology is here to stay. Those companies which adopt and invest in digitalisation are likely to edge ahead of the competition, and will be able to deal with litigation with greater efficiency and better outcomes.
For more insights on digitalisation, and some of the other key litigation themes identified in the survey, please get in touch with Simina Mut, Lorena Rosia, Rob Griffiths or Ross Keeble.
Content from the Deloitte Legal blog can now be sent direct to your inbox. Choose the topic and frequency by subscribing here.