The key to law firm innovation? Your people

​The legal sector is experiencing one of the most significant shifts in its history, driven by technological advancements, changing client expectations and the layers and expectations of multi generational teams.

In order to adapt, law firms may need to evolve and innovation is a big part of that.

Innovation is no longer a “nice to have.” It’s becoming a competitive differentiator.

Clients today expect faster delivery, more transparency, cost predictability, and services designed around their needs - not the firm’s internal processes. Many are also beginning to question how AI influences pricing models and the value they receive.

At the same time, AI and digital tools are transforming how legal work can be done. Research tasks, document review, and due diligence can now be automated or augmented in ways that simply weren’t possible a decade ago.

It’s not enough to make a token gesture towards embedding new technologies. To truly evolve, law firms must invest not only in tools, but in people.

Innovations of the legal industry

Like most industries, the legal profession is experiencing a period of change like no other.

Rapid technological developments have not only made day to day working different but it’s broadened the scope of many legal and business professionals. It’s now expected that M&BD and finance & accounting professionals should contribute to business strategy, regulatory changes, emerging technologies and global market dynamics.

Clients expect far more from their legal team on a far broader range of issues than ever before. For legal and business professionals it might mean stepping outside of their silo, more collaboration, more complex queries and a far bigger challenge to meet client expectations.

This shift in expectations requires a fundamental change in mindset. People must be willing to learn continuously, challenge long-held assumptions, and become more comfortable with change.

Traditionally, these aren’t qualities that are explored in the hiring process - with the focus far more on qualifications and direct experience.

At some point, the firm needs to make a deliberate decision to evolve its hiring approach, whether that means introducing new interview questions, redefining evaluation criteria, or rethinking where and how talent is sourced.

The only way to find the right new talent is through consciously looking for it, and that won’t happen by chance.

For some firms, this will require a shift from the status quo. It may mean rethinking long-standing hiring practices - whether formalised or not.

Without intentionally defining the qualities they seek in new hires, such as adaptability quotient, (somethingI recently explored as part of a panel at high tide) forward-thinking and problem-solving, firms risk falling behind. Those that continue to recruit solely on traditional criteria will struggle to keep pace with competitors who are actively building more agile, innovative teams.

Curiosity and innovation

We’re in the middle of an AI-revolution. Everywhere we turn there’s a new tool making grand promises to change the way we work. The flipside of that is the myriad of ethical and legal considerations which we’re only just starting to learn about.

Law firms will find themselves leading these conversations, if they aren’t already involved. The only way to navigate these new challenges is through curiosity. It’s the individuals who are curious and learning in their own time about these technologies and their impact who will be ready to lead those conversations when asked.

87% of those in legal professions predict AI will significantly impact their professionin the next five years. AI proficiency will become the way to identify great legal talent from good, with those that show no interest, struggling to progress their careers. It’s not simply down to technical ability, but the curiosity, innovation and way of thinking that AI brings to the table.

If firms fail to attract talent that values self-development and curiosity about emerging tools and approaches, they will quickly find themselves excluded from the conversation. This matters even more with Generation Z, who consistently highlight learning and development as one of the main reasons they choose, and remain with, a firm.

Clients are already seeking advisors who understand and can leverage new technologies. Firms that cannot offer that level of insight and capability risk seeing their clients turn elsewhere for the guidance and support they need.

Forward thinking talent

Forward-thinking firms will naturally attract forward-thinking people, just as a strong culture attracts individuals who align with it. The stance a firm takes on innovation and AI sends a powerful signal about what it values.

If firms want to attract and retain the kind of talent that drives meaningful change, they must demonstrate that same openness and future-focused mindset themselves. Innovation can’t just be stated as an aspiration - it needs to be visible in the way the firm works, learns and evolves.

That might start with evaluating what people you currently have and what skills you’re lacking. The legal industry can be quite traditional in its approach, when it comes to embracing change that could be a disadvantage. In order to keep pace with tech changes that are happening now, it might mean widening your talent pool and looking to hire those from outside of legal.

A&O Shearman recently attracted attention when they published a Global Head of AI BD role with the sole purpose of driving growth and shaping the future of their AI client proposition. It garnered attention because it hadn’t been done before, it was new and it’s pushing the limits.

Other firms need to take note and look at how AI can fuel their growth and what people they need to get them there. There are steps firms can take to become more forward-thinking in their approach, the question is are they brave enough to take that first step?

Culture and retention

When it comes to finding the right people to help drive forward thinking in the firm, they might be closer than you think. It’s easy to think the answer is always to bring in new hires, but retaining and cultivating your existing team is a far more effective method.

Ultimately, it all starts with culture. Firms must be able to clearly articulate what their culture is and communicate it consistently across the business. Without this, teams are left to fill in the gaps themselves, leading to confusion and the “grass is greener” mentality.

To do this effectively, senior leaders need to acknowledge that there may be a gap between how they perceive the firm, how clients experience it, and how employees feel about it. Recognising that gap is the first step toward building a culture that people genuinely want to be part of.

A strong, clearly defined Employee Value Proposition (EVP) is the foundation. It communicates what makes the firm unique and outlines the rewards, development opportunities, and working environment it offers. Culture, values, and mission sit at the core of a meaningful EVP and this is where forward-thinking really matters.

Firms must show a genuine commitment to innovation, not only in what they say but in what they do. It’s not enough to claim that technology is a priority if teams are still battling outdated systems or inefficient workflows.

To attract and retain the right people, firms need to “walk the walk” - demonstrating through everyday actions, investment decisions, and internal practices that innovation is more than a talking point.

It’s these small changes and initiatives that signal to employees but also clients that the firm is taking technological changes seriously and are prepared to assist them in navigating the changes.

Firms need to look to the future and embed that forward thinking into every stage of their business. From processes, to technology, to their culture, to their hiring practices, to their people.

Embedding innovation and curiosity at the heart of the firm is key to understanding what these technological advancements mean for both their firm but also their culture. It’s also the key to attracting and retaining the right people.

After all, it’s people that are going to drive change further and empower firms to become the go-to resource for all ethical and legal implications that AI in particular brings with it. Without the right people there’ll be no innovation, and without innovation firms will struggle to keep pace.

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