Artificial Intelligence is the new aphrodisiac for the professional services sector, as well as all senior management teams in the knowledge sectors, writes Tim Austin, head of property management for the North of England at commercial property consultancy Matthews & Goodman.
Managing partners and their senior counsel are excited by the thought of being able to marry the opportunity to offer a faster, better and cheaper service, with the ability to steal a PR march on their competitors and position themselves as a forward-looking early adopter in the battle for talent.
Let’s not forget how attractive a tech-embracing professional advisor can appear to their technology-related business clients and prospects – empathy and all that. To prove their mettle, these advisors quote their higher tech-to-fee-earner ratios in pitches and in all their promotional channels.
But then, just as industrial robots changed the manufacturing landscape across the world, so AI will and is changing the world of knowledge workers. As robots did, AI will and does the ‘heavy lifting’ in terms of tasks normally undertaken by less experienced and less skilled junior team members – and AI does it faster.
Among professional services firms, especially law firms, the traditional business model was junior staff undertaking all the routine, low-value work. In law firms, this included document reviews, legal searches, case law research – while the equity partners focused on senior counsel, strategic advice and higher value work. Hence the traditional pyramid of few senior partners at the top and many junior staff working on high volume analytical work at the bottom.
AI has changed this dynamic. A number of vanguard companies have selected technologies which best suit their market offer. For example:
– Slaughter & May, which advises on a number of mergers and acquisitions, can now analyse target companies in minutes – a task which would have taken hours to do previously
– Allen & Overy have a joint venture with Deloitte and now offer a digital compliance system which helps banks deal with the ever-growing international regulations with which they have to comply
– Linklater uses AI to check client names for banks – a task which used to take 12 minutes per name, but now takes less than 12 seconds
The list of lawtech examples is growing rapidly, as momentum gathers and early adopters are joined by early majority firms. Property companies are a little way behind, but proptech is already being deployed to manage buildings, survey difficult-to-reach-locations, marketing properties provide data and information to improve performance, reduce costs and enhance user experience – from smart buildings to smart streets and smart cities.
But – and it is a significant but – some commentators have argued that removing the opportunity for people joining the profession to learn about the business from the bottom up, will have a profound impact in that they will not fully understand the process when they are in a senior management position.
True, training can compensate for this loss of hands-on knowledge and experience building, but some argue book-learning is not the same as ‘field learning’. No matter how good the learning technology is, they argue it’s not really a viable substitute for getting out on the pitch and kicking the ball in the back of the net – repeatedly.
But perhaps the biggest challenge to the universal adoption of AI is the fact that some knowledge companies do not have deep enough pockets to pay for the purchase, tailoring and introduction of new systems. They might have the desire and aptitude for it, but they cannot afford it and no amount of cost-benefit analysis can cross that Rubicon.
Or, as is quite often the case, they understand the ‘argument’ but are technophobes and fear the unknown. Without wanting to sound ageist, they are probably comfortable with Word, PowerPoint and a mobile phone but these business leaders, who tend to be more ‘senior’ find the adoption of CRM systems, Virtual Reality and Internet of Things difficult. For them behavioural issues cloud their decision about AI adoption.
AI will change the landscape of the knowledge sector. Business models will crumble and new ones will emerge. Jobs will be lost and new ones will be created. There will be a shift from ‘grunt processing’ to more creative consultancy roles. I think they call that evolution.
- Tim Austin is head of property management North at Matthews & Goodman