“In-house lawyers have to become part of the product development. Right now, lawyers and legal departments are non-manufacturing costs, and that is not where you want to be when a company is restructured, but if you go to the manufacturing costs, a lot of good things can happen.“
Such was the message from Senior Legal Counsel in Signify and Professor in Business & Financial Law at Tilburg University, Erik Vermeulen, when he concluded Experticon's Legal Tech Conference in Copenhagen a few weeks ago. Whereas lawyers became business partners in the 2010s, his prediction for the upcoming decade is that legal professionals will become integrated parts of the product teams when IOT-products are developed. But will it imply that lawyers should learn how to code new software? Or which skills will be required to improve the basic tech literacy of future lawyers?
If this, then that - To think like a coder
Initially, Vermeulen started a course called Coding for Lawyers. That wasn’t a great success: “Firstly, the coders hated it because they thought; can you really teach them how to code in 3 months? For us, it takes 4 years. Secondly, I can maybe teach you how to code, but if you don’t do it every day, in a couple of weeks it’s gone,” he says.
Instead, he realised that lawyers must get aquatinted with the if-this-then-that logic that is applied in digital technologies: “We don’t have to know the language but what we have to understand is how programs think. We have to understand problem-solving, which is what we do in real life. Now, we don’t write contracts to solve problems, we write instructions.”
Vermeulen has hands-on experience with this approach from his work in Signify where they have decided to meet the future with open eyes, head first: “We wanted smart contracts and blockchain in the supply chain, so we did an experiment. First, the coders worked, then they talked to the lawyers. The first question, we asked them was, what happens when a light bulb is broken? And they answered: ”Well, the money will return.“ So we asked them where the mistake was made. Was it in manufacturing, in transport? ”Ups, we didn’t think about that.“ So here we see how lawyers and coders can create a lot of value together. We have to understand how they think, and man, magic happens! We have to think like this: If I go to the gym today, it’s pizza for dinner. Otherwise, it’s salad.“
Inhouse lawyers as future regulators
Vermeulen’s speech was futuristic, and he maintained a very optimistic, constructive view on the future of law. He highlighted the many opportunities modern technologies bring about, while also acknowledging the many challenges. But what was even more striking was his almost fatalistic response to the technological development. A connected world of artificial intelligence, blockchain and internet of things was not treated as something you can argue with. It’s a condition, a fact that lawyers will have to deal with whether they like it or not. He went past the discussion of if the transformation will happen to the legal profession if artificial intelligence will have an impact. Instead, he imagined what the lawyer of the future of law will look like when it is fully evolved.
Such an open-minded approach to the future is a general trademark of in-house lawyers working in innovative and technological minded companies. And Vermeulen did, in fact, share some interesting experiences from Signify (formerly known as Philips Lighting) and how they have adapted to the new technological reality. Whereas they used to sell lightbulbs, they now sell light as a service: “When we sell light as a service, we want to give really good service to our customers. We need data to make personal light services, so the Phillips business model changes,” Vermeulen says.
He expects exponential growth in the importance of artificial intelligence as the connectivity of innovations like machine learning, blockchain, 5G, improved sensors and the internet of things will accelerate and amplify each other to cause a dramatically steep curve in the efficiency of these technologies. So while the legal industry might now feel the same urgency to innovate as the light industry, there is no doubt about the end result.
This development will make lawyers obsolete for most traditional legal tasks, but according to Vermeulen’s speech, it will also create a new demand for lawyers to participate in the regulation of the very same technologies. So far, he is not impressed with how the regulators have approach artificial intelligence and he particularly singled out European Commissions’ principles for the development of artificial intelligence for being too vague.
“Maybe governments might not be the best place to regulate. Maybe the companies themselves should come up with the best solutions. We as lawyers might become the next regulators, as the current regulator is just there to provide context. Many will ask “Will companies actually do that? Well, yes, there is research out there which shows that consumers are willing to pay more for a secure product that takes care of your privacy compared to a cheaper one that doesn’t,” Vermeulen said.
So far, the tech-industry has not always been very good at self-regulation with the Cambridge Analytica scandal as the most prominent example. But with more lawyers in the product development teams, Vermeulen might have a point. However, it requires that lawyers are willing and able to reinvent themselves: “We have to become digitally-savvy, understanding AI, IOT and the new world. This means, we have to become the so-called t-shaped lawyer. The T-shaped lawyer has deep legal knowledge but also understands business and technology. Be creative and complex problem-solving. If you do this, you will be in a good shape. But we have to start now,” Vermeulen concluded.