Mai Chen: Technology rules, but it still needs people

My visit to Google was part of a trip that produced insights into the rapidly changing world of information technology.

I fly back from visiting Silicon Valley at 6 this morning. I have been getting professional inspiration and a better understanding of where the new disrupters will come from that will pose challenges for law, policy and business, and the legal profession.

We already know about Google Glass, 3D printing and wearable technology, but what about the transformative things we don't know about? How is the world about to change?

Twenty years ago this month, Chen Palmer was established as one of New Zealand's first boutique law firms. It was the first "Washington-type" law firm in Australasia to practise public law mainly for private sector clients interfacing with the government.

Until then, public law was primarily the domain of lawyers working for the government although lawyers in private practice did go to court to judicially review the government.

Many suggested that we might not get enough work if we specialised in public law. But we had travelled to San Francisco before establishing the firm and found that even very large US law firms specialised only in two or three things.

When people needed help, they wanted the top expert in tax law or commercial law or intellectual property; and the branding is that much clearer in a boutique versus a full-service firm.

That was 20 years ago, and just as we have added employment law to our specialisations, the practice of law in New Zealand has exploded with a proliferation of boutique firms, mainly spawned from bigger firms. Today the market is full of legal specialists, including public lawyers in private practice.

Twenty years later, I am back in San Francisco deriving fresh professional inspiration, and where better to do that than in Silicon Valley with an NZ Global Women group.

Silicon Valley is no longer a place but a global network. I have been getting an inside look into Twitter, Google, Stanford University, but the standouts are great New Zealander entrepreneurs like Linda Jenkinson, global CEO of Les Concierges, and Sean Gourley, global CEO of Quid talking about artificial intelligence (machines), collective intelligence (wisdom of the crowds) and augmented intelligence (amplifying human cognition).

My visit confirms that information is the standout area of rapid change and challenge, especially in balancing privacy interests against access and the value of aggregate data.

Data is power, and the rapid development of artificial intelligence (AI) software capable of interrogating and processing that data will have a devastating impact on the traditional professional services firms such as lawyers, accountants, consultants and financial services providers.

The old model of "leverage" where large amounts of data are read, synthesised and analysed by a small army of junior to intermediate staff, and the resulting product considered by senior staff who then decide how to advise on that information, will not match the cost effectiveness or firepower of computers and AI software.

The days of "traditional" professional services firms are probably numbered. But the human element will not disappear.

Studies show that "centaurs" -- chess players whose decisions are made by human grand masters and computers in concert -- out perform AI-only chess players by as much as 16 per cent.

Similarly, future professionals will have to be adept at manipulating "Big Data" and in asking artificial intelligence software the right questions to access the data they need to make decisions for their clients.

The main value-add by lawyers will be their intuition and strategic insight. The best advice may sometimes be illogical and based on gut instinct from many years of arguing similar cases, and seeing how things have played out before government, in Parliament and in court.

The future will belong to highly specialist firms adding value at the top of the information mountain and the decision-making chain. Smaller firms can match the firepower of bigger firms. And so can lawyers at the bar if their chambers has access to AI software.

The adoption of Big Data strategies by professional services firms is inevitable. Those firms which do not do so will be unable to compete effectively with firms that have adapted.

AI software will affect the entire economy and the choice for professionals is between keeping up with the wave or being left behind.

This raises questions about who will train junior lawyers to get to that level of expertise when they can't cut their teeth on work that computers can take over, and whether judges will also use AI software to write their judgments and to check the submissions made by lawyers using AI.

The only sure thing I learned about the future is that Darwin was right when he supposedly said: "It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change."

Adaptability, creativity and imagination are the keys to survival for professional services firms in the 21st century.

And with the increasing pace of change in a world connected by the internet and social media, creativity and imagination are as important as technical skills.