Reshaping the legal industry – document automation & ALSPs in an era of AI

AI is fundamentally reshaping the legal industry, transforming traditional business models and driving significant changes in how, where, and by whom specific tasks are carried out.

Alternative legal service providers

AI is accelerating the outsourcing of routine legal work. Just over half of respondents (51%) already anticipate that tasks such as legal research, document automation, and contract drafting will be increasingly reallocated to Alternative Legal Service Providers (ALSPs).

Encouragingly, legal professionals express growing confidence in their organisations’ ability to adapt business practices, service offerings, workflows, and pricing structures in response to AI‑driven efficiencies. According to the survey, 61% of respondents believe their firms are prepared to make these adjustments.

From billable hours to alternative fee arrangements

Nearly half of law firms (52%) report revenue growth of 6–20% following the adoption of AI. Within this group, 19% cite revenue increases of 11–20%, while 30% report gains of 6–10%. This highlights the tangible impact AI is already having on legal workflows and commercial performance.

Moreover, 62% of legal department respondents expect AI‑driven efficiencies to significantly reduce reliance on the billable hour, paving the way for alternative fee arrangements and improved cost transparency.

However, the long‑term impact of AI on legal business practices continues to evolve. “The more a firm emphasises the broad application of AI tools, the more it may naturally prompt clients to demand higher service efficiency, reduced billable hours, and greater substantive involvement from senior lawyers,” said WEI Xin, Founder and Managing Partner of RICC & Co. and Council Member of the Shanghai Bar Association.

Legal service providers landscape

As ALSPs take on a larger share of routine legal work—such as research, document automation, and contract drafting—traditional firms may face increased pressure to adapt. Firms and legal departments that are willing to re‑evaluate long‑established workflows and invest in continuous learning will be well positioned to deliver client value in new and innovative ways.

“Resilience and adaptability will be critical, especially as the industry responds to shifting client demands. Legal professionals will require new ways of working that allow them to move at the same pace as their industry, with solutions that combine advanced technology with unparalleled insight,” said Martin O’Malley, CEO, Wolters Kluwer Legal & Regulatory.

To read the full legal‑industry AI analysis, download the 2026 Wolters Kluwer Future Ready Lawyer Survey Report >>