In a 2017 Deloitte analysis of the retail industry, Rodney Sides writes: “Spotting disruption before it occurs is difficult. Few companies even know what to look for. Companies must be vigilant; certain risks can attack the basis of competitive advantage, and undermine performance.”
Have we seen this before? Oh yes.
As many of us over a certain age will remember with excitement, the original file-sharing company Napster went online in May 1999. By October, it had 4 million songs. And by March 2000, the Napster community numbered more than 20 million. (The Guardian). Meanwhile, faced with this revolution in the way people accessed and listened to music, (otherwise known as “free”) — the music industry was at first silent, and then decided the best approach was to sue.
Fast-forward to today and you see the same massive disruptions and the same willful blindness taking place in many industries. Let’s talk about retail. I’m pretty sure I don’t have to quote many stats here because you can see the proof on your street, in the malls (if there’s still one in your neighborhood), in the news or perhaps most telling, by counting the number items you’ve ordered from Amazon in the past year. Just for fun, though, here is one stat that sums up the state of the retail industry quite nicely: In 2017, Payless, Radio Shack, Crocs, Kmart, American Apparel, Macy’s, Guess, Sears, The Limited and several more, will close 3,591 stores, according to Forbes. Oh, and while retailers shutter their empty, dusty shop, Amazon is planning to open a “warehouse” in the cloud.
What does this have to do with artificial intelligence? Or law? Well, first things first. According to the same 2017 Deloitte report, “AI is at an evolutionary tipping point and already much more embedded in our daily lives than most people think. Consumers currently encounter elements of purposely designed AI in their daily lives by using voice-activated virtual assistants… voice recognition software to find restaurants, provide directions, play music or make suggestions for lifestyle changes. Tech-giants [are] expected to push the technology into the market at ground-breaking speed.”
So retailers who refuse to adapt new technology are closing and those that do adapt have to keep adapting because technology and habits and demands constantly evolve. Companies who don’t have the people in place to SEE what is in front of them will close. And clearly, there is no store too big to fail.
As for what this has to do with law, the answer is as obvious as the flag above: Artificial intelligence and other changes related to technology, including virtual law firms, cheap online contract sales, alternative firms, among more, should have already shocked the legal industry into changing their outdated business model. There is an explosion of change going on RIGHT NOW and if this industry does not adapt RIGHT NOW, there will be absolutely, unequivocally no firm too big to fail.