As we enter 2026, the firms that will lead the market are those that embed hybrid working between NewLaw teams and traditional legal practice as business‑as‑usual, not a future aspiration. The shift is already happening – and it is accelerating, writes Emily Coghlan and Jenae Webb.
With AI and digital transformation weaving into everyday legal work, 2026 represents a turning point. The real shift won’t come from the technology itself, but from how law firms position people, expertise, and delivery models around it. This is where NewLaw moves from “adjacent” to “central” and hybrid delivery models become key, writes Emily Coghlan and Jenae Webb.
For more than a decade, NewLaw providers – multidisciplinary teams blending lawyers, technologists, and tech-enabled processes – have offered a modern alternative to traditional legal service delivery. But as organisations face unprecedented regulatory scrutiny, increasing complexity and sustained pressure for greater efficiency, law firms that integrate NewLaw and traditional legal practice into a single, collaborative delivery model will define the next chapter.
Here’s why the shift is accelerating – and why firms that treat NewLaw as “optional” risk being left behind.
People and expertise: The power of hybrid teams
For many years, NewLaw was viewed as a bolt‑on – a flexible resourcing pool, a process engine or an efficiency lever. But that understanding underestimates what today’s in‑house NewLaw teams have become. They now act as the connective tissue of modern legal service delivery – blending legal expertise with the experimentation, agility and cross‑disciplinary capability the current environment demands.
NewLaw professionals have spent years building skills that traditional legal training doesn’t cover, but that contemporary practice increasingly relies on data literacy, systems thinking, workflow engineering and design‑led problem solving. These capabilities, once considered “nice‑to‑have”, have become essential in an environment shaped by automation and AI. Many NewLaw teams are now formalising these skills through capability academies, AI‑literacy programs and legal‑tech certification pathways that barely existed three years ago.
Crucially, these teams are not operating at the periphery. They are co‑creating solutions with legal practitioners and working hand‑in‑hand with information security, risk and technology teams to safely deploy emerging tools. They are redesigning delivery models from within, forming the multidisciplinary backbone that enables firms to innovate responsibly.
This blend of expertise gives NewLaw‑enabled teams the responsiveness clients now expect – the ability to pivot quickly, iterate rapidly and “meet clients where they are”, without compromising rigour or quality. It represents a true step‑change in what firms can deliver in an increasingly digital, AI‑driven legal environment.
Client need: A market already in motion
The technology landscape is evolving at pace – and clients are not waiting for law firms to catch up. Many general counsel are already deep in the AI transition, grappling with enterprise‑wide risk programs, deploying governance frameworks, and responding to heightened board‑level scrutiny. At the same time, they are being asked to transform their own legal functions: streamline processes, digitise workflows and deliver business‑ready advice faster.
What clients increasingly recognise is that technology on its own won’t solve these challenges. They need partners who can knit together legal expertise, operational capability, and technology enablement – partners who understand both the legal risks and the organisational realities that come with AI adoption.
This is exactly the terrain in which NewLaw teams have been operating for years. AI is not a disruption to their mandate; it’s a natural extension of it. Workflow optimisation, document automation, data‑driven insights and scalable project delivery are all capabilities NewLaw functions have already embedded into legal service delivery.
Unsurprisingly, clients are turning to these teams for their practical, grounded expertise in assessing which technologies are fit for purpose, where AI can meaningfully add value, and how to deploy these tools safely. This includes not only implementing legal tech and GenAI solutions that solve real business and legal problems, but ensuring those solutions are applied in ways that are risk‑controlled, defensible and aligned with organisational governance expectations.
AI governance: Why NewLaw expertise matters more than ever
Thomson Reuters’ 2025 Generative AI in Professional Services Report shows that 59 per cent of law firms believe GenAI should already be used for legal work. Yet the same research warns that unstructured adoption – without governance – exposes firms to reputational, ethical and regulatory risk.
In parallel, the regulatory landscape for AI use is evolving – a reason why HSF Kramer has developed a tracker to track AI law and policy globally. Australian courts are also raising the bar for AI use in legal practice, emphasising expectations around disclosure, accountability and professional standards and articulating their requirements for use of AI in litigation.
In this environment, the presence of a NewLaw function inside a law firm is not just a competitive differentiator – it is a governance asset.
NewLaw teams bring a deep, practical understanding of workflows, data hygiene, quality assurance, and operational controls. They know how legal work is actually done: which tasks are appropriate for automation, where human judgement is critical, and what risks must be mitigated when AI enters the process.
Crucially, they can design and embed AI governance directly into delivery models. Rather than retrofitting guardrails after issues emerge, they build responsible‑use frameworks from inception – ensuring transparency, traceability, and defensibility from the ground up. With regulators, professional bodies and global supervisory authorities increasingly examining the legal, ethical, and regulatory implications of AI, this integrated capability is fast becoming indispensable.
By combining legal, operational, and technological expertise, NewLaw‑led teams make safe experimentation possible – enabling innovation while protecting professional standards.
2026 as the tipping point
As we enter 2026, the firms that will lead the market are those that embed hybrid working between NewLaw teams and traditional legal practice as business‑as‑usual, not a future aspiration. The shift is already happening – and it is accelerating.
NewLaw teams will sit at the heart of this transformation. They will design the systems, embed the guardrails and enable the multidisciplinary collaboration that modern legal work requires. Their unique vantage point – spanning legal practice, operational excellence, technology enablement, and risk management – positions them as essential to firms navigating AI responsibly.
These capabilities will be fundamental for firms seeking to deliver more responsive, scalable, and client‑aligned services. And they will be critical for supporting clients through one of the most significant shifts that the profession has ever seen.
Emily Coghlan is a partner, and Jenae Webb is an associate director, in Herbert Smith Freehills Kramer’s digital legal delivery practice.
