The four-way split that's reshaping legal tech AI decisions

When 88% of employers are already using AI in the workplace, legal tech teams can't afford to get their investment strategy wrong. Deborah Perry Piscione's new HBR framework shows why the smartest legal organizations have moved beyond build-or-buy to a four-way decision matrix that actually matches how AI capabilities work in practice.

The shift is already happening—IDC data shows only 13% of IT leaders building AI models from scratch, with most augmenting pretrained models with their own data. For legal tech, this means rethinking everything from how we handle sensitive client data to which AI features actually create competitive moats versus operational necessities.

Build when your legal expertise creates genuine differentiation that competitors can't replicate—custom models trained on your specific case law, client patterns, or regulatory knowledge. Buy when the capability is table stakes and vendors do it better than you ever will. Blend when you need control over core legal reasoning but want to leverage external infrastructure for everything else. Partner when you need enterprise capabilities without enterprise headaches, like Domino's did with Microsoft to boost AI accuracy from 75% to 95%.

The practical impact hits legal teams immediately: every AI project now needs a strategic value assessment that goes beyond "can we afford this?" to "does this make our legal service delivery uniquely valuable?" That distinction determines your IP protection strategy, vendor negotiations, and team development priorities. Getting it right means competitive advantage; getting it wrong means expensive operational theater that impresses no one.

It’s Time for Your Company to Invest in AI. Here’s How.

How should companies be thinking about investing resources toward AI capabilities? It’s no longer a question of whether to build their own capabilities or buy them. Instead, they are looking at four different approaches: build, buy, blend, and partner. Organizations should build when the capability represents core competitive differentiation, their data and domain knowledge create unique barriers to entry, long-term cost efficiency at scale justifies higher upfront investment, or intellectual property protection is essential to their business model. They should buy external solutions when speed-to-market is critical, specialized vendors offer superior expertise, or internal development costs exceed long-term value creation. Blending—building some capabilities and systems while buying others—works best when some components require customization while others can be standardized, or when organizations want to maintain control over core algorithms while leveraging external infrastructure. And strategic partnerships are optimal when capabilities are essential but non-differentiating, specialized providers offer superior expertise and technology, or organizations need flexible service models that adapt to changing requirements.

Harvard Business ReviewDeborah Perry Piscione