10 Recurring Themes in the Business of Law and Legal Technology, Part 1

If you work in the legal community long enough, you tend to see the same themes over and over. That’s our observation as we reflect on the last decade and peer around the corner to the next one. In fact, we see so many recurring themes, we can’t fit them all in at once.

Here are just five of the themes that seem to be recurring in the legal community and legal technology:

1) The promise of law firm innovation.

Law firm innovation is one of the hottest topics in legal right now. Some say it’s overhyped, while others argue it’s quite real. The 2018 Aderant Business of Law and Legal Technology Survey, an annual poll we conduct to keep a pulse on the market, found about one-third (30%) of respondents had someone designated with the task of facilitating innovation inside their firm.

There must be a smaller percentage of firms with designated innovators, right? After all, big law firms are laggards. But, that’s not true. We work with a lot of large firms and typically find them to be among the most forward-looking. In fact, in that same survey, the largest law firms were more than twice as likely to say they had an employee in charge of innovation.

So, who is charged with leading innovation in law firms? More than likely, that person isn’t a lawyer, but an allied legal professional. A landmark study commissioned by the State Bar of California supports this idea: the key to “productivity requires lawyers to work closely with professionals from other disciplines.” The study hints at the many changes still to come to the legal industry, which will almost certainly affect the future of innovation in the legal business.

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2) The drive for law firm operational efficiency.

Processes need to be improved over time as conditions change. If they aren’t, it drags on efficiency and saps resources – money, time, and people – from other tasks.

The rise of outside billing guidelines is a good case in point. In some law firms, it has turned the monthly billing cycle into an all-hands battle just to publish invoices. And still, some of those invoices are rejected by client-side eBilling systems, which kicks off a whole other process that consumes more resources.

That’s just one example. Shifting client needs, increased competition, and new competition will place a residual focus on improving operational efficiency. Technology will continue to have a role in automating rote tasks, gleaning better analytics and insight, bringing clarity and transparency with workflow, and enabling more collaborative experiences.

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3) Collaboration changes inside and outside law firms.

The response to client demands has ushered a change to how work gets done inside law firms. Collaboration is a clear illustration of this trend. Nearly half, or 47% of respondents, said who they collaborate with inside the firm is different from five years ago, according to the 2017 Aderant Business of Law and Legal Technology Survey.

The new business of law titles among allied professionals in pricing, strategy, and security are prime examples. These were all rare, if they existed at all, in circa 2008. That’s when the Great Recession caused corporations to scrutinize all their spending, including on legal services, which set off what was arguably the largest disruption the legal industry has ever seen.

Collaboration promises to grow far beyond the boundaries of a law firm’s office. It will be fueled by the cloud and include clients, partners, and suppliers of legal support services – extending to real-time reporting, matter initiation, and third-party payment status, among other business processes.

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4) To cloud or not to cloud.

The cloud has been around for a long time, but it has moved with fits and starts in the legal industry. It began as an ethical question that many state bar associations took a long time to publish an opinion. When those opinions finally began to roll out the gist boiled down to yes, it’s ethical, but lawyers still need to do their due diligence around security, storage, jurisdiction, and other salient responsibilities prescribed in documents such as the Model Rules of Professional Conduct.

Another barrier was corporate clients, which had an outsized impact on larger firms and cloud adoption. Security was the primary concern, but as time passed, more and more in-house attorneys realized their employers were largely moving company data to the cloud, that cloud providers are generally better equipped for cybersecurity than law firms, and the concerns gradually eased.

More recently, the 2019 Aderant Legal Technology Survey found 74% of law firms are already using the cloud in some way, shape, or form. This finding was uniform across firms of all sizes. Looking forward, we believe the cloud will be a recurring theme because the level of collaboration and transparency that clients want can only be enabled by cloud-based platforms.

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5) The efficiency and productivity of mobility.

We’ve been carrying around powerful little computers in our pockets for so long; we sometimes take the potential of mobility for granted. Certainly, on-the-go access to legal IT systems is convenient, but it’s also productive and efficient.

Mobility enables a lawyer to pull up a matter or budget status on a tablet computer in an offsite meeting with a client. It allows billing partners to review, edit, or approve invoices from their home on a Saturday morning – rather than driving an hour to the office. Mobility is the foundation on which law firm leaders can develop and implement flexible work policies that support the recruiting and retention of talent.

As we concluded in a legal business report – How to Put Mobility to Work for Law Firms:

“Mobility has become a part of our culture to the extent the capabilities that come with it have shaped expectations of law firms. Lawyers and staff want the productivity that comes with mobility, while clients demand efficiency. More importantly, the business of law stands to benefit from both. There’s certainly no need for an associate to make an hour-long drive to the office on a Saturday to turn a dial, pull a lever, or push an approval button for any legal business process.”

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We won’t keep you waiting too long for part two – just a couple of weeks. If you want to be the first to know, subscribe to Think Tank and have our blog delivered directly to your inbox.

In the meantime, get in on the discussion: what issues do you think will follow us around the turn of the decade and into the next 10 years? Tweet us at @Aderant.

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