Why being app-athetic is bad for law firms

In recent years, a spate of law firms have begun initiatives to encourage the adoption of - and improvement of legal service delivery via - technology. In an age where firms are starting to develop and employ artificial intelligence, client engagement applications and expert systems, we are clearly on the precipice of a technological revolution. Firms must now decide whether they are going to go with the flow, or swim against the tide.

Clients driving change

One simple yet undeniably persuasive argument for law firms to cultivate legal technology is that their clients want them to. It has long been recognised by firms that clients want more than just the sharpest legal minds. Clients, when selecting a firm from the plethora, want to see (the increasingly elusive term) “added value”.

There has been significant fanfare over the need to innovate, and firms have been advocating technological development for years, however, clients now want to see this put in to action. While in the past it may have been easy to pay lip service to the need to innovate, shrewd clients will want to know as early as the tendering process exactly how firms are implementing and developing legal innovation. Firms that will thrive in coming years are ones that envisage and implement clear strategies for innovation, targeted to the needs of the firm and its clients. Asking and understanding what clients want and engaging them in the early stages of innovation will not only help solidify existing relationships but will revolutionise the way in which legal business is conducted, equally serving to prove that for some firms innovation is more than just a buzzword.

Internal and external innovation

It is not just the clients, however, who are driving such change. Ambitious lawyers who want to streamline their work and increase the efficiency of their firm are also propelling legal innovation by developing tools which replace repetitive and administrative tasks, carried out internally, by automation - as opposed to outsourcing. This frees up lawyers’ time to focus on more added value work. This area of innovation is often referred to as “internal” innovation, of which a natural corollary is time and cost savings, which firms can pass on to their clients.

The other side of the coin is externally focussed, product development innovation. Firms that wish to truly revolutionise and ameliorate the way in which legal services are delivered to their clients must look to employees for guidance. The Kennedys Ideas Lab, a Dragon’s Den style process which is open to every employee allows not only for collaborations which make the ideas greater than the sum of its parts, but invites employees at a more granular level to sit at the table. While it is irrefutable that those at a more senior level perhaps hold a more developed understanding of their clients’ business strategic needs, more junior employees at the coal face will be well (and in some cases better) placed to understand the day to day pain points of their clients and importantly, how to rectify them.

The evolving legal landscape

Of course, law does not exist within a vacuum and as such one of the greatest catalysts for legal innovation is the way that the industry is developing. Start-ups, tech-companies and a growing market interest in law-tech have combined to prime the legal sector to innovate. Just recently, the Lord Chancellor strengthened support of legal innovation in the UK by virtue of a panel of industry professionals who will help “to support and accelerate the development and adoption of innovative new legal technologies”. In light of this development it comes as little surprise that firms will need to embrace invention, both for pride of place and to gain market share.

Firms that bury their heads in the proverbial sand will find themselves falling behind. The law, while a discipline, is also a business. Naturally, legal know-how and the cultivation of personal relationships will in no way be rendered moot and will still be of great significance. However, in addition to these qualities, law firms must be able to demonstrate not just a willingness to transform, but an ability. Kennedys have been at the forefront of legal service innovation for a number of years, most recently winning the accolade of Best Client Service Innovation for its virtual lawyer, KLAiM, at The Lawyer Awards 2018.

It is not just apathy or inertia, however, that is the fall of legal innovation - it is also capacity. As firms will be bound by resources (both in the technological and economic sense), those that cannot be innovators, must still incorporate legal technology to remain relevant. The products, from document assembly intelligence to virtual assistants, once established, will naturally filter down to smaller firms via service providers or agents.

The legal landscape is evolving, and in the face of this, law firms must adopt the mantra adapt or perish. While smaller, boutique firms may be able to resist change until technologies have trickled down, larger firms must suspend their apathy and take real steps to innovate, or risk being considered extraneous.

Related item: Helping clients use lawyers less

Read other items in the London Market Brief - July 2018