Derek Southall, founding director of the Intuity Alliance and CEO of Hyperscale Group, assesses how successful law firms are adapting to the new digital reality.
This article was featured in Legal Business.
More has happened in legal tech in the last three years than the 20 that went before. It is now a $15.9bn market with only 20% market penetration. Many law firms are shell-shocked by the rate of change. What steps are the successful digital firms (“SDFs”) of tomorrow taking?
SDFs know they can scale independent of headcount or expensive real estate. Legal fundamentalism is declining, with expressions such as “non-lawyer” and “fee earner” disappearing.
SDFs employ artificial intelligence experts, business analysts and data scientists.
They recognise that conventional IT delivery models lack relevance, and they are shifting to cloud or virtualised systems such as Work10, Netdocs, Repstor, Clio, Peppermint, Lexis One and HighQ.
IT experts in SDFs now focus on those enabling and disruptive technologies that actually make a difference to client delivery. SDFs recognise that full service firms need to partner and collaborate as they simply won’t have enough manpower or skills. Innovation functions are being created to work ‘with’ as opposed to ‘against’ IT functions.
SDFs want systems with the perfect trilogy of cloud, AI and content to take understanding to another level, together with low code systems that are quick to deploy, such as Kim Technologies, Manzama and HighQ.
SDFs “get” the concept of scalable platforms; EY certainly do with their Riverview acquisition. SDF’s – and the big 4 – productise their offerings with scalable client solutions, such as for IFRS 16.
Successful digital firms recognise they are a part of an innovation ecosystem and understand Proptech, Fintech, and Blockchain and their vision of their place in these markets. They know that ‘Regtech’ – technology such as Intraspexion and Tessian designed to prevent regulatory breaches – will be huge, as do IBM with their Promontory acquisition.
SDFs don’t necessarily teach their lawyers to code but they are educating them on what is possible, and many start-ups are putting traditional legaltech to shame – Juro, Contract Pod and Ping. Why did it take Joshua Browder and BillyBot to show “big law” how to develop bots?
SDFs know future systems will auto-price, assemble diverse teams, and leverage third party resource from firms like LOD and Flex, with recommendation engines surfacing knowledge.
Public datasets will be mined by Lex Machina, and tools like LexPredict, CaseCrunch and Tyler Technologies will transform dispute resolution.
SDFs understand that legal tech vendors are marketing direct to their clients, and organisations such as CLOC, will alter the work that clients will outsource. They are optimising their ability to digitally integrate with other providers and systems such as Alacritylaw, and many will be watching the recent $68 million investment in Atrium very carefully.
These firms know that digital is here to stay and that the rule book for legal services is being rewritten. They know this could be their moment.
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