For many global industries, the world is going to be a very different place tomorrow than it is today, including for the legal industry. And while I don’t believe it’s going to be the extinction of all lawyers, legal librarians, and chief information officers, neither is it going to look like 2007 any time soon.
The legal world is a very complex and mature industry (yes, industry; one that is filled with many mature businesses) in which highly profitable business models have been in place for years. And although lawyers don’t tend to be early adopters, we are now in a world that is hungry for technology, and there are plenty of firms doing very innovative things. For example, the challenge of improving efficiency in the delivery of legal services is one, among many, exciting opportunities.
Here are three reasons change is coming; where do you see yourself fitting in?
New legal ecosystem
A new legal ecosystem has emerged with new players and new answers that include pure-play technology, as well as technology-enabled legal services, to meet client and institutional demands for more efficient, cost-effective solutions. Clients are asking to be charged for the value of the matter, pushing for unbundled services so they get what they want. This leaves room for disruption and innovation and puts pressure on the law firm business model.
There is an opportunity to bridge the client interest and law firm interest with new technologies like Allegory Law, a software tool that integrates critical case information and provides clients with more effective data management. And Seyfarth Shaw’s Seyfarth Lean, a value-driven client service model that improves process with project management and tailored technology solutions. Meanwhile, BakerHostetler became the first BigLaw firm to engage ROSS, an “A.I. lawyer that helps lawyers research faster and focus on clients.”
Serving clients is the whole point of the profession, and if we can help lawyers serve clients better with innovative technologies and valuable ideas, then we’re all in a better position.
Increased cross-boundary collaboration
Law firms, in-house counsel, and third-party partners including alternative legal services providers are working together to disrupt the traditional client/law firm model. General counsel aren’t looking to do away with their law firms – they need them. Today, there is more regulation and more risk and they need the know-how of lawyers to overcome these challenges.
One example of this is Avis budget group’s rigorous Request for Proposal process to compile its panel of law firms. They went from 700 law firms to an “all star team” of seven fixed-price law firms globally who would work together. The result is a successful collaboration for both Avis and the panel law firms.
Or look at Thomson Reuters own partnership with Clifford Chance. This collaboration helps global financial institutions tackle their most pressing regulatory obligations relating to margin rules for uncleared, over-the-counter (OTC) derivatives in a timely, efficient and more cost-effective manner.
Buyers have more options than ever before
The Big Four, Legal Process Outsourcing providers, and others now are providing legal services, giving in-house counsel more leverage in their relationships with outside counsel and putting pressure on “Big Law’s” business model.
Recently, Deloitte Tax & Legal posted earnings performance growth of 10 percent during FY2016 — its highest growth since FY2008. They attribute this in part to the sixth consecutive year of double-digit growth in Deloitte Legal.
So, what does this mean? The evolution of the legal industry provides tremendous opportunities for law firms and their clients to chart new paths together.