Many would agree that the legal profession has changed dramatically in recent years, and the dynamic environment firms are operating in today also brings great challenges. Some of the main challenges facing the legal industry involve fee structures, changes in the competitive landscape, and increases in operating costs. Recruitment, retention, and competition for talent are also a major challenge. To deal with this firms are now finding ways to increase profitability and reduce costs. One of the ways they are doing this is by changing pricing models. Under more pressure to quote in flat fees, solicitors are looking again at the time spent on areas like research. Time not billed for is lost and some firms may only be billing for a fraction of the time spent on cases.
Looking at different forms of technology has been shown to increase efficiency in areas like case management and research. Reducing the time spent on such aspects of legal work can make flat fee structures more profitable, and according to a 2016 Bizplus survey, maintaining profitability was seen as a major obstacle to deal with for the sector.
As changes to business processes among law firms become more frequent, many see this investment in technology as an opportunity for growth.
All of this highlights the need to invest in new systems, but this is not without its considerations. Bloomsbury Irish Law Online, a leading knowledge management system for law professionals, spoke with Denis Kelleher, author and expert in privacy and data protection, to discuss some of the technology that is being adopted and the issues involved. We discussed the main tools and services that firms are moving to, the implications in terms of privacy and data protection, and the benefits as far as increased productivity and the reliability of information.
A respected authority on the subject, Denis has authored leading books in the area, such as Privacy and Data Protection Law in Ireland and most recently, EU Data Protection Law.
We discussed how many law firms don't believe they are utilizing technology enough and how this can be due to either lack of in house IT talent to manage the systems or resistance to change.
We also discussed the data protection issues in regard to new technologies and how the right to be forgotten is affecting the details that can be retained in systems such as case management tools. We started with a discussion of technology adoption in general.
So what kinds of technology are major firms using?
Firms today are using many different kinds of technical resources: case management systems; research databases; practice management; document storage; billing and electronic discovery systems.
Discussing the adoption of technology, Denis said that ‘there are far more people adopting systems across the big firms’. ‘The presumption is that this will reduce the amount of work that lawyers do, but in actuality it will reduce the types of work they do’ he said.
According to Denis, access to technology should allow for more fees to be generated and bring higher cost work for lawyers through e-Discovery systems. E-Discovery systems allow for the identification, collection and production of information upon request in a lawsuit. But the process around e-Discovery can be complex due to the amount of data involved. The right to be forgotten will also play a part in the kind of information that is stored and held.
Speaking about the right to be forgotten Denis said that this can also complicate the information held in other legal systems.
‘With case management systems for example, people can assert their right to access’. ‘Where in the past a solicitor could hold onto paperwork until a payment from the client was received, they now cannot exclude the client’s access to the information once the case is finished’.
Discussing the future, Denis suggested that ultimately firms might move to using more artificial intelligence, and there are concerns in this regard, but it is doubtful whether artificial intelligence will ever completely replace the solicitor. ‘It will be useful for dealing with the more rote tasks, such as the handling of a parking ticket, but the subtleties of more complicated cases, should prove more challenging for any form of AI’.
There is a massive amount of information now more easily available through the internet and electronic storage, and this means that solicitors must handle this information in a way that ensures they are getting the most of out of it.
In regard to information gathering Denis commented that new systems are being utilised by firms but the credibility of the data available is not always consistent across all systems, and the information is of differing levels of reliability. ‘The main issue is quality control versus the investment’…’when solicitors go to Google to research a topic, the quality of material they can back can be often unreliable’.
‘There are a variety of people commenting online and it is a far different scenario than one where you are using material from books or other resources, which are written by highly credible authors who have been selected by professional editors who have double checked their work. This is a much stronger thing to base your research on’, Denis said.
This is similar to what we hear from clients at Bloomsbury Irish Law Online who were using free online resources, which often lacks the kind of credibility that the books would have. The best of both worlds would seem to be to find a resource that allows for the speed and efficiency required by today’s practice, while at the same time, giving access to highly relevant material.
With some solicitors spending as much as a fifth of their time on online research, it is important that that is done productively.
‘What we are finding is that technology can be expensive to maintain and that it becomes an economy of scale where the bigger firms can adapt to the changes quicker’, Denis said. This creates more efficiency in these firms so that they then grow further and this growth and consolidation of the bigger firms, which has been seen in other industries, can lead to widening gaps.
PWC’s law firm survey 2016, reiterates the point about widening gaps in the industry. According to the survey, the main challenges facing firms are competition and new entrants to the market, which may have sleeker and more up to date ways of operating. The survey highlighted a widening gap between the best and worst performing firms and saw 49% of firms surveyed wanting to use technology to improve client experience.
Retention and Recruitment
‘We are also seeing investment in technologies and resources in order to attract and adapt to the needs of a new generation of talent across law firms’. These firms are using MOOCs (massive open online courses) and access to online resources such as Bloomsbury Irish Law Online to provide a more continuous learning and research environment for trainee solicitors.
Millennials are used to having information that is current and relevant at their fingertips in seconds. Providing resources that allow for this while ensuring the information is credible is essential to attract and retain the best talent. At Bloomsbury Irish Law Online, providing access to faster and more up to date results is one of the main reasons we see practices switching to online services.
Challenges to adopting new technologies
One of the main challenges for firms adopting new technologies is finding ways to fund the investment. Examining which systems are a priority, and which could reduce costs in other areas where you are already spending, can be one way of funding systems such as Bloomsbury Irish Law Online.
Another area where firms can make the transition easier is through strong management and decision making with the ability to approve decisions fast. This helps put your firm in a better position to compete with newer more streamlined practices. It is more important than ever today for firms to remain nimble to reduce the competitive gap.
Responsiveness was ranked as the most desirable quality for in-house solicitors choosing to outsource to law firms, a recent survey highlighted. Having systems that allow for efficient research and case management enable this kind of responsiveness.
However, as mentioned the need for speed needs to be measured cautiously. As attractive as it is to move to new technologies there are considerations in terms of privacy, quality of information and the investment involved.
Bloomsbury Irish Law Online is delighted to be at the front of this changing environment, with many of the top tier law firms, but also a strong mix of small and medium practice, and in-house counsel using the system.
Bloomsbury Irish Law Online is an online research portal that contains leading books and access to commentary, precedents, legislation and case law on a variety of aspects of law. For many firms, moving towards a paperless office is more of an aspiration and because of this, digitizing their legal reference material for access within one portal would be an ideal solution.