The legal industry is well known for its conservative approach to tech adoption, from the implementation of calendaring, customer relationship management (CRM) tool, e-signing, and even e-filing, among others.
Pre-pandemic it was difficult for legal departments and professionals to subscribe or implement new technologies for the following reasons:
- Legal departments and professionals were too busy with urgent work
- Transition to new ways of working was challenging
- Lawyers are paid by their face value, making it hard to be replaced by technology
During the pandemic, cloud infrastructure adoption by most organisations became a necessity and played a pivotal role in the seamless transition for remote work. The pandemic indeed accelerated the pace of technology adoption with most professionals adopting a virtual lifestyle by amalgamating every possible technology (existing and new) to their work culture. Even the legal departments were not left out from transitioning – video-conferencing, digital contracting and workflows, e-signatures, calendars, e-marketplace, to name a few ...
This pandemic has somewhat relieved the pressure in the industry as the new-age lawyers have had the opportunities to implement new technologies at their disposal, creating efficiency and bandwidth for more challenging engagements.
With the aforementioned being stated, there are still limitations and a paradigm shift needed to bridge the gap for long term benefit.
Tech adoption limitations
According to an article published by the Cambridge Journal of Regions, Economy and Society titled Artificial intelligence in the legal sector: pressures and challenges of transformation, – Social and technological challenges pose a limitation for the legal tech adoption.
- Social challenges involve risk aversion focusing on profit and not on innovation, and fear of loss of job due to tech adoption. Lawyers are risk aversive in adopting legal tech, and law firms are more reactive to changes and client needs than anticipating changes and adoption. Also, there is a belief in quarters of the legal industry that artificial intelligence (AI) and legal tech are not intrinsic to the work undertaken. Law firms operate on billable hours and thus the focus is on profitability and not necessarily on innovation. Increased efficiency through the adoption of legal tech also equates to fewer billable hours. Lower-level employees fear job loss due to the adoption of AI and legal tech, resulting in a reluctance to efficiently use technology or propose such change.
- Technical challenges involve time-consuming, challenging, and costly practices of imparting training, advocating security practices, and increasing the participation rate.
Innovation teams can be the solution to the slow adoption of innovation and technology, by accounting risks and providing client-centric legal techs.
A study by Deloitte titled What’s your problem? Legal Technology mentions the general considerations before adopting legal tech that must be undertaken to ensure effective implementation and ongoing maintenance should include:
- Strategic alignment (i.e., is the legal tech in line and suitable for the operating function of the organisation).
- The right team (i.e., the legal team’s existing knowledge and expertise must be blended with specific IT expertise to ensure optimum choosing and subsequent functioning of the legal tech).
Paradigm shift to bridge the gap
Historically, lawyers’ legal knowledge played a crucial part in hiring. However, legal recruiters now also focus on team members’ business acumen and communication. Victoria Hudgins in her November 2021 article for Law.com titled For Prospective Legal Tech GCs, Communication, Business Acumen Key to Getting Hired | Legaltech, stated, “the great resignation’ continues, leading lawyers are looking at better opportunities, legal tech companies are also on a legal talent hunt for to lead their legal departments and communication and business acumen plays a pivotal role in hiring.
John Gilmore, founder and managing partner of in-house legal and compliance recruitment firm BarkerGilmore, states that “I would say in all instances, the soft skills not reflected on the résumé that are most important to impress the executives on interviews include, clear and concise communication skills, passion for legal and the business, and an ability to influence and motivate others.”
Further, in her October 2021 article for Law.com titled GCs' Business Acumen Can Be Critical for Spurring In-House Tech Adoption, Victoria Hudgins shares the view of the chief legal officers and stated that “while purchasing legal tech GC’s need to think less like a lawyer and more like a business executive.”
While speaking at the “How to Measure Your Tech Transformation ROI”, Mellisa Mann, VP and General Counsel of Terminix Commercial stated that “I don’t think you need an MBA but if you’re practicing in-house you [already] have a business mindset.” She further added, “Think in terms of you’re talking to the CFO, you’re not talking to the court, shifting your mindset to think like the business will put you in a better position.”
Long-term benefit in mind
While there are evident technical and social challenges limiting the adoption of legal tech and AI, there is a shift in position considering the long-term benefits legal tech offers to the legal industry and ultimately to the end consumers.
The whole process of acquiring the right legal tech comes from the process of the decision-makers to gauge the business parameters with legal acumen. Gone are the days when decisions were solely based on necessity, now it's more about the result including data-driven insights and return on investment (ROI).
Legal leaders of the future would be aligned towards the business aspect of implementing legal tech to reap the benefits. Till then the tussle of immediate Profit via conventional vs Technology implementation for better efficiency will be a major factor for most legal departments. What would you choose?
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