Is technology a barrier to growth for law firms?



For every legal professional, the biggest threat to the future growth ambitions of top law firms is cyber risk, the accidental leakage of confidential data through email hijacks, phishing attacks and malware. Cyber risk has become so troublesome in the recent years, that top 100 law firms reported it as the biggest threat. A whopping 90% of law firm leaders said they are ‘extremely’ or ‘somewhat concerned’ about cyber risk in PwC’s Annual Law Firms’ Survey.


The foundations of the legal profession are based on client confidentiality and client trust; hence, it can be understood why the threat is being considered too serious. With remote working now becoming a norm, this concern has increased much.


Despite a growing awareness of the risks relating to cyberattacks, instead of investing in long-term tech infrastructure that can adequately support their future growth ambitions, the majority of law firm leaders often expect their already overstretched and under-resourced IT teams to simply handle it. It is therefore important the law firms stop viewing technology as a support function. Firms having a strong tech infrastructure, can not only outpace their competition, but can also better align with client expectation and properly defend themselves against cyberattacks.


Generally, lawyers think of technology in one of two ways: they view it in far too simplistic terms (videoconferencing tools, emails, technology that was around in the 1990s), or they view at as being far too advanced and beyond reach, for instance, robotics. The long-proven tech tools that can make a real difference to a law firm’s bottom line by automating low-priority tasks, streamlining workflows or sharing information – can be overlooked altogether.


There are many firms which are utilising legal technology to its full extent, by working alongside their IT departments to introduce innovative new processed which were previously unseen in the legal sphere. But the same, cannot be said for all the law firms. A survey highlighted a significant drop in the number of in-house lawyers that felt deploying and integrating new technology was a barrier to adoption, falling from 56% in 2018 to 40% in 2020. Law firms are currently under the mentality, “if it ain’t broke, don’t fix it”. A 2021 survey by the Solicitors Regulation Authority (SRA) found the biggest barrier stopping law firms from innovating is “uncertainty about the expected business benefits” (36%), followed by “not a strategic priority” (31%), and “the mentality that ‘it isn’t needed at my firm’” (27%).


It is important to get the infrastructure in the right place. Lawyers need to understand that client expectation has evolved. As a lawyer, one can spend a large amount of time on highly repetitive tasks, such as proofreading documents, researching answers to client queries, rewiring pre-existing contracts and the like, and even though this task is repetitive, it is important. But as client expectations have changed, they believe in the mentality, “more for less”. A certain survey found 58% of lawyers felt that their clients are more likely to expect the same or a greater level of service for less than they were 12 months ago. In addition, 45% of respondents said client expectations are now higher. To counter this growing problem, a rising wave of firms are seeking to increase efficiency by introducing new systems to improve both internal and client-facing processes. These, in turn, will free up staff so that they can spend more time with clients, adding more value.

Legal drafting is a tool, which firms can adapt to. The application allows to quickly draft legal documents by pulling together previously used clauses, accessing relevant practice notes and sharing them around with colleagues. The point is, there are a wealth of CRM, automation and AI-powered tools on the market that come with massive time-saving and cost-saving benefits. But without modern cloud-based environments and systems, such as Microsoft 365, a large proportion of this technology and innovation will not be accessible.

Firms that decide not to invest in a modern IT infrastructure now could face serious consequences in the years to come. Aside from missing out on the latest tech, these firms will risk losing clients and potential revenue. Moreover, these firms will face and increase in security threats and inefficient workflows, facing massive manual and human errors.

 

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