Embracing Technological Change in the Legal Profession: Law firms must decide how to respond to change

For decades, legal professionals have thrived, stumbled and ultimately survived by employing the time-honored model of providing one-off service delivery. Today, that model is being challenged, and automation is playing a greater role. Gone are the days when legal services were shrouded in mysteries only understood by lawyers. Now sophisticated clients have a better understanding of business necessities and a do-it-yourself (DIY) approach to many services. Should law firms and legal professionals embrace these new realities or ignore them until their pocketbooks start to feel the pain?

Can Law Firms Think Like Enterprises?

Business models are moving at light speed. New solutions to everyday challenges are being developed by enterprising companies and product developers. Legal services are not exempt from these developments. Fifteen years ago, self-serve DIY providers did not exist. Yet today the number of on-demand legal providers increases exponentially every year as technology provides new opportunities for automating routine services. From business incorporations to corporate filings to regulatory compliance, automation is playing a larger role in the delivery of legal services.

Faced with this reality, modern law firms have a choice: They can acknowledge the changes occurring or simply ignore them. Recognizing and embracing change means fundamentally adjusting the mindset from being simply providers of legal expertise to business leaders capable of envisioning a new service model. The alternative, which is to ignore these changes, will likely result in the demise of many traditional legal providers – an unattractive option for those who have committed their careers to providing legal services.

Law firms could embrace a mindset more common to the enterprise, a mindset that acknowledges that technological change must constantly be integrated in a company’s service offerings to ensure that growth, revenue and retention goals are all achieved. Of course, there’s a big impediment to this mindset within the modern law firm: lawyers. Attorneys are apt, given their academic and practical legal training, to rely on old ways of doing things. This tendency comes not just from the focus lawyers have on following procedure and precedent but also from pricing structures (i.e., the billable hour) that reward the number of hours human beings devote to solving problems. 

As a result, legal professionals tend to reject change and innovation. This is precisely why automated services raise red flags for lawyers: Automation appears to be a threat to the very way in which legal services are delivered. However, if law firm leaders could train themselves to think like Apple, Google or Tesla, they would learn to invest their time examining the ways that innovative legal services can deliver better value to their clients. Forward-thinking companies do not wait for their customers to demand a product or service, they innovate and create the demand for new offerings.

Should Law Firms Rely on Clients to Demand Change?

For years, legal technology providers have scratched their collective heads wondering why legal professionals are so reluctant to embrace the benefits of technology. Often, change has only come as the result of client demand. But should clients be required to be the driving force?

Based on the Apple/Google/Tesla model, the answer should be no. Clients, while increasingly more self-reliant than in the past, still depend on the advice of professionals. And, in today’s business environment, that advice should include technology and automation recommendations that serve a client’s needs more efficiently and provide better risk management than manual processing. From automated notifications for incoming lawsuits to real-time updates about changing corporate compliance requirements, legal services are soon going to be delivered in a way that’s tailored to clients’ needs and demands over modern communications networks.

In one sense, law firms know that all of that is coming. After all, clients are increasingly evaluating their legal service providers based not only on the legal advice they receive but also on the quality and cost of the service being provided. And yet law firms that insist on hand-cranking services like business formations, state-based compliance and registered agent services are in danger of losing clients to modern, enlightened firms. For it is these firms that make delivering services a delightful experience to their valued client base.

Forward-Thinking Law Firms Will Win

Automated service delivery is here to stay. While the need for high-quality legal advice and advocacy is undiminished, many of the manual services provided by legal professionals and law firms are quickly becoming extinct.

Law firms that embrace the future of technology and automation will succeed, while those that refuse to change will struggle. The time is now for law firms and their leaders to pick their heads up from the day-to-day grind and become forward-thinking enterprises.

 

Erik Treutlein is the chief executive officer and founder of Legalinc. As the general manager of Attorneys Service Corporation, he saw that waste is a big part of the practice of law, so he decided to do something about it. Since business formations and compliance are ripe for automation, Treutlein built Legalinc from the ground up with one goal: to automate mission-critical legal services through secure, scalable software. He can be reached at erik@legalinc.com.

John Eden is the chief revenue officer of Legalinc. Leveraging his experience in corporate law (Wilson Sonsini Goodrich & Rosati and King & Wood Mallesons) and product management (Zynga), he ensures that Legalinc’s product suite dynamically evolves to optimally serve stakeholders in the legal ecosystem. He can be reached at jeden@legalinc.com.

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