In-house departments ‘ahead of some law firms’ in terms of innovation
As in-house legal departments become more innovative and companies aim to keep as much work in-house as possible, law firms need to embrace technology in order to compete.
Lindsay O’Connor is the head of online solutions at LexisNexis, a global provider of legal, government and corporate tech-focused solutions. Speaking on The Lawyers Weekly Show, in an episode in partnership with LexisNexis, she explained how lawyers could successfully navigate drafting and tech moving forward and the importance of adopting new technology post-pandemic.
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As the profession becomes more aligned with new technology and innovation, Ms O’Connor said that post-pandemic, firms will have to continue to evolve – just as they had to when COVID-19 first hit.
“A concern to me is I hear people talking about going back to normal. And for me, that’s kind of a thought process that things in the future are going to go back to being like they were prior to the pandemic. And for me, that won’t be the case. And that shouldn’t be the case. Because I think in the past 18 months, we’ve all learned a lot of new tools, a lot of new techniques. And for me, the biggest opportunity is to embrace that moving forward,” she said.
“Even when we return to the office, not to go back to how we were doing things 18 months ago. But to really embrace those changes. And some of the efficiency gains that they’ve brought to firms.”
There are also a number of issues in not embracing new tech – and therefore, becoming less efficient than your competitors.
“The key pressure for firms at the moment is that there’s obviously a continuing pressure for firms to grow at a time when demand for legal services is remaining relatively flat. So that means in order to increase profitability and increase margins, the only way that firms are really going to be able to do that is to increase that margin on their existing revenue streams. And that means becoming more efficient, essentially,” Ms O’Connor said.
“We’re also seeing firms increasingly offer fixed fee work. So obviously, if you are offering that to your clients as an option, you want to make sure that you are as efficient as possible. So, you want to make sure that those efficient processes are in place before you start to offer that kind of fixed-fee work. Otherwise, you can actually find that your margins are shrinking at a time that firms really need them to be growing.”
In addition to putting more efficient processes in place, there are a number of “interesting ways” law firms and legal departments are now operating, Ms O’Connor added.
“What we’re finding, particularly with in-house legal teams, is that there’s often a desire for them to try and keep as much work in-house as possible. And so, what that means in practice is often a half-finished piece of work as being handed across to their external law firms to pick up something that’s already been set in place. Or to just do a particular part of that legal matter.
“For example, it might be just drafting the end document when they haven’t actually been involved in any of their preliminary discussions. I think that certainly necessitates a change to a lawyer’s skill sets, to not necessarily have ownership of a legal process from start to finish, but just to be able to pick up pieces of that legal matter and deliver on them,” she explained.
“We find that the in-house departments actually are some of the more innovative in the legal profession. I can just think of a few people I’ve spoken to from that sector. And they’re really doing quite interesting, exciting things. I would say that they’re almost ahead of some of the law firms that they might be dealing with.”
In terms of how law firms can get up to speed with new technologies, Ms O’Connor advised firms to start with a complete review and map out existing processes and tools.
“Once you’ve done that, you can really map out the user cases for where you need help or where you think you can improve the efficiency. Then go and look for tools that are going to help you specifically with those pain points. That’s going to avoid you adopting technology just for the sake of adopting technology. And that when you do adopt a kind of system to help you with that, it’s really going to actually meet the pain points that you’ve identified in advance. And then do a good review of what’s out there in the market,” she advised.
“There’s more tech out there than ever before. We’re finding everything from really innovative, legal tax start-ups to places like LexisNexis where we’ve really been through an evolution in the past few years from being a very traditional legal publisher to now being at the forefront of some exciting technological development. So, there’s a lot out there.”
The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full conversation with Lindsay O’Connor, click below: