Tech improvements and changing client expectations are just some of the key trends LawPath has identified for the legal profession as it moves towards 2019.
Changes to what clients look for in a lawyer
LawPath has identified a “broader ‘unbundling’ of legal services in Australia and globally, with clients moving away from full service firms towards smaller boutique offerings.
While corporates still want “gold-plated” services, businesses and clients are happy to complete a risk-versus-cost analysis for lower costs and specialised offerings.
“Technology has meant that a team of five senior lawyers with subscriptions can produce the same offering a team of 30 would have five years ago,” LawPath said.
As a result, “clients can get top tier service without the marble staircase, leather bound books and high costs.”
Online marketplaces and the rise of the freelance lawyer
The ease of online access has made it just as easy now for clients to find a lawyer online, and reduced, if not removed, barriers which once confined legal service to local areas due to geographical limits.
With the expectation too that 45 per cent of the Australian workforce will be part of the gig economy by 2020, the rise of the freelance lawyer is also to be expected.
The benefit to clients of freelance lawyers is transparency, with costs able to be quoted upfront and reviews available online.
LawPath has specifically provided the example of Lawyers on Demand, where lawyers take on two to three month contracts, with more than 50 per cent of the US’ fortune 500 companies utilizing such services.
With specialised services on the rise, there is indication of “a general commoditisation of legal services.”
Including fixed pricing and repeatable tasks, LawPath expects that “lawyers and firms must specialise or commoditise. Ones that are left in the middle will not survive.”
“Not only are law firms embracing technology to better serve their clients, the courts are making this necessary for their survival,” LawPath has noted. Examples of such technology include access to the cloud, automation and smart contracts, as well as “unprecedented investment” in the legal tech space.
Access to cloud services will continually increase in uptake from lawyers and firms, and will, according to LawPath, “see smaller firms thrive.”
“Gone are the days of law firm libraries or firms requiring an in-house accountant, researcher, or IT team,” it said, highlighting examples such as Xero, LEAP and LexisNexis.
Meanwhile, automation and smart contracts are revolutionizing document review systems and processes, with LawPath citing LegalGeex software’s ability to beat experienced lawyers in both accuracy and speed.
These technologies will only increase in efficiencies and accuracies with increased funding. 2018 has seen more than $1 billion invested into legal tech, a three-fold increase on 2017 figures.
For LawPath, they are seeing “unprecedented investment from law firms both in internal legal technology projects, but also in acquiring innovative new companies.”
The effect of an increased uptake in tech will only increase the recent prioritisation firms have placed on cloud privacy and cybersecurity.
The entrance of accountants
LawPath also highlighted that the big four “have started encroaching on the legal space in a big way.”
Ernst & Young’s recent purchase of Riverview Law, and KPMG’s announcement that it will double its legal department and hire 3000 more lawyers in the coming year, to make it one of the largest law firms in the world, should be watched closely by lawyers and law firms alike.