7 Fresh Observations about Legal Tech from an Industry Newcomer with Experienceaderantuser
by Steve Buko, Senior Vice President and Chief Technology Officer, Aderant
You can learn a lot about your own industry by exploring technology developments in other vertical markets. At the core, every market faces similar challenges such as driving operational efficiency, using data and analytics to set better pricing, and capturing institutional knowledge for re-use.
The technology challenges the legal community faces are similar to the challenges in other markets. There are nuances that make the business of law unique, such as culture, business structure, organizational relationships and how, as a community, we go about solving business problems with technology.
That was part of the attraction for me in joining the Aderant team. While I’m fairly new to this role, I’ve had the chance to study how teams use technology to solve problems in other markets over the course of my career including telecom, big-box retail and marketing. I’d like to believe that gives me an ability to look at the problems in legal technology in new ways.
The first several months of my tenure here has been a whirlwind of information gathering – meetings and conferences with law firms, clients, prospects and my team. This has provided me with an opportunity to form several observations about the legal technology community. I thought it would be interesting and useful to share some of these here on the Think Tank.
1) Business of law leaders run in tight-knit groups.
When we get CFOs and CIOs in the same room for conferences and events, I am always surprised to see they already know each other. This doesn’t happen often, and certainly not to the same degree, in other vertical markets. It’s a strength for the legal market as it lends itself to collaboration and knowledge sharing even in a competitive market.
2) The relationship between CFOs and CIOs makes a difference.
Acquisition of a new practice and financial management software impacts the entire firm, not just the finance and IT teams. That’s why some law firm CFOs are more involved in the technology decision-making process, working together with CIOs to make these big impact decisions. In my observation, the relationship CFOs have with CIOs in law firms tends to fall into one of three categories:
The first category is where the CFO is really driving IT. They chose the products based on their requirements and the CIO is tasked with managing it. In some cases, the CIO is tasked with integrating several systems the CFO acquired, without fully understanding the technical challenges or business strategies that are associated. In this scenario, IT is functioning purely in an operations role. In this model IT will tend to be behind, and the firm will struggle to get ahead.
In the second category the CIO is making highly technical business decisions in a vacuum and rolling out business critical functionality to the firm. In some instances, the CFO or finance leader has not been an integral part of the decision-making process resulting in a technology rollout that does not provide the business value needed by the firm.
The third category has the CIO and CFO working as peers. In these instances, the CIO is a strategic partner to the CFO and manages the vetting process and selection of technologies that solve business problems. From my perspective, the latter group is in a much better position to both facilitate successful implementations and help law firms leverage technology for strategic advantage.
3) Embracing change can be the biggest “technical” law firm challenge.
The biggest technical challenge in many law firms isn’t technical at all – it’s human nature. It seems to me, the status quo thinking is a lot more like apathy. The resistance to change is a disinterest in anything that requires us to modify our behavior, even when that change is for the better.
Consequently, too many senior leaders abdicate the responsibility of technology decisions to younger business of law professionals. Ostensibly, younger business of law professionals have grown up with technology and know more about it. The risk is, this puts big expensive decisions that will have long-lasting effects into the hands of the least experienced business of law professionals in a law firm.
To the best of their ability, law firm leaders have to be actively involved in technology decisions.
4) Analytics and automation are big opportunities in legal tech.
The retail world has successfully applied AI powered predictive analytics in pricing and shopper habit forecasts for many years now. The technology is mature and proven, and for law firms, I believe analytics and automation represent big opportunities that are achievable today.
Sure, we’ve seen some innovation in applying analytics in eDiscovery and legal research but that’s just scratching the surface. There are other areas related to automation and efficiency gains that hold promise, particularly where we can augment analytical capabilities with AI and machine learning. For example, law firms could look at ways to apply predictive analytics to litigation, pricing and business intelligence to impact operational efficiencies.
5) Legal technology needs better integration.
The case for integration is straight forward: tools that allow a law firm to share data increases the value of their overall technology stack and helps them make better decisions. While the ecosystem of solution providers is relatively small, compared to other vertical markets, the industry lacks the standards necessary for integration. Every vendor – and every law firm – seems to do their own thing when the community would benefit greatly by establishing standards for data interoperability.
Integration is going to become increasingly important as law firms move to the cloud. This is because when products move from on-prem servers you own to the cloud servers you rent; you lose some of the flexibility around your access to that data. For this reason, smart legal technology investments will demand open access and APIs from solution providers.
6) Cloud adoption is really happening in law, with caveats.
Law firms are warming up to the idea of the cloud, especially among the small and mid-sized firms. For many, moving to the cloud is simply more efficient and economical.
The one category of firm that sends mixed signals is large law, but it’s not entirely of their own choosing. Typically, when initially asked if their firm is ready for the cloud, most will say they are ready to move – after all many CIOs want to get out of the business of maintaining all these systems.
However, upon further discussion and digging deeper into the same question, the answer frequently changes to, “Yes, we are ready to move to the cloud as long as our clients are willing to come along.”
The banks, of course, are among the largest law firm clients and rightfully have significant data privacy and security concerns. Large law will only start moving to the cloud in mass when clients agree to go along for the ride.
7) The cloud will transform the role of IT
CIOs and their teams will see their roles evolve as the cloud adoption grows. The days of having your own air-conditioned data center with racks of blade servers are numbered. IT leaders in law firms will morph from systems experts to business of law experts. Their role will be to help law firms navigate a sea of technology options to help them select systems that provide new operational efficiencies.
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It’s not a matter of rolling out technology for technology’s sake, rather it’s been a methodical and continuous process of identifying tools that add value and then executing. If there’s a common thread in these observations, it’s the central role the law firm CIO has in the future of the business of law. These professionals need both the support to create a vision for legal technology within the firm, and the latitude to implement it.