The pandemic has altered the lives for everyone and a recent report in the Financial Times highlights how lawyers have been forced into their digital future faster than they might have imagined.
While lawyers and accountants have often been immune to rapid technological change, that too is changing rapidly. They are now entering a new era of rapid legal-tech change.
And Law.com reported on the cuts in IT budgets for major firms in the US who were, however, not limiting their IT development but accelerating it.
As Brett Burney of Burney Consultants said current IT budget cuts aren’t as severe as the ones he saw during the Great Recession and part of the reason is that at present technology isn’t just essential to a law firm’s business, but also its ability to continue operating through a pandemic. Indeed, IT budgets have been redirected to a new pressing priority: transitioning to a remote workforce.
Although the lockdowns and working from home trends lessened the impact of the change, it has accelerated the use of online technologies at an unprecedented pace for a variety of areas, health services being a principal one but there are many others like online shopping too, but lawyers are now ready to follow the trend.
Wolfgang Münchau, Financial Times European commentator, recently dubbed Covid-19 the “end of the analogue era”, to explain the shift from technology as a support function to the use of, say, mobile phones as producers of real-time data.
As lawyers and accountants deal mainly in knowledge rather than products, according to author David Moschella, and that focus — and healthy profit margins — has in many cases protected them from being forced to overhaul their business models entirely.
The incursion of machine learning and artificial intelligence into legal departments puts lawyers in the “foothills” of profound change, says author and government adviser Richard Susskind, a well known commentator and legal industry ‘futurist’.
The big digital shift that took place between 2006 and 2016 concerned moving from ownership models to sharing and streaming, cloud-based computing and the development of apps using location services such as taxi-hailing service Uber and food delivery services online.
But the current phase is more drastic, according to Mr Moschella, and will have a more radical effect on the business of law. “The first two waves [of disruptive innovation] haven’t been strong enough to reshape the professions, but we think the third most likely will,” he said in a 2017 report.
Commoditised Legal Services
The commoditisation of legal services has largely been driven by the Big Four accounting firms, which has in turn placed pressure on the law firms to increasingly use software and technology to develop their services too.
However the law firms have used technology to better deliver legal services that they have traditionally offered by ‘grafting’ technology onto what has already been offered.
However technological barriers remain for law firms. The recent report from PwC found that the adoption of digital and emerging technologies had advanced further in the legal sector with several firms establishing “some form of mobile apps, automated document production, data visualisation, AI, and smart contracts, as the report showed.
Robert Shooter, head of technology at London-based law firm Fieldfisher, says: “We’re a traditional lot and cultural change — which is so important if we want our lawyers to adopt the use of innovative tech — is exceptionally difficult. People like doing things the way they’ve been doing them for generations.”
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