Investment is pouring into digital transformation at legal firms.
Even before the pandemic, legal tech spend had reached $1.3billion according to King’s College London; five times higher in 2019 than 2017. If your firm has not yet made strides towards this digital future, now is the time to act. Some companies have already automated many of their processes for the benefit of employees and clients alike. Without following suit, it will be easy to be left behind.
The perceived complexity of digital transformation can cause firms to procrastinate. Patience is needed. It is wise to step back and consider where your firm is on its own digital journey before committing to a roadmap. It is possible to view digital transformation as a four-stage ‘wave of change’. Let’s take a look at each aspect in turn.
It is possible to view digital transformation as a four-stage ‘wave of change’.
Stage One: Early signs of transformation
Rolling out digital operations often begins with establishing basic online self service. At this stage, clients choose the convenience of digitised engagement for simple interactions. Data and digital touchpoints allow firms to deliver higher quality services more efficiently, as well as experiences we might normally associate with eCommerce companies to better support clients’ needs. Customer-centred disruption represents an opportunity in the market for forward thinking law firms. Those that can transform their client experiences along the lines of the digital retail model will be best placed to survive the tech tsunami that is clearly coming towards us and be set up to stay ahead when future waves hit.
For example, large-scale class actions make it notoriously difficult and time-consuming to collate evidentiary statements. We are working with a US firm whose vision is to create digital services that simplify this. It collects and compiles data from victims and streamlines the process of building a case. This will reduce errors and greatly cut the complexity – and cost – of the entire process.
Stage Two: Starting to feel the effects
Having implemented digital services that allow firms to build stronger relationships with clients, the race will be on to enhance operational efficiency and agility. Digitising internal processes means implementing artificial intelligence (AI), robotic process automation and composable technology. Firms will then be able to further improve profitability, offer greater customer value and open new routes to market.
As an example, BrightFlag offers AI services to the legal sector in the form of an AI-powered review of invoicing. The intelligent service automatically checks narrative lines against billing guidelines and the agreed fee model. This will increase review accuracy and free up teams to focus on higher-value activities. Fast-moving professional services businesses are already implementing digital convenience and agility into their ecosystems and reporting how it has improved client relationships.
"Customer-centred disruption represents an opportunity in the market for forward-thinking law firms."
Stage Three: Advanced “retail-style” offering
Law firms have typically operated with a sales process that is heavily reliant on person-to-person relationships. Retail businesses, meanwhile, have successfully automated interactions to improve
efficiency and unlock the opportunity to scale.
By this stage, we have reached a point where customers are used to full online self-service when engaging with legal firms. They are expected to offer detailed personalisation of relationships in digital – just as happens in eCommerce.
Digital tools are already smart enough to streamline professional services and customer experiences. For example, IronClad automates contracting workflows and approvals. The service, already used by L’Oréal, Staples, Mastercard and other leading brands, automatically identifies critical terms and entities, turning contracts into code and allowing users to search, tag, and manage them. It is this type of technology that is allowing tactics used by successful retailers to be applied to legal firms.
Stage Four: Wholesale operational disruption
This is the stage with the greatest extent of disruption, and the one where you should
be most worried about rivals stealing a march. But it is also the most exciting stage of the digital transformation journey to aim for. We are talking about complex service automation.