The tech transformation within the legal industry is exploding. The global AI legal technology market alone is poised to generate over $37 million by 2026, according to Zion Market Research, up from only $3 million in 2018.
Many in-house legal teams are exploring new ways to integrate technology into controlling costs, optimizing limited resources and maximizing time for strategic thinking. Leaders have several legal tech options to explore, but knowing which solution can best fit their needs can prove challenging.
The smart path forward in adopting a legal tech solution is identifying your needs, determining which features are the most critical and ensuring you have buy-in at several levels to drive success.
To start, you’ll want to validate whether the root of the problem you’re trying to solve can or needs to be resolved with technology. Technology isn’t necessarily going to solve every business issue, but it’s especially well-suited to standardizing processes, detecting errors, simplifying collaboration and generating overall time savings. Defining your needs from the beginning can help streamline your solution search and shorten the path to your desired benefits.
Within corporate legal departments, one common concern is cost control. Oftentimes, organizations inspect how legal work is resourced and allocated. Outside counsel services can represent the most significant (and variable) expense category, excluding your in-house employee salaries. Demand for such services also invariably increases as companies grow and success brings new complexities. Yet most in-house teams still lack the essential ingredient for transforming outside counsel engagements: transparency.
Matter management and modern e-billing solutions can help outline and increase ROI for your organization. These tools provide you with a detailed look into what work is being done, who is doing it and how long it is taking them — internally and externally. These solutions also allow you to compare that information with similar data points over time in order to gain deep insights into spending and help guide decision-making. Using data-driven insights on pricing, billing compliance and other factors can give your in-house legal team the ability to impartially compare firms and make an objective decision on which ones yield the best value.
Contract management is another avenue in which legal tech can pay dividends. When managing a significant volume of contracts on a regular basis, using e-signature and contract lifecycle management software can lessen the time, burden and effort on your team while also improving how sales deals, nondisclosure agreements and a variety of other contracts are created, negotiated and stored internally. Using a legal tech platform, attorneys and legal teams can spend more time on strategy and less on menial tasks like trying to locate a specific clause.
After identifying your organization’s needs, you’ll want to examine solution features and determine which are critical versus noncritical. As you begin narrowing your list of potential solution providers, make sure they have those critical features that meet your needs.
Analytics is one aspect not to be overlooked. Legal operations software helps your team evolve from making decisions based on anecdotal evidence to relying on data. As a result of this transparency, corporate legal departments can leave behind any uncertainty over what’s generating value in legal spend.
“Inflation, economic uncertainty and the pandemic are putting pressure on legal departments to improve collaboration, control costs and allocate limited resources wisely.”
Automation is another capability that can bring more value to your department in the form of time savings. Features such as automatic invoice intake can allow attorneys to spend less time on mundane tasks and more time on strategy. AI solutions add to the benefit of time savings by helping fuel analytics and efficiently surfacing more valuable insights. AI can provide leadership with a view into the effectiveness of their outside counsel spend, including highlighting opportunities to reduce spend where necessary, such as bringing more work in-house for a lower cost, reallocating work to different vendors or reducing the number of vendors being used.
Housing information in a centralized system can facilitate increased collaboration. Emails, documents and invoices between your in-house legal team and vendors can be easily misplaced or overlooked. To avoid confusion, issues or time wasted attempting to locate that document you need, seek a legal tech solution that provides a shared, collaborative portal.
The most critical step in this process is setting your solution up to succeed within your organization and that often requires establishing buy-in from multiple branches within the business.
While the solution addresses common pain points felt by most of the legal team, motivating busy employees to learn new systems and habits can be difficult. The in-house legal team needs to recognize that the organization is adopting a legal tech solution to streamline processes, save time and yield strategic insights instead of merely adding another tool that creates an extra step to their daily work.
Lastly, in the early months of integrating your new solution into daily operations, your employees may require some accountability measures to ensure they are not only using the solution but using it properly. Establish one or two people to champion the initiative and help their peers get the most out of the tool and maximize success.
Inflation, economic uncertainty and the pandemic are putting pressure on legal departments to improve collaboration, control costs and allocate limited resources wisely. But risks await legal teams that rush into integrating a legal tech solution. Take time to determine your needs, find a solution with the best technology that meets those specific needs and invest time to integrate the solution into your team’s workflow by establishing an innovative culture from the top down. Legal technology can help your employees identify value and unlock data-driven insights to ensure you are making the right decisions for your business.