This website uses cookies

This website uses cookies to ensure you get the best experience. By using our website, you agree to our Privacy Policy

Samuel Moore

Innovation manager, Burness Paull

Quotation Marks
If every innovation project works out perfectly, you need to question if you’re really ‘innovating’ at all

Leveraging the Advantages

Business
Share:
Leveraging the Advantages

By

Success is when innovation and technology meet in the middle, says Sam Moore

The adoption of legal technology can present a unique challenge for medium-sized firms. They don’t typically have the same sized budget as larger national or international operations, so investment decisions need to be carefully weighed. At the same time, mid-size firms can have a sizeable headcount of fee-earners to train, meaning they are sometimes less agile than boutique firms who are able to test the waters at a lower level of commitment. This is not to say that they can’t benefit from the latest innovations in legal technology – quite the opposite is true. To set itself up for success, the mid-size firm needs to carefully leverage its advantages, while compensating for its limitations.

ADVANTAGES

It’s likely only a handful of people need be involved in getting a pilot off the ground versus the bureaucracy commonly found in a major firm. The mid-size firm will typically have several distinct teams and areas of practice, giving the option of running smaller scale pilots – perhaps involving a single team. The mid-size firm is also likely to have supporting roles available in information technology (IT), human resources (HR), and risk and compliance. Take advantage of the personal relationships between the heads of these roles and your innovation champion. That personal connection between the stakeholders is a key advantage – larger firms can struggle to make those connections meaningful while smaller firms may simply not have the people available. Success begets success. In the mid-size firm, it’s often easier to build your individual reputation and capital among the partnership, which will lead to being trusted with larger transformative proposals. And pricing is getting better. Most legal tech products enter the market at a sizeable adoption cost, but prices tend to come down over time. Flexible pay-as-you-go solutions are quickly becoming the norm and up-front costs are becoming rarer. The mid-size firm might never have the buying power of a major firm, but most legal tech products are still within your reach with smart negotiation.

CHALLENGES

Budget will be your major challenge, both in terms of dedicated funding available and the number of gatekeepers involved. This can be the most challenging aspect of innovation for the mid-size firm – you’re likely too small to have a dedicated research and development budget, while simultaneously being large enough that spending proposals need boardlevel approval. The best approach is to always have a solid business case underpinning each proposal, and to be flexible in terms of scale. It may be necessary to run much smaller proof-of-concepts before approaching the board for larger funding decisions. Beware of blockers. In the mid-size firm there’s greater scope for an individual person in a position of influence to inhibit change. There are many reasons why someone might resist change, but whatever their rationale you will need to find a way to win over influential doubters. You can make this process significantly easier by appointing a board member to have overall responsibility for innovation within the firm, opening up the option of board-level influence to resolve obstacles. The array of options on the market is overwhelming and the fear of making a bad investment decision can easily lead to option paralysis. The important thing is to do something. Reflect regularly on your projects and be ready to quickly drop any which aren’t working out. Understanding data security concerns takes specialist knowledge. Those in larger firms typically have access to information security experts, but in the mid-size firm it may fall to an existing role to take on this additional responsibility. You may also need to deal with stakeholders who don’t fully understand the risks of exposing client data to third parties, which will be a necessary aspect of how many innovative systems operate. Not everything has a return on investment. This requires a big change in mentality at senior level. Most boards will be accustomed to seeing IT budgets with a clear benefit set against each line item. This is not necessarily the case with innovation projects. Some will work out incredibly well, others will be technically successful but underwhelming while others will fail completely. This is normal. If every innovation project works out perfectly, you need to question if you’re really ‘innovating’ at all.

TRENDS

There are a few trends in the market which mid-size firms should keep track of. Supplier competition is heating up in several areas such as document automation, e-discovery and contract review. Most solutions are now offered as cloud-based systems with minimal up-front costs or systems configuration, allowing the savvy buyer to test out multiple solutions to a given challenge.

Take advantage of this and ‘try before you buy’. We’re also seeing a period of consolidation in the legal tech sector but this can be a mixed blessing. The injection of capital and backoffice support can ensure the longevity of a particular point solution. On the other, many legal tech start-ups have been acquired only for their most exciting features to be shuttered, or absorbed into existing products which may be ill-equipped to leverage them. A wise buyer should be keeping their tech estate under constant review, with an exit plan (set out in contract) for any particular piece of technology. One of the biggest challenges in innovation/ legal tech can be just getting started. The best and maybe the simplest advice is – start with the problem. T

ake the time to really understand where your fee-earners are experiencing pain. Crowdsource this information among your teams. Identify a task which is done frequently, takes longer than it should, and probably doesn’t ever get invoiced. Once you’ve identified a challenge, run workshops to design what the perfect solution would look like. While aiming for the perfect solution, be prepared to compromise on nonessential features later in the process. Technology may not even feature in your solution at all – this is a perfectly valid outcome. Innovation is about people and processes as much as tech. If new technology is definitely needed, only then should you engage with the market.

Talk to vendors about your specific challenge, and seek views from your peers on how they would approach it. Be clear with suppliers about your desired outcome and challenge them to show you how they could help. Don’t be afraid to spend smaller amounts of budget on limited proof-ofconcepts with clearly defined outcomes. Better to spend a little money ensuring you’ve got the right solution, than lots on the wrong one.

The overall message is this: innovation and legal tech are not just for the big firms, the alternative legal service providers and the Big Four. Though some individual solutions could be beyond your budget, most technologies can be accessed at varying price points depending on your needs.

The most important lessons I’ve learned over the course of four years leading a midsized firm’s innovation agenda are: — Put someone specifically in charge of innovation, then give them a clear reporting line to the board.
— Set aside some budget for innovation projects and get comfortable with varying returns on investment.
— Find enthusiastic stakeholders in all parts of the business, not just fee-earners – you will need cross-team support on almost every project worth doing. — Don’t be afraid to talk to your clients about your projects. In fact, many clients have expressed to me a real enthusiasm for hearing about the latest projects – even if they don’t work out.