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Investing in legal technology is costly, both in terms of finance and time, so how can small and mid-sized law firms hope to compete with their larger competitors in this area? Jenny Rayner talks to a range of experts about their experiences.
Ben Wightwick, product director of HighQ Publisher and former winner of the KnowList Awards Legal IT Rising Star
Stephen Roper, professor of enterprise at Warwick Business School
Trevor Worth, CEO and founder of the award-winning small law firm, Portcullis Legals
‘Innovation teams’ are becoming increasingly common within UK law firms. Tasked with keeping abreast of technological developments and spotting new innovations on the market, they also often command their own research and development budget. For many small and mid-sized law firms, however, having a team—or even an individual—dedicated to following technology trends is far from realistic. Nevertheless, the benefits that even the simplest legal technology brings can give smaller firms a significant advantage in the market place and put them on an even footing with their larger competitors.
Ben Wightwick, suggests that whatever your starting point law firms of all sizes have one thing in common—the need for success: ‘Technology these days, regardless of the size of your firm, can be an enabler to success. Modern platforms can level the playing field considerably. From benefits like improving your security standing, to being at the cutting edge of technology, through to providing a platform to which creates a competitive advantage. Technology is largely a commodity—it’s up to the firm to leverage it to create the value.’
The Solicitors Regulation Authority (SRA) and Legal Services Board recently published a report on ‘Innovation in legal services.’ Stephen Roper, one of the report’s co-authors, identifies the benefits that small and medium firms are already witnessing, ‘new technology has driven higher profitability and often new ways of working’. ‘More IT-based document storage and case management systems have enabled faster, value-for-money services to clients, and released time for personal consultations.’
Ben Wightwick agrees. ‘it’s now a common thing for smaller firms to compete with the larger more well-known brands leveraging technology to deliver an improved service in a very competitive market’. He adds that ‘firms of any size can build products and services with off the shelf products which can provide better value added services or even new revenue streams for the firm’. And it’s not just traditional law firms who are gaining the competitive edge as Stephen Roper explains, ‘developments such as Alternative Business Structures and new entrants from other sectors are making the legal services market more competitive. Using new technology can help firms to compete and remain profitable in the long term’.
With law firms of all sizes and other industry players benefitting from legal technology, there is a danger that small and mid-sized firms will be left behind if they don’t engage at any level. A simple example surrounds recruitment. Reports show that the majority of job searches are now conducted on mobile phones—and this by no means refers to millennials alone—meaning that if a firm’s website isn’t mobile-friendly then the likelihood is that candidates will simply move on. And if a firm fails to recruit tech-savvy intakes, there will be no one to champion technology internally making it even harder to catch up.
Trevor Worth, explains the risks to small firms of disengaging with technology developments. ‘SME’s have to embrace technology or they risk the erosion of their businesses and once that decline starts, there will be a near impossible climb back to the market as more nimble, forward-thinking innovative players will fill the gaps.’
There are many factors at play in the decision to invest in legal technology, and some are especially pertinent for smaller firms. Trevor Worth identifies three recurring issues:
These are genuine concerns, but as Trevor Worth explains, the benefits should outweigh the costs:
Technology can drive efficiencies and improve revenues in areas such as drafting, precedent decision-making and marketing. It will obviously have an impact on both the amount of human resources needed and the increased capital investment needed for the new technology, but this should be viewed as an essential and long-term investment in the longevity and strategic planning of the business."
There is a baffling array of legal technology solutions on the market, and so for small and mid-sized firms taking their first tentative steps into legal technology, it can be difficult to know where to start, especially as they are unlikely to have a dedicated manager or team to oversee the process.
An obvious first place is to ensure the firm’s has an on-line presence and the website is both user-friendly and interactive—this has the added benefit of attracting IT-savvy recruits.
‘Internally, cloud-based storage and IT systems to manage case progression are increasingly common. Firms’ web presence is now vital, and marketing through targeted social media campaigns is being used by some of the most innovative law firms’ says Stephen Roper.
Perhaps more important, however, than the choice of technology is ensuring buy-in from stakeholders and staff, as Ben Wightwick explains, ‘the most important thing to consider when buying new technology is not the technology itself. You have to take your stakeholders on a journey. Clearly communicate the objectives and goals and explain the benefits that either their clients or themselves directly with get from this new “shiny” technology.’
Stephen Roper agrees, says his company’s research found there are resource barriers related to technology costs and the time taken to implement new technologies. ‘More important however are attitudinal barriers—staff may be resistant to changing working practices and small firms’ customers may not like changes in the way law firms work. Introducing new IT systems almost always takes longer than firms anticipate. Careful contingency planning to maintain customer service during the transition is critical,’ he adds.
Of course, technology has a habit of moving on—investing in technology cannot simply be a tick box exercise and then forgotten about. Trevor Worth explains his approach. ‘It is important that colleagues and leadership teams are encouraged to keep abreast of innovations within the sector and to be actively involved in feeding this back to the decision makers. In our firm we actually make innovation one of our key performance indicators for the whole team, whatever their role. This encourages participation and engagement and this is a major boost to a small firm’s ability to stay ahead of the curve. It is not the responsibility of a single person or an “Innovation Department”, it is everyone’s responsibility to play a part in embracing change in technology or any other aspect of the firm’s activities.’
With this approach, the advantages that ‘innovation teams’ bring to larger firms become less marked. And on a level playing field it really is anyone’s game.
Interviewed by Jenny Rayner. The views of our Legal Analysis interviewees are not necessarily those of the proprietor.
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