It's that time to dive into the crystal ball and tarot cards to give mine and the teams take on what 2022 will bring for Innovation and Legal Tech.
I've tried to focus on new trends, with the accepted continuation of technology adoption, automation and AI.
I await 2023's taunting of nyah nyah nyah nyah nyah proving us wrong.
Over the last couple of years, our clients have been increasing their investment in technologies to help their in-house legal teams organise and improve the delivery of their legal work. Whilst these technologies can increase the quality of work and output, there is a lot of preparation required when it comes to ensuring internal processes and documents are fit for purpose before implementing these systems. Technology vendors providing the software often do not have the expertise or resource to assist with this, and our clients are then turning to us for help with this preparation.
With so many different technology solutions available, it can be hard for a client to know which to choose and whether it will really help to solve the problem. As a team that researches and pilots so many of these technologies, we are now increasingly introducing our clients to these technologies to help them best solve specific pain points.
It used to be the case that 'The Big Four' provided consultancy services and law firms offered legal services. As the former have spun up their own legal departments, it seems law firms are primed to reverse this trend offering consultancy services alongside the traditional legal services as part of an engagement. It is a trend we expect to see continue this year, with a rise in law firms adding technology consulting to their rosters. It will be interesting to see who has the appetite and knowledge to really drive this service forwards in 2022 and actually provide clients with the much needed support and insight they urgently need.
We have been involved in many conversations with clients about improving their contracting approach within their business, with a focus on consistency, transparency, speed to contract and reducing risk. This past year has seen an increase in companies purchasing Contract Lifecycle Management (CLM) software to try to deliver this new and improved method of contracting, however what we are seeing is that there are many other facets to a successful implementation than just choosing and purchasing the correct technology.
Legal teams are being asked for precedents, clause banks, templates, playbooks etc. as part of the implementation for a CLM and are quickly realising that there is a lot of work that needs to go into their contracts that it will require in depth and time intensive legal work. The nature of a CLM means that inconsistencies or errors from the outset have the potential to be multiplied 100 fold across the business post-launch, so reviews and re-drafting of out of date or inconsistent agreements is required before any data is uploaded to a CLM.
We will all have seen some failed CLM implementations in the market due to an inability to coordinate this effort and we are now supporting several clients on the legal and technical challenges of such a large undertaking. We expect to get more requests in 2022 from our clients to help them rework precedents and specific clauses to fit into new contracting approaches across their business.
As a law firm we hold vast amounts of client data. Traditionally when firms look at data they focus on the operational side. We believe there is even more to be gained for our clients by diving deeper into the data we capture from the legal matters we advise on.
There is the potential for insights to be gained from identifying how to structure deal terms or contracts for our clients, essentially identifying their preferences for the legal documents we create. We will also be able to identify trends and verify those against the sector for our clients.
Expect to see teams like ours to start investing in data scientists, to analyse the data and structure it, intertwining data expertise with legal technologists and wider innovation teams to establish the best ways to add value to in-house legal departments.
Consolidation and Integration of Technology
The legal technology market has seen the proliferation of point solution technologies in the last couple of years, fuelled by PE and Enterprise company investment. Whilst some of these technologies have their place and do scratch an itch, they only offer a limited opportunity for a return on investment, which we have to carefully track to ensure they continue to do so as we invest in them and increase their use.
Our approach to increasing ROI is to use our development resource to integrate these point solutions into other technology platforms to utilise them (where possible) beyond their original use case. These take the form of products that our clients can take advantage of or internal tools that enhance how we deliver specific areas of legal work.
With all of the technologies available, this also brings the challenge that our lawyers may become overwhelmed with the number of systems to access for all of the different facets of their work. For this reason, we are constantly reviewing the technology we own, understanding newly released features to consolidate them where possible. At times we may give up features for a simplified user experience, with the added benefit of saving on our technology spend.
Other firms will have a similar approach and will be looking at their own consolidation and development plans.
I would also anticipate the acquisition of point solutions to continue by some of the bigger platform players, but expect them to be more considered and an overall smaller number of deals.
Legal Technologist Career Path
Whilst Legal Technologist / Legal Engineers have become established roles over the last couple of years, the paths to move into these roles hasn't always been clear. We saw a few firms last year start graduate schemes focused on providing this path, of which we were one bringing 11 graduates in for our first cohort. We are currently planning to run a second cohort this year and I would I expect many more firms will take their first steps to running their own schemes.
It won't stop at graduate schemes either, we are already looking at providing other routes into the team for people from diverse educational backgrounds, in a bid to create more roles in this quickly growing sector of law.
So in a year where we can only expect technology advancements to continue to be super charged, so too will be client expectations and rightly so. As we continue to deal with I hope the lessening grip of the pandemic (I almost got through a whole post without mentioning it), legal technology will be the key to meeting client demands, but for those who are willing to push themselves outside of their comfort zone – 2022 is the year to play for and stay competitive.