In recent weeks there has been a lot of debate about the future of technology and NewLaw in the Australian legal landscape. A recent survey by the Association of Corporate Counsel Australia highlighted that only a portion of its members, 14% (down from 18% in 2014), have used NewLaw providers in the past year, and 70% are not familiar with these models, which typically incorporate virtual firms, LPO’s (legal process out-sourcing), ELM (enterprise legal management) and contract or secondment firms.
The barrier that was identified to this slow uptake was a failure to understand what these new services offered. A number of hypotheses form at this point: is this due to poor marketing strategy by these alternative firms, who have been unable to effectively demonstrate the benefits and opportunities that their technology could enable for corporate legal teams?
Or is there a cultural aversion to technology on both sides of the Australian legal industry – in-house legal teams and law firms?
2015 research by the ALPMA supports this perspective, highlighting that there is a general resistance to change by law firms.
InfoTrack, a technology company, also confirms this, with recent research that found “lawyers’ resistance to technology … was the main factor inhibiting firms from implementing new systems to boost efficiency and productivity” as reported by the Australian Financial Review’s Marianna Papadakis.
InfoTrack’s CEO, John Ahern, clarified this further by saying that lawyers will only adopt technology if it not only drives efficiency but it is also simpler than a manual process.
This attitude may reflect the risk averse nature of many lawyers, but it also highlights a sensible, practical approach to change that all legal technology businesses need to listen to carefully.
The message is clear: any technology needs to be simple to use, be easier than the manual process, create efficiencies and deliver a better result than what lawyers are currently achieving.
However, I believe that this slow uptake of NewLaw is not just about reservations about technology; most people associate NewLaw with cheap or low cost, and that is just not always the case.
Although most NewLaw businesses focus on creating efficiency that may lead to a lower price, many of the services also improve the quality and create tangible value that in-house teams can then pass on to their companies.
The reality is that many companies are not looking for low cost law firms, but they have a very real need for transparency over their procurement process and legal budgets. Technology can provide solutions for this that do not necessarily involve reduced fees paid for legal services, however the benefits of visibility, accountability and control are significant.