This article takes a closer look at how digital transformation (DX) is changing the existing landscape in the legal sector. We also offer an opinion on what the future might hold.
Digital transformation - legal eagles taking flight
Change in the legal industry has historically been slow, but this may all be about to change due to the needs of both consumers and business. These needs are driving change through the use of the technology to stay competitive because digital transformation offers the legal industry the potential to transform the way in which services are delivered both internally and externally.
Digital transformation - changing the rules
Law firms are taking the opportunity that digital transformation offers to become more client centric. Below we look at some examples of how digital transformation has already impacted the legal industry.
- Going paperless – Moving to e-billing was a step forward for the legal sector but in recent years this has expanded to digitizing and storing files. Moving documents into the Cloud has reduced costs and also increased productivity. By using powerful digital workflows, a firm can create an efficient way of handling, storing, and managing vast quantities of documents and paperwork. Judicial systems are also increasingly using electronic filing.
- Remote, virtual and flexible working – By using mobile and cloud technology, law firms have been able to become flexible and responsive regardless of location or time zone as well as offering a healthier work life balance for their employees. The rise in virtual law firms and the growing gig economy mean law firms can tap into external resources as required.
- Online courts – Citizens and business will expect simpler, online processes in the court systems. The Canadian Civil Resolution Tribunal (CRT), which has been active since 2016, is continuing to challenge how the law should be carried out.
- Due diligence and document discovery – In November 2019, Forbes reported on how much faster and accurate machines are at sorting through documents and finding relevant content. This use of AI (artificial intelligence) in the form of automation and predictive coding is starting to play a small but important role for legal experts. Such automation can remove hours of administrative work, releasing lawyers to focus on more valuable activities.
- Billable charges – As well as enabling clients to pay via online services law firms are changing their entire billing model. As AI improves efficiency, law firms are increasingly moving away from the traditional method of charging by the hour. Instead, we are seeing an increase in the use of flat-fees for work and alternative ways to charge for services. New billing models are being welcomed by clients because they are more transparent and share the risk more equally.
- Competition – Digital transformation has seen a rise in competition from online services providers, including the rise of online processing for everything from the creation of parking tickets to divorces. This makes legal services more readily accessible to people, as well as helping to simplify the complex language associated with the legal profession.
Digital transformation - what’s next?
Technology doesn’t stand still, and with events such as the
Global Legal Hackathon, innovation will continue to build and transform the legal sector’s landscape. New technologies have not yet reached their full potential, but the impact will undoubtedly be felt in most law firms.
- Blockchain – The future of this technology and its impact on the legal industry is still up for debate, but it is clear that innovations such as smart contracts will remove the need for arduous and repetitive legal work. We may see a hybrid system where smart contracts are automated but ultimately managed by lawyers.
- Technology specialists – With the growth of new technology, the law must respond. This leads to a rise in the need for legal specialists in everything from cryptocurrency involved in a divorce settlement through to the complexities of managing contracts within blockchain.
Digital transformation - tip of the iceberg
The legal industry is already changing because of digital transformation. For those wanting to succeed in the legal sector, being a techno geek may be as important as being a legal eagle, or at least, having experts on your team who can help you embrace new technology to remain competitive and relevant. While much change is anticipated in the legal industry, the change has only just begun.
Part 1 -
How Digital Transformation (DX) is driving change in key verticals
Part 2 -
How Digital Transformation (DX) is driving change - Legal
Part 3 -
How Digital Transformation (DX) is driving change - Education
Part 4 -
How Digital Transformation (DX) is driving change - Finance
Part 5 -
How Digital Transformation (DX) is driving change - Manufacturing
What other changes have you seen because of digital transformation? What do you think will change in the future for the legal industry? Please share your thoughts with us by using the below comments section.