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Jun 8, 2018
Legal Tech and the Changing Legal Services Industry
Weekly Update - June 8
A. Quote of the Week
“Technology will be the main driver of this change. And, in the long run, we will neither need nor want professionals to work in the way that they did in the twentieth century and before.” (Richard Susskind)
B. Articles to Read
1. Different Ways For Firms to Capitalize on Legal Tech
Law Firms Are Investing in Tech Before It Overtakes Them
(Rhys Dipshan and Roy Strom)
“The trend toward melding tech into law firms’ core business comes as both a response to a shifting legal market, where firms’ traditional business is coming under increased competition, and as a realization by firms that they are well-positioned to capitalize on the demand for tech and data-enabled services. And it is fundamentally altering what it means to be a law firm in the 21st century.”
Why it Matters:
This article provides an excellent snapshot of how some proactive firms are navigating the world of legal tech. Some have created their own incubators; some are building internal products to make their own processes more efficient and gather more data; others are investing in legal tech companies or entering into strategic partnerships.
But of course, not all legal tech companies need to be started by non-practising lawyers. Firms have access (as Zack Abramowitz points out) to three things that most legal tech companies do not: significant resources, an in-depth understanding of pain points of the legal industry; and access to clients who trust them. Enterprising firms may be well positioned to create the next generation of legal tech companies.
2. The Competitive Advantage of Law Firms
Law Firms Should Build Digital Products
“A firm with 1,000+ lawyers has quite a bit of legal know-how. Collecting that know-how and transforming it into a user-friendly workflow is the basis of many great digital products. QuickBooks and TurboTax are digital representations of the workflow accountants used to serve their clients for years; Kayak and Concur have replaced the travel agents by delivering their travel packages in digital format; and Wealthfront and Robinhood invest portfolios using algorithms that leverage years of real investor experience.”
Why it Matters:
This article highlights some of the challenges affecting the law firms (changes in client expectations, increased competition, etc.) before reaching a similar conclusion – namely that law firms, with their access to capital, access to clients (who can provide regular feedback), and knowledge of the legal space, have an undervalued competitive advantage as compared with legal tech companies and other entrepreneurs. However, as the authors note, prioritizing the software as the future method by which legal services will be delivered will require a fundamental shift in how lawyers view the legal profession and will require a shift law firms’ personnel, business models, and marketing tactics.