White paper
How legal technologies can help law departments in uncertain times
Law departments’ reliance upon many legal technologies has increased in recent years.
But as in-house counsel are now thrust into new ways of working—often remotely—legal technologies that provide both expert legal guidance and data-driven legal operations management have become even more vital to the life of the law department.
As recently as a few months ago, it would have been inconceivable that law departments would be forced to support an entirely remote workforce. But in today’s environment, that’s exactly what happened. On top of that, the businesses those law departments support have faced severe disruptions, and they need responsive and on-point legal guidance for often-unexpected business challenges. Business partners still expect the same level of service—now within the strict constraints of limited in-person interactions and ever-changing governmental regulations.
In today's world, law departments need to be planning for a new future filled with a host of challenges:
- Working remotely efficiently and effectively, while keeping talent performing
- Building expertise in emerging and unfamiliar practice areas
- Meeting the business’ growing demands upon the law department
- Doing as much or more work with fewer staff
The good news is, as innovative, modern law departments facing new crises have done for decades, the current conditions presented can be addressed, at least in part, by a smart and focused legal tech strategy.
The case for legal technologies’ increased role
In his article "The Legal Function Reimagined: A Closer Look at the ACC 2020 Chief Legal Officers Survey“ in Forbes magazine, author Mark Cohen says that legal technologies are the key to meeting the increasing demands placed upon the law department, such as driving efficiency; detecting, calibrating, and mitigating financial, business, and legal exposure risks; and creating automated self- help tools, among others.
Cohen continues by describing CLO’s—and, by extension, their law departments—as business collaborators/partners whose recommendations must be data-driven and holistic, balancing enterprise risk tolerance with reward. He explains this approach to risk is different than the traditional legal risk mindset whose hallmark is mistake avoidance.
A recent survey by Thomson Reuters and Acritas, now a subsidiary of Thomson Reuters, backs up these findings. Respondents to the 2020 State of the Corporate Law Department survey indicated that the law department has 3 top priorities: improving functional effectiveness, increasing efficiency, and safeguarding the company.
In the remainder of this white paper, we’ll explore how legal technologies for both legal guidance and for law department management play a key role in meeting these priorities.
Improving functional effectiveness and increasing efficiency
With the law department expected to function as a more effective business unit, aligning with the organization's goals and supporting its profitability, law department leaders are employing legal management technology to provide data analytics.
Law departments must also find ways to measure the value they are bringing to the corporate table, including demonstrating how they have controlled costs. In this challenge as well, legal management technology helps the law department meet it.
Legal management technology can also improve the efficiency of legal workflow and the quality of work product for the law department by reducing wasteful duplication, among other advantages. Functions provided by these legal tech tools include matter management, contract lifecycle management, document management, and legal project management.
Lastly, any discussion of efficiency and effectiveness wouldn't be complete without also addressing the practice of law. Here, too, legal guidance technology that provides expertly curated, up-to-date legal information, as well as practical tools to apply that information, also improves the efficiency and effectiveness of the law department.
Safeguarding the company
Corporate law departments’ role in safeguarding the company goes beyond just mitigating a rising legal threat or navigating a regulatory entanglement. Safeguarding means ensuring the sustainability of the company and its business model and working in a way that gives the company the ability to face changing regulations, legal trends, and external threats.
The adoption of new legal management technology and more innovative methods are major components of the desperately needed transformation of often-outdated and manual processes that law departments employ to get their work done—and how that transformation is handled will be a key measure of law departments’ success overall.
Indeed, leveraging technology and data enables teams to work smarter, to better measure exposure, and predict where problems might emerge, enabling managers to deploy their resources in optimal ways. Ultimately, allowing the law department leader to be that trusted advisor to the business.
Maximizing attorney efficiency and effectiveness
For in-house counsel to even have any hope of having the time to serve as a trusted advisor to the business, attorneys must maximize their own efficiency and effectiveness in all aspects of their work.
Sarit Shmulevitz, director, Practical Law Bankruptcy at Thomson Reuters, is an attorney who practiced for 15 years in both corporate and law firm roles. As she explains, "When I was practicing, the biggest thing I saw young attorneys struggle with was lack of guidance and training. There is so much that goes into practicing law—it’s impossible to come into practice and be prepared for everything.”
What Shmulevitz said is so very true. The only way to be even reasonably prepared is to be equipped with the right legal guidance and management technologies for:
The practice of law
Whether an attorney needs to brush up on an old practice area or is expanding into a new one, having access to the most current, expertly curated legal information—and being equipped with practical legal guidance to apply that information—is crucial, saving time and making that attorney more efficient.
Managing workflow and automating routine tasks
Managing workflow allows attorneys to efficiently and effectively manage all aspects of a matter, allowing for collaboration both inside and outside the business and greater transparency for the business. Automating routine tasks speeds up manual processes and enforces consistency, reducing the opportunity for error and saving time.
Making data-driven decisions
To be seen as a co-equal business partner requires the law department to make decisions driven by data. And the only practical way to amass the correct data and properly interpret it is to rely upon legal management technology.
Safeguarding the company
Making data-driven decisions is only one part of being responsive to business needs. In order to have a seat at the table, in-house counsel must also understand fundamentals like finance principles and business basics to align the goals of the law department with the goals of the business.
In addition, the law department must make a 180-degree shift in its fundamental approach to addressing risk, from attempting to eliminate most, if not all risks (hence, being perceived as the Department of No), to understanding the priorities and goals of the business so that risks are assessed and properly mitigated. This way, the law department is seen as a co-equal, pro-active business partner and a trusted advisor to the business.
And all of this is only possible through reliance upon the right legal technologies.
Attracting top talent
Law firms have long known that to attract a top lateral candidate or to fill their ranks with the best young associates, legal technologies can frequently be a top factor when attorneys are thinking about moving into a new position.
Law departments don’t face that pressure as obviously, but they’re still competing for top talent—and lawyers talk to each other. In the end, it’s yet another reason that law departments must also become technologically savvy.
The reasons why legal technologies are so important to the law department’s recruitment efforts are simple: improving success and accessibility. Attorneys want to have access to any tool that gives them a better chance of success—in the office, at home, or in the local cafe. In many ways, they have as much at stake as the law department does in this move. If they feel the department’s lack of commitment to technologies could impede their chances of success, they are likely to put their reputation first, no matter how attractive the other aspects of the offer.
Using tech as a differentiator
When law departments make the commitment to invest in legal tech, they typically base the purchasing decision on the tangible benefits we've mentioned previously: efficiency, effectiveness, and risk mitigation, for example. What many law departments fail to consider, however, is how this technology affects the way they’re perceived by their business partners and those outside the business.
Law departments that position themselves as legal tech innovators are perceived by their business partners as savvy, data-driven business units. They gain the respect and the trust of the C-suite. Such earned stature enables law department leaders to have a seat at the table, and to serve as the business’ trusted advisors. They’re also more likely to be seen as peers rather than just clients by technology-forward law firms and are better positioned to take advantage of ALSPs and other legal innovators.
How will your company make use of legal tech in these uncertain times?
These are unprecedented times, and the full impact of the COVID-19 pandemic is yet to be realized. But some level of legal impact is a near certainty. Law departments that are prepared to step up their game will give their businesses a much better position to survive and thrive in a very uncertain market.
The leading law departments during this time will find ways to use legal technologies to streamline routine tasks, collaborate with business partners, and help navigate the challenges of the market. Now is the time to evaluate your law department's technology strategy and reconfigure it for the future.
