The Covid crisis has revealed the need for law firms and legal departments to digitalize rapidly and sustainably. While some are cautious about these mostly novel technologies, the majority has understood the importance of these tools for their growth, and even their survival. And legaltechs themselves are reaching maturity at the right moment.
Just three years ago, the legal world operated along traditional lines, with a lot of paper and time-consuming practices set in stone. Thanks to some early adopters motivated by the successful digitalization of other sectors, technology firmly has one foot in the legal world’s door, and now that door is opening wide.
Crises tend to accelerate innovation. And this health crisis is no exception. It has saved several years in the evolution of mentalities and the organization of work. According to recently-conducted surveys, the vast majority of law professionals believe that technology will have the greatest impact on their organization over the next three years. However, only a minority feels ready for this change. Additionally, almost all legal departments will expect law firms to employ technologies geared towards more productivity. The transformation is therefore inevitable, but will require a great deal of time and support from providers.
The boom in remote working will further accentuate this movement, notably to the benefit of collaborative work tools hosted on the Cloud, which are accessible from anywhere.
According to recent studies, lawyers have identified three priority areas for the digital transformation of their firms:
If the crisis highlighted the importance of legal tech, it also accelerated the selection process inherent in any emerging sector in the consolidation phase. At present, there are 250 legal techs in France, and in terms of volume, France is the second biggest market in the world. The number of legal techs is likely to decrease, as the trend tends towards the best performing players of each sector in the space to create associations with each other. The objective is to acquire greater economic robustness and to offer clients a comprehensive and interoperable service.
Lawyers and legal departments are in favour of these associations, as the multiplication of tools is often presented as an obstacle that creates difficulties in adoption and incurs additional costs. It is therefore beneficial to integrate the range of tools that respond to the essential needs of a law practice into a handful of programs.
A final powerful trend that emerged is the appetite of professionals for legal tech founded by former lawyers. This makes sense; it is about transforming specific practices and methods perfected over many years. The fact that innovation comes from within the profession is essential to gain the confidence of actors in a rapidly evolving space.
If legal tech companies were perceived as “poachers of the law” several years ago, their image has evolved and today there remains little doubt that they manage to achieve a positive return on investment. The best legal tech companies have trustworthy products and solid reputations. Consequently, the growth and attractiveness of the legal profession seems to be increasingly linked to technologies they adopt to improve their productivity and offer a new experience to their clients, whose expectations have also changed. Technology will enable lawyers to become even more consequential and “profitable” business partners for companies. It represents a competitive advantage, and is a win-win partnership.
2020, a very special year, will be among other things the year of legal tech companies. Now essential players in the legal world, legal tech will not replace lawyers, but will complement and enhance them.