Technology as Opportunity for Law Firms
Technology is both a threat and an opportunity for law firms. On one end, technology has opened the door for market disruptors like LegalZoom and Rocketlawyer who provide some legal services faster and cheaper than law firms. Some of the low-hanging fruit that law firms and attorneys used to be able to count on is disappearing--or long gone. In a recent research study by Altman Weil, 21% of law firms surveyed said technology was a threat right now, and 53% of firms described technology as a future threat. But in many ways, technology is an opportunity for law firms. The proper technology can help law firms be better and faster, and it can provide law firms with the ability to provide clients with helpful information and analysis much faster than ever before. In our final installment of Re-Envisioning the Law Firm: How to Lead Change and Thrive in the Future, the survey from MPF Insight, the National Law Review will offer an overview of the recommendations surrounding technology in law firms offered in the survey.
Robert A. Young Former Chair, ABA Law Practice Division:
Technology has been increasingly important for today’s law firm with many experts predicting that it will soon surpass rent as your firm’s #2 expense after salaries. The time has come for managing partners to take a stronger and more proactive role in learning more about this vitally important area.
Having a plan for how technology fits in with your firm’s practice is a crucial part of any leadership strategy. Additionally, having an effective and robust cybersecurity policy in place is essential in today’s data-driven world.
Law Firms are investing more in technology. In 2016, firms surveyed increased law firms increased investment in the following areas by the following percentages:
- Cybersecurity, 23% of respondents increased investment
- Website, Internet & Digital marketing, 20% of respondents increased investment
- Case Management Software, 12% of respondents increased investment
- CRM & Database, 10% of respondents increased investment
- Competitive Intelligence, 5% of respondents increased investment
- Legal Research, 2% of respondents increased investment
For obvious reasons, Cybersecurity is the top area for new investment with law firms. In fact, a Chase Cost Management survey report released in 2015 showed that AMLaw 200 firms spend an average of $8,000 per full-time equivalent on information security. As a major concern for law firms and their clients it is imperative that firms have all employees trained and all client data safely secured. Having cybersecurity as a living breathing part of your technology plan can help you reap the benefits of technology safely, and your firm and your clients will benefit. However, good cybersecurity isn’t simply changing your password every six weeks; it is a vital skill set that must be understood from the top down.
Sharon Nelson, president of a digital forensics, information technology and information security firm says:
If your management mindset isn’t there, you are stuck in technological obsolescence. Good cybersecurity is good risk management, and better yet, a marketing tool to use with clients. Don’t just delegate this, that does not work. Learn it yourself, as much as you can-and lead by being knowledgeable--that’s how you ensure the future of your firm.
Website, Internet and Digital marketing is another area of growth in terms of law firm investment. Digital marketing tools can help a firm better target their marketing activities. Re-envisioning says, “The reach is as big or as small as you want it to be and the subject matter can be much more focused, speaking directly to industries and communities through email and social media channels.” By using the technology and data-gathering tools available, law firms can maximize their digital footprint and reach many more potential clients.
A final recommendation from the survey, “Don’t be held hostage by your technology vendors.” By embracing open-sourced Customer Management services and web development platforms, your firm can create a product that works seamlessly into your processes. The time and effort put in up front will pay off with the flexibility available in the end.
Technology is not going away, and the negative elements of technology are already happening. In order to enjoy the benefits technology has to offer, Law firm leadership needs to find the ways that technology can benefit their firms, their attorneys, and their clients.
This is the sixth article in this series. Please find the earlier articles below: