LawFest organiser Andrew King continues a series of interviews with key legal professionals with their innovation and technology stories.
What does legal innovation mean to you?
Legal innovation, to me, is the means of progression a law firm (or lawyer) uses to improve their service offering and profitability.
What role does technology play in innovation?
Technology is an essential part of innovation: that is where efficiency is realised. For almost its entire history, humankind has used one tool or another to increase the output of the individual person. Technology is a multiplier of effort, meaning that one person is able to produce several times more output than normal. For example, a person harvesting 100 trees with logging machinery will be more efficient than if the person used a chainsaw, though a chainsaw is more efficient than using an axe.
What pressures are organisations facing in the delivery of legal services?
The pressures facing organisations in the delivery of legal services are mainly external: a tight labour market; changing social values, greater competition and substitutes; consumer sensitivity to price; greater expectations as to speed. Internally there is the pressure of partners wanting to exit firms, so finding the cash to pay them out. In a regulation sense, the restrictions around third-party investment and diversification of governance boards. Some of the change is well overdue (eg, #metoonz).
What developments do you see in how legal services are delivered?
More video-enabled services allowing lawyers to beam in to remote areas, or work away from the law firm’s location. A revamp of what practice management software does with more focus on CRM, document management functionality and a move away from hourly billing. Some use of enhanced machine learning services provided from offshore – this is now possible due to the settlement of the Microsoft v US Government case (with the CLOUD Act passed into law last year).
What opportunities has legal innovation brought to you?
Legal innovation has enabled me to expand into other parts of the country fairly quickly. For example, hiring lawyers to work in Blenheim has been challenging, so we don’t yet operate a branch in Blenheim. Our lawyers from Christchurch and Timaru service the area, which accounts for around 20% of our caseload.
We’ve grown our business at a good clip and we have done this almost exclusively on legal aid. Surely, this is evidence that innovation has a direct relationship with efficiency! We are taking all the profit we realise and sink it back into the business to continue this growth. For those who don’t know, legal aid fees are between 30% to 50% of what we charge privately. So we also have the choice of charging what other law firms charge, and returning hyper profit, or offer competitive pricing strategies to take market share from other firms.
What are some of your tips to start innovating or developing an innovative mindset?
Read some books. I recommend The Goal by Eliyahu M. Goldratt; Our Iceberg is Melting by John Kotter, and; Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter. If you don’t have your head firmly in the strategic space, you won’t be able to effectively choose your technology path.
Hire someone who knows the law profession and technology. Don’t try to feel your way around … it’s too important a decision to just go with who has the shiniest brochures, or what vendors tell you that you need. You need to project future need rather than focus on instant solutions.
Why is it important for legal professionals to continue to learn about legal innovation and leveraging technology?
The biggest challenge firms face around innovation is about the gaps that exist between the profession and other sectors of business; so the critical task to consider is need identification. Because law firms have weakened governance structures (due to any non-lawyer being statutorily banned from partnership or directorship status) there is a tendency to have a low risk horizon, resulting in a lack of strategic insight.
Erin Ebborn has been a speaker at the legal innovation and technology event LawFest.