Legal Tech Implementation
Legal tech is the catch all term for any technology implemented by legal teams. As a result, in practice the legal tech sector is extremely broad covering everything from generative-AI through to process automation and e-billing platforms.
Perhaps because of this, a recent poll of legal and compliance leaders carried out by Gartner confirmed that 63% of respondents were planning on accelerating investments in legal tech whilst at the same time 34% had frozen hiring and 9% were reducing legal headcount.
As a result, legal tech remains on Chief Legal Officers and General Counsels’ radar and strategic planning. In this article we review what this actually means in practice and, based on our experience of implementing legal tech projects, our recommendations on how to approach legal tech projects.
What is legal tech?
As noted above, legal tech is the catch all term for any technology implemented by legal teams. A few of the more common examples / terminology are:
- LLM (Large Language Models): the most commonly used example of this is ChatGPT. As one expert described it – it’s your iPhone’s predictive text on steroids.
- Document automation: creating contracts from templates with minimal user inputs in a controlled workflow. This can also form part of Contract Lifecycle Management (CLM) solutions.
- E-billing platforms: moving away from manual invoice processes to an electronic platform that allows for a company’s data on spend with its external legal providers to be structured and easier to analyse.
How to identify a successful use case?
Firstly, you need to review the context of your company and legal department. If you are the sole in-house lawyer in a company of 20 people, a legal in-take / triage tool is unlikely to bring sufficient benefits to justify the spend or materially increase efficiency. Therefore, the key factors for a successful use case:
- Bottlenecks – map out your internal clients’ customer journey. Are there any pinch points and, if so, what’s causing them?
- Repetitive tasks – if the same task is identified as being required to be done numerous times (whether by an individual or multiple people within an organisation), can it be automated?
- Baseline data – do you have the baseline data to identify what your internal legal team is spending time on and what is currently being outsourced to 3rd parties?
The above factors will help answer the most important initial question:
What problem am I trying to solve with legal tech and why?
Return on Investment (ROI)
We’ve seen a number of legal teams struggle when it comes to calculating a potential return on investment (ROI) of a project. This is partly because such analysis is not necessarily common for lawyers and partly because it can be difficult to identify the benchmark data required to give an accurate ROI.
We would suggest the following elements are likely to be relevant to any legal tech project:
- Quantitative:
- Calculate the current ‘human’ cost of the task (salary cost, overhead, etc.)
- Estimate the time taken for tasks in a workflow
- Comparison with alternatives (e.g. increased headcount, cost to outsource, etc.)
- Qualitative:
- Risk management (e.g. consistent implementation of company’s risk regime)
- Appropriate allocation (e.g. lower value matters can become self-service within a controlled framework, freeing up legal resource to focus on higher value matters)
- Efficiency (e.g. improving response times and not being the bottleneck whilst maintaining quality)
At Lex Stratum, our team has first-hand experience of scoping and implementing legal tech projects. We are independent and therefore can provide unbiased advice through our consultancy services.
For more information, please email us or book a call via our website www.lexstratum.com.
Further reading:
https://www.gartner.com/smarterwithgartner/5-legal-technology-trends-changing-in-house-legal-departments (Gartner’s 2023 Top Legal and Compliance Technology Predictions)
https://legal.thomsonreuters.com/blog/technology-in-law-is-the-new-norm/
