How to implement legal digitalization

Published On : October 10, 2022

That today’s world is digitalized goes without saying. Digitalization creates new business  models. We can see the effects of digitalization right in front of our eyes. For instance, Uber  provides mobility services without actually owning cars, thereby displacing classical taxis.  Again, Airbnb offers private apartments for rent and thus creates competition for well established hotel chains. Therefore, industry leaders must ask themselves if their traditional value propositions are still  intact or if innovative players can use disruptive and networked technologies to gradually  push them out of the market.

This is also true for the legal industry which, for decades, appeared to be immune to all the  substantial changes caused by technology. While the core of legal services, i.e., the  assessment of facts in relation to the law, in most practice areas and cases is still too complex  to be executed by machines, this assessment of facts remains supported and surrounded by  many operational activities such as document analysis, contracting, and project management  for which clients today are no longer willing to pay high hourly lawyer rates. The deconstruction of legal work due to automation / software, has led to the standardization of high-volume and low-value tasks and led to the emergence of legal process outsourcers  (LPO). In essence, corporate legal services today are in a situation that looks quite similar to the one corporate information technology, financial and human resource services were in,  around 30 years ago – Chief Financial Officers (CFO) now also expect in-house legal  departments and law firms to use technology to deliver legal services better, faster, and at  lower costs.  

But corporate legal departments often don’t know where to start with legal digital  transformation. Often, they are left asking themselves questions such as: 

▪ What differentiates legal technology projects from classic IT projects? ▪ Are legal departments per se, a special / different audience?
▪ Do legal departments have the necessary funding?
▪ Can legal departments work / carry out their activities in isolation? This article offers an overview of the basic steps to take in your legal technology journey.

STEPS FOR LEGAL TECHNOLOGY SUCCESS

Research thoroughly and identify pain points

Don’t get dazzled by all the exciting legal technology on the market. It’s very important to  detail the pain points first so you can work out what the solution is. As an example, the usual  legal department pain points are high volume of trivial (legal) work, insufficient reporting  capabilities, cumbersome admin tasks, and high external legal spend.

Plan the budget for implementing automation

Work out the potential of the legal digital transformation project and then create a business  case for implementing automation in your legal department. All costs identified at this stage  will mostly be just basic estimates, but you can make estimates as well as assumptions about  benefits to calculate the potential ROI.

Initiate the project for digitalizing your legal department

Develop a detailed project and resource plan, assign team members, and set well-defined  roles for them.

Consider the available automation solutions

Define your requirements and evaluate build vs. buy (vs. do nothing) options. It’s at this stage  (when you have clear and specific requirements) that you should contact legal technology  vendors. Ensure that you include potential future users at some point during solution review.  This ensures the actual users have demoed the product and their opinions have been  considered. This will help with adoption of the legal technology after implementation.

Go Live!  

Procure, install, and test the solution. Consider on-boarding users in stages. Embrace failures  and adjust accordingly for a successful full implementation. 

The above steps are generally considered the five essential stages of how to approach a legal  digital transformation project.