Legal Innovation

Corporate legal departments want to see law firms enhance their level of technological sophistication—but what does that mean, exactly? While arriving at an answer may require both outside and inside counsel to define more specific parameters around what they hope to gain out of technology, actually effecting change might hinge on larger cultural shifts still playing out within the legal market itself.

In the meantime, the most immediate takeaway could be that law firms are coming up short—and sometimes heading in the wrong direction altogether—with technology.

"It's no secret that law firms in general remain behind the curve when it comes to incorporating new technology into their services. Legal departments don't expect or want law firms to become technology providers. Instead, they want to see a willingness and drive for law firms to find, develop and incorporate new digital solutions, which improve cost and efficiency for their clients," said Catherine Moynihan, associate vice president of legal management services at the Association of Corporate Counsel, said via email.

But terms like "efficiency" can still leave plenty of room for interpretation, and it could be that sometimes even corporate legal departments are struggling to fill in the gaps. Tomu Johnson, a former in-house attorney and CEO of Parsons Behle & Latimer's tech subsidiary Parsons Behle Lab, believes that in-house attorneys may themselves lack the depth of technical expertise or understanding required to quantify their expectations to outside counsel.

"It's hard for in-house counsel to say what they want, they just know that what their attorneys are providing is not it," Johnson said.

Still, it's not that law firms aren't ignoring technology altogether. Firms like Mayer Brown, Wilson Sonsini Goodrich & Rosati and Dentons, for example, have all rolled out tech solutions geared towards helping clients stay up to date on regulatory developments around the COVID-19 pandemic. But while those kinds of applications may help bring clients through the door, they won't necessarily get them to stay.

Brett Burney of Burney Consultants said that he's seen a variety of law firm booths pop up at Corporate Legal Operations Consortium (CLOC) conferences over the last few years, usually emphasizing their use of technology. Blockchain-oriented projects seemed to be of high interest to larger firms in particular, who Burney noted invested capital in hiring analysts, programmers and other development talent.

"I know that law firms that law firms are doing a lot of these databases and developing apps and being a part of blockchain meetings and talking about AI, but I feel like that's just kind of more from a marketing perspective, to give a perception of what the reputation is, that they are on the cutting edge," Burney said.

But when it comes right down to it, law firms are still sitting across the table from corporate counsel expecting more access to pricing data, the use of less e-mail in favor of collaboration platforms like Slack and more efficient document storage. So why are some firms still falling behind?

The culprit could be a lack of meaningful incentive. For starters, law firms working off a billable hour model could be loath to implement solutions that can save time. The only leverage that the corporate client has is its business and changing outside counsel is often poses too big a hassle for too little return.

Johnson at Parsons Behle Lab believes that increased competition from within the legal market will eventually be what pushes firms to progress, especially as states like California and Utah allow tech-oriented businesses to take a bigger role in the legal process.

"Law firms have to adapt or die," Johnson said.