6 Trends Shaping the Legal Industry

by Natasha Bahari

Technology is at the forefront of a changing legal industry. Tech developments have affected the way firms approach delivering legal services, and have also impacted the way individual lawyers work.

According to the InsideLegal Technology Purchasing Survey, conducted in 2016, law firms reportedly spend between 1 to 6% of total revenue on technology. From automation to flexible working arrangements, this article sets out six trends that are currently influencing firms, lawyers and clients alike.

1. Process Automation

Although legal practice involves a high level of human engagement that cannot be easily replaced by artificial intelligence, automation can increase efficiency in many instances. Used the right way, automation frees up lawyers to spend less time on repetitive tasks and more time on customer service and strengthening client relationships.

Accordingly, some law firms have moved towards investing in technology that can automate document drafting and review, track cases, monitor compliance and aid in e-discovery. Automating these processes makes handling cases more efficient and translates into cost savings for law firms and clients. 2. Flexible Working Arrangements

Automating and digitising legal services delivery has led to an increase in the number of virtual law firms.  Clients can be located in a different geographical area from the law firm, with services delivered over the phone or via email, or video messaging apps like Skype. Lawyers don’t need to be tied to a desk in the law firm’s office; they can work remotely and flexibly. And not only does this allow lawyers to work how they want, but it makes legal services more accessible to those living in regional or remote communities.

3. Alternative Legal Service Providers

Lawyers no longer have a monopoly over the legal services industry. With the emergence of alternative legal service providers, clients now seek legal advice from a wide range of other professionals like:

  • paralegal technicians;
  • legal document preparers;
  • offshore legal vendors;
  • virtual assistants; and
  • self-help sites.

The emergence of these new solutions have made legal services more affordable and accessible.

Many legal service providers also focus on client education, publishing free materials online to improve education and transparency. The emphasis is instead on selling a great client experience and legal expertise, rather than simply knowledge.

4. Niche Practices and Specialisation

As a response to the rising number of alternative legal service providers and law graduates each year, lawyers also tend to specialise in a niche area. They analyse gaps that are present in the market and try to align their expertise or area of interest accordingly. Doing so means they can establish market share and remain competitive.

5. Alternative Billing Models

With competition from alternative legal service providers, and clients becoming increasingly well-researched and well-informed, lawyers and traditional law firms are looking at alternative billing models. These include:

  • retainers;
  • capped fees;
  • fixed fees; and

Clients want to be certain that their legal experience will provide them with value and they would like predictability of costs.

However, for more complex work that cannot be billed using a fixed fee or similar model, lawyers are using a combination of billing methods.

6. Business Development Skills

Clients know that many current legal matters, such as those involving intellectual property and information technology, require a specialist lawyer. However, clients are seeking lawyers who know not only their area of expertise, but also how to provide great service. Therefore, it’s increasingly important for lawyers to strengthen both their legal and customer service skills. This includes being familiar with:

  • marketing (including personal branding);
  • data analysis; and
  • technology implementations that will ensure a firm has a point of difference and a competitive edge.

With clients having access to an increasing variety of legal solutions, law firms are faced with a choice: remain competitive or risk falling behind. Law firms are responding to the challenge by:

  • specialising in a niche area;
  • offering alternative fee structures;
  • placing emphasis on the end-to-end client experience, beyond simply doing the legal work.

It’s a time of change for the legal industry, but law firms who continue to improve their understanding of clients and provide a holistic legal service will rise to the top.



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