Technology and Its Irrevocable Place in the Law

The famous axiom, “Nothing endures but change,” is often credited to the ancient Greek philosopher Heraclitus.[1] His words contain a truth that has found its place in the course of history – the evidence is pervasive in all of humanities endeavors – look at the Internet, social media, and mobile computing. The legal industry, antiquated in many ways, is not exempt from Heraclitus’ words.

Recently, the legal industry has been under fire for its lack of innovation and essential embrace of new technologies – both of which could bring lower costs to clients and increased efficiency in law firm operations. The Great Recession of 2008 inculcated a permanent wakeup call in the legal profession, forcing law firms to trim the fat of non-necessary costs in their practices. A beneficial result of increased efficiency is the ability to provide legal services at a lower operating margin, ultimately boosting the net profit for law firms.

ReInvent Law, a technology conference that took place on February 7, 2014 in New York City, exemplifies a recognition and response to the changes taking place in the legal industry. The conference called for the integration of technology in the practice of law – a change that must occur in the new world of tech, if law firms are to remain competitive now and into the future. The ABA Journal, Michigan State University College of Law and the Kauffman Foundation sponsored the event that more than 800 lawyers, academics, business owners, students, and others in the legal industry attended. Some of the key topics discussed at the event included price transparency and data analytics, as well as emerging technologies like Google Glass and computable contracts. [2]

Another hot topic at the conference was a calling for lawyers to change from the traditional billable hours model. Mark Chandler, the general counsel of Cisco, discussed the changes his company was forced to make in the wake of the Great Recession of 2008. His company chose to automate as much work as possible as a way of saving costs. His statements recognized the fact that law firms are often reluctant to change their habits, once they become established and comfortable. [3]

Still, technology has empowered other industries and the ReInvent Law conference touted that technology was a saving grace for today’s practitioners. For example, the evolution in document review provided a showcase example of how time and money may be saved with new software. Predictive coding is becoming more accurate and efficient at finding relevant information in documents – eliminating the need for hiring a costly team to pore over endless documents. The increased savings that attorneys can save by implementing technology in their practice could even be passed along to clients, who are also looking to save a couple bucks due to the recession.

One important message to take away from ReInvent Law is this: while technology is predominantly a positive element for lawyers and their practice, paradoxically, it may also hurt them if clients can turn to the internet for similar services at a lower price point. This reality is leading to the stratification of rates lawyers charge clients for services. Factors affecting the costs may include the complexity and time-frame of the project demanded.[4] Lawyers must now compete at lower rates if they are to survive into the 21st century. These new challenges must be given full consideration and managed accordingly.

Based on the plethora of information one can find with a simple Google search for “technology and changes in the legal industry,” no doubt exists that a storm is brewing as to the future of the profession. The challenge for lawyers is two-fold: they must not only be proficient in a legal subject matter, but also in the procurement of maintaining a successful business. Technology is certainly not going away any time soon. Conferences such as ReInvent Law are a signal that changes are on the horizon, and those who adapt most successfully will obtain a gainful share of the market. How is your law firm embracing this evolution?

__________________________________________

[1] Quotes about history, Ferenc M. Szasz', accessed 3/26/2014 at 6:47 P.M.; http://rbedrosian.com/NFactors/szasz_history_quotations.pdf.

[2] ReInvent Law NYC implores lawyers to embrace change and technology, Posted Feb 9, 2014 10:06 PM CDTBy Victor Li, accessed 3/26/2014 at 7:3 P.M.,http://www.abajournal.com/news/article/reinvent_law_nyc_implores_lawyers_to_embrace_change_and_technology.

[3] Id. [4] How Entrepreneurship Is Reshaping The Legal Industry, 7/24/2013, Cari Sommer, Accessed 3/26/2014 at 8:25 P.M.,http://www.forbes.com/sites/carisommer/2013/07/24/how-entrepreneurship-is-reshaping-the-legal-industry/