Everybody in the house? In-house counsel and future practice

Introduction

The covid-19 pandemic has highlighted gaps in the legal industry’s modernity and encouraged both in–house counsel (IHC) and firms to embrace flexibility and collaboration. Remote working practices look set to continue well into the future, having been vindicated both in terms of productivity, revenues and in the positive impact that it has had on the health and wellbeing of staff – but physical office life and face-to-face meetings also continue, and will always be a feature of working life. In this hybrid world, existing and new legal tech has a significant role to play in how IHC and firms maintain their relationships and how firms meet IHC’s legal needs.

The relationship between IHC and firms

The traditional approach of firms becoming embedded in their client’s business is more relevant today than it has ever been, such as secondments, joint ‘away days’, training, etc. The difference today is how this can be achieved when many firms haven’t been face-to-face with their clients for 20 months or more – or will be doing so in a hybrid way for a long time to come. Existing and innovative legal tech solutions have come to the fore to facilitate these traditional activities taking place in our new hybrid world.

The relationship side of things hinges on good communications and in a hybrid world of physical and virtual working. This means IHC and firms need to ensure their teams have access to appropriate hardware, connectivity, content, systems and training to ensure that they are able to fully participate in their physical and virtual relationships and activities. Those who are not providing the right communication tools and solutions will not get the best out of their teams – and may even lose their best people if they cannot communicate and have meaningful relationships with their team members and external IHC or firms. Firms and IHC should be collaborating on which solutions works best for their people and from a tech perspective and sharing best practices. For example, Browne Jacobson’s IT teams have gone in and worked with IHC clients to assist them develop their communication tools and other systems and provide training. We have also shared our own ‘war stories’ and flagged pitfalls for them to avoid.

Another approach that has worked for Browne Jacobson is for some of our sector teams to invite IHC to our strategy planning days, for them to ‘kick the tyres’ and give us an external independent view (like a NED would do) of what we are doing right (or wrong0 – and how we can tailor or focus on client solutions that will be more relevant and appealing to IHC in that sector. This has usually resulted in an invitation to Browne Jacobson to do the same for the IHC legal teams. This adds great strength to the relationship, and creates a strong sense of investment in each other’s organisations.

Legal Tech

IHC are increasingly looking to firms to offer value added innovative legal tech that will save them the costs of having to invest in expensive systems, products and licenses, and avoid the additional costs and risks of implementing, maintaining and operating those solutions – but they also want the legal tech to add efficiencies, consistency, scalability and accessibility – the latter being absolutely critical for hybrid working and remote access. Attracting IHC business is very competitive and the firms see that offering the right legal tech, transparency, accessibility and collaboration will give them a competitive advantage and also help to break down the overriding commercial drive of IHC to keep work in house. That said, it is not all about the ‘flashy’ or ‘disruptive’ legal tech. IHC want tech that makes a difference, and addresses their very practical needs and work.

In many other industries, customers get access to their data, information, and consumer details via a ‘client account’. Yet, in the legal industry this is not a standard offering to clients across firms. These client accounts could make transaction or case documentation available, contain deal rooms for drafting, amending or exchanging documentation, give access to the fees budget (and progress against it), billing information, team sheets, timetables, training materials, know-how – and not for just one matter, but for multiple. Costs and security issues are definite factors as to why firms have been slow to make client accounts widely available – but two bigger barriers are likely to be that (1) firms’ legacy systems and the data residing in them (or not in them, if in hard drives, e-mails or other communication tools), and the quality of that data, do not easily lend themselves to being transferred or displayed in the client accounts; and (2) curating and creating the content, and keeping the client accounts continually ‘fed’ with relevant and up to date information can be problematic for firms, especially if they are not charging for this, nor have dedicated resources to service the client accounts. IHC and firms should face up to those costs and have sensible conversations about them, as this is likely to lead to a better service.

Another area of legal tech in which IHC have a keen interest is the case management systems and project management systems used by their firms. These systems have often been developed over time and have become unwieldly – but of course, they are most appealing and effective for IHC if they align to their needs. Firms should be collaborating more with IHC (and their IT teams) to understand ‘what problem is it you are trying to solve’. If that is known, the firm can develop and offer more relevant case management and project management systems that will keep their ICH clients happy.

IHC with high volume work are looking for firms to offer legal tech that delivers lean processes, standardisation and processes that facilitate tight management of their transactions and caseloads. AI solutions can come to the fore in these areas, because the volume of business facilitates the usually high investment in AI solutions. Because of their ability to handle significant capacity, the bigger firms tend to act for IHC with the largest capacity or volume needs – and it is those firms that are at the forefront of the development of AI legal tech. What is often key in high volume work is for the firm to be able to offer some form of predictive analysis across the workload – or identify ranges of specific use cases and information from the unstructured data.  This means access to large pools of unstructured data is needed, which is vital and is this on which successful AI tools thrive.

What the mid- to small-sized firms are very good at is using bespoke solutions to solve their clients’ needs, e.g. deal rooms, document trackers, DocuSign and online portals. There has been an explosion of ‘low code’ or ‘no code’ technology that firms are using in collaboration with IHC. Apps that build other apps to perform certain functions required by a client are a common feature. High Q, another good example of this type of legal tech, is used by many firms and is also an agile tool. The investment in this tech is low – and the teams (i.e. the lawyers) in the firms usually develop it themselves with not too much input from their core IT teams – Gartner calls them ‘Citizen Developers’. Sometimes, the catch with the solutions produced by this legal tech is not costs or resourcing – but the internal ‘risk hurdle’ of approving those solutions for use with clients as firms operate in a regulated environment. Again, by its very nature, to get the best out of this tech, IHC should be working and collaborating closely with firms to let them know exactly what they want their legal tech to do.

One thing is clear – as IHCs’ requirements are continually evolving, and both IHCs and firms will need to work closer than ever before to get the best out of each other – and for both IHC and firm to keep innovating and challenging how legal advice is provided.

Anthony Nagle is a partner who leads the IT & sourcing and digital transformation eam and Andrew Woolsey is a trainee solicitor in commercial and IT law – both are with Browne Jacobson: brownejacobson.com