Small firms are 'go'

There is a lot of noise surrounding the emergence of intelligent software on the legal scene. At times, the impression is of a profession collectively undergoing a radical transformation, with quills and seals replaced with clouds and chatbots. The reality is that most of this is vendor driven, with regular announcements that one or other of the few pioneers in the field are signing up a new ‘major’ client.

None of that is necessarily bad or wrong. Technology undoubtedly has the potential to change delivery models for the better and to make legal advice accessible to more people. And, for sure, it could be big. But for most law firms right now the robot-assisted dream looks more Thunderbirds than SpaceX.

Experimentation with artificial intelligence, natural language processing, and machine learning is still mostly the preserve of City firms or Big Law escapees setting up niche New Law practices. The appetite for technology is clearly percolating into the Top 200 tier, where firms, such as Hodge Jones and Allen or Wright Hassall have dedicated legal innovation teams. Beyond that, the picture is more fragmented.

To date, just under 20 per cent of large firms have already replaced work previously undertaken by paralegals with automated processes. For medium-sized firms that number drops to 5 per cent, and for small firms, to 2 per cent, according to the Law Society’s ‘Capturing Technological Innovation in Legal Services’ report.

Chancery Lane’s latest research doesn’t contain any ground-breaking revelation. It usefully pulls together earlier findings but only provides a few practical pointers about how smaller firms could get aboard the technological innovation train. So, behind the top-line figures, one aspect remains unclear: are small firms really lagging that far behind?

Most of the headline legal tech talk has focused on improving, and reducing the cost of, processes. Contract review has been a prime example, especially in M&As, with their large volume of documents and information that underpin deals. The products on offer have been developed in response to Big Law requirements and what they do certainly sounds impressive. SME firms don’t get involved in this kind of work, but it doesn’t mean they’re being left behind.

It is probably true that in most smaller firms day-to-day priorities leave little time to look beyond the current work-in-progress schedule. Legal tech specialists say firms need to find space to develop new ideas. By virtue of their size, few small practices positively do so.

One the other hand, they have one major advantage over their larger brethren. Their scale doesn’t give them the same leverage but it means they are much more nimble. They may not have dedicated technology teams but, more and more, one geeky partner will suggest tech improvements and take responsibility for implementing new ideas. Decisions can be made quickly and implemented rapidly.

Quietly, a lot of these firms are already moving across to efficient technology-driven processes. They’re capturing client information via online forms, using document-assembly software to prepare wills or contracts, or deploying case tracker modules. This may not sound as radical as machine learning or predicting the outcome of litigation, but it addresses their needs at their level.

Should we therefore ignore what’s going on at the more sophisticated end of the legal tech spectrum? Of course not, especially as prices will come down and more of it will be available to smaller firms. But the point of technological innovation is not how complicated or expensive it is. Technology is exciting and it can change the way legal services are delivered, but it’s only a means to an end.

Jean-Yves Gilg is editor in chief at Solicitors Journal

jean-yves.gilg@solicitorsjournal.co.uk | @jeanyvesgilg