The holy grail of precedent automation

Automating the drafting process can improve firms' profitability, efficiency, and risk management, provided they don't underestimate the complexities involved, writes James Quinn

Automating the drafting process is a holy grail
for firms, bringing greater efficiencies to their practice while keeping their greatest expenses - salary and fixed earnings - under control. Precedent automation saves
fee earners time in producing
a first draft of all types of
legal documentation by automatically completing the routine, mechanical, and logical aspects of drafting.

However, firms have often come unstuck when undertaking these kinds of automation projects as they invariably underestimate the complexities involved. Perhaps unsurprisingly, the intricacy of the legal system together with the technical nature of precedents means that automation is far harder to achieve than many assume.

Success relies on managing people (both internally and externally), the automation process itself, and the technology. The effort required here is often significantly underestimated, particularly the demand on internal resources.

But times have changed
and innovative approaches
to precedent automation are
now helping firms meet the challenges of the post-2008
legal market.

Business benefit

Precedent automation ensures in-house expertise is captured, codified, and maintained in templates within the automation system, which
are retained by the firm.

Precedent-automation software abstracts users from the underlying precedent
suite by presenting them with
a questionnaire that collects relevant data and guides them through the document-creating process. Based on the answers to the questionnaire, the appropriate amendments are automatically inserted into the document, which is generated by the system and then returned to the user.

With the latest precedent-automation solutions and a fixed-fee arrangement, work that would once have taken up to five hours can now require as little as 45 minutes, improving margins in line with efficiency.

Simple tasks such as
changing the logos and styles across a merged organisation's documents usually take months to complete manually, but with precedent automation, the same task can be completed
in minutes.

The latest approach involves outsourcing projects as a fully managed service. Service providers should resource
the entire project, offering multiskilled teams that will
take responsibility for the automation and maintenance
of precedents, allowing firms
to gain all the benefits without the difficulties. This approach requires minimal involvement from both the in-house IT department and from fee earners and professional support lawyers, whose time can be used in a far more valuable way. With firms finding it harder
to maintain profitability levels as they lower fees and increase unrecoverable hours to remain competitive, the true business benefit of automation is derived from time saved from both a drafting and review perspective.

Automation allows fee earners to be deployed elsewhere and creates greater opportunity for delegation to junior, lower-cost fee earners. The improved efficiency allows a firm to increase its recovery rate and volume while maintaining, or even decreasing, its overheads.

Additionally, firms are
given greater control over
their precedents, ensuring consistency in drafting as well as better risk management
and built-in quality control, contributing to brand reputation and client satisfaction.

Practical steps

Automation projects are complex and require careful planning and resourcing in order to be successful, so my top tips are:

• Ensure at least one sponsor at partner level who has a vested interest in the success of the project and can help ensure the necessary internal focus;

• Use an intermediary who is legally trained with a deep understanding of document automation to help reduce the risks inherent in delegating automation to non-experts;

• Focus on solutions that are user friendly as fee earners will not embrace cumbersome technology or endure extensive training sessions;

• Purchase managed solutions designed by people who understand the legal framework and technological nuances of automation; and

• Take a comprehensive look at the total cost of ownership for the project and get a clear view from a risk perspective of how the project will actually achieve its goals for the business.

The move to precedent automation will represent uncharted territory for many, but firms that embrace it with the right mentality, approach, and technology will benefit from a distinct commercial and competitive advantage.

James Quinn is a solicitor and director of Clarilis www.clarilis.com