Why should law firms invest in Legal Tech?
Updated: Jul 21, 2021
Introduction to Legal Technology
Technology is not new to the Legal industry. Law firms have been using technology for documentation for over a decade now. However, with the global pandemic, it has become more prevalent. Legal technology, also called LawTech and LegalTech, refers to using software and technology to accomplish legal services. Traditionally, technology was used by individual lawyers, mid-size law firms, and large-scale businesses for documentation and emailing only. Nowadays, Legal Tech integrates document storage and legal databases with artificial intelligence, cloud computing, and machine learning to assist lawyers with documentation, management, storage, automation, E-signature, and analytics. Lawyers around the globe are adopting the new technology because Legal Tech has proven to be time-efficient with a negligible amount of errors. It is estimated by McKinsey Global Institute that 23% of work accomplished by lawyers can be automated by existing technology. Legal Tech is no longer an alternative, it is here to stay and expand with time.
Key benefits of Legal Technology for organizations
Here are the most significant benefits an innovation is bringing to traditional law firms and companies worldwide.
Most of the tasks in a legal organization are performed manually. And often, the work is repetitive and tedious. With the use of correct software, these manual or routine tasks can be automated. Legal automation can help lawyers focus on high-priority tasks by taking care of low-value process work. Automation in the legal industry can be used in document reviews, contract automation, bill management, risk management, and automated workflows. Automation with cloud computing and AI will ease the burden of lawyers.
2. Improved research:
Staying up-to-date with the latest trends and progresses of the legal world is very important. Traditionally legal experts used to rely on printed documents as a reference tool. Legal Technology now uses cloud computing to show real-time data without the fuss of documentation. Research tools customized for law firms can ease the time-consuming process and store critical research data.
3. Fewer risks:
Employee negligence, misinterpretation of facts, and misjudgments can be minimized by adapting Legal Technology. Self-aware technology capable of analyzing the situation from different angles is used to reduce the risk of financial and reputation damage is an emerging trend. Through machine-learning-based tools, technology helps human experts make the right decisions with utmost precision.
4. Optimised Resource Management:
The monotonous and low process work can take up crucial time for law firm employees. And mostly the paperwork and other routine tasks are given to junior lawyers. With the help of Legal technology, every employee in the organization can work efficiently on essential tasks. Technology management and automation can handle routine tasks, letting the junior lawyers focus on learning the craft faster and contribute more to the team in a shorter time.
There are many areas where transparency drives and protects businesses. Let's take an example of:
A new client- A new client is not sure of your legal organization. The first step of a client relationship is establishing trust and transparency. With technology management solutions, it is possible to create an overview procedure transparent for both lawyers and clients. This helps establish a trustworthy relationship faster.
Contract renewals- Technology can provide timely alerts of contract renewals and violations. This safeguards everyone from unnecessary fines, penalties, or fraud due to contract violations.
Legal playbook implementation- Manually implementing such a playbook is tedious, and it is time-consuming to see what might be missed out. And modern technology solves this problem with the click of a button. And it is the tedious job that just got solved forever - who doesn’t want that.
6. Better convenience for customers:
Mobile applications and software solutions have helped in creating customer-friendly tools for the entire world. Legal tech is no different. New-age legal tech tools are very convenient and effective in getting real-time updates for clients. Business and legal users are getting more and more hooked to the convenience of using legal tech.
E-signatures are one of the prime examples that provide utmost convenience in Legal tech. Legal teams don’t have to chase signatories with documents and printouts. Even external clients can approve contracts from anywhere using mobile devices within minutes of you sending the contract.
7. Technological edge over competitors:
Legal organizations have tough competition. While some follow the traditional path, those who are turning into innovative law firms are prospering more by getting more customers and reinforcing the trust of the existing ones. If you want to stay on top, it is now more than necessary to adapt legal technology.
The future of Legal Technology
At present, we have observed exponential growth of technology in all sectors. So far, legal technology has been utilized to support lawyers and law firms with routine tasks such as documentation, accounting, billing, contract reviews, e-signatures, contract renewals, and contract management.
In the future, we can imagine lawyers developing systems that will solve clients’ problems. Whom we refer to as lawyers today will be called legal knowledge engineers, legal risk managers, technology experts, system developers, and more.
In the coming decade, it is beneficial for legal teams to learn the essential skills and work alongside technology to be at the top of the trade.
The legal industry is still undergoing the digitization that other industries have already gone through. Many legal innovations are underway and legal tech will continue to boom in the coming months and years.
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