Last month I shared some of the key results about from a recent survey of the legal profession, the 2021 Wolters Kluwer Future Ready Lawyer Survey: Moving Beyond the Pandemic. This annual survey provides data, analysis, and insight on legal trends, with the 2021 Report including data obtained from 700 legal professionals across nine European countries and the U.S. from a broad range of law firms and legal departments. This year’s survey provides a wealth of statistics about law firms, the effects of the pandemic, and legal technology purchasing decisions.
Last month I focused on statistics relating to how lawyers planned to invest technology spend moving forward. In today’s post I’ll share survey results that show why and how law firms are prioritizing technology investments now that the pandemic is receding. Certainly every law firm’s needs are different, but understanding how and why other firms plan to invest in new technologies can be instructive and provide ideas for your firm’s post-pandemic technology roadmap.
One of the key findings from this year’s survey was that law firms are in the midst of unprecedented – and oftentimes unexpected – change. The pandemic had the effect of rapidly accelerating technology adoption, and in its wake came changed perceptions about client service and value:
“Law firms, already on the cusp of transformation prior to the pandemic, are now reporting accelerated changes across their firms as they move forward. They are working to provide the highest value to clients, as they also counter competition from other law firms, increasing client insourcing and the continued inroads by ALSPs and others.”
Notably, survey respondents shared that their firms are keenly focused on meeting the needs of their clients, and that technology investment is central to achieving that goal. Here’s how the authors of the Report characterized that data point:
“As firms focus on the increasing expectations of their clients, they are accelerating initiatives to
improve efficiency, productivity and client services. Most notably, 74% report they are Investing in New Technology to Support Firm Operations and Client Work (up 7 points from 2020); 42% are Creating Dedicated Innovation Function/Focus (up 8 points); and 42% are Formalizing Client Feedback Approach (up 3 points).”
Given the emphasis on meeting changing client expectations, it should come as no surprise that law firms are taking steps to implement processes and technology in order to better serve clients. Accordingly, the survey results showed that the areas that firms most anticipate they will need to change in order to deliver the legal services that legal clients now expect include:
- Greater Specialization of Legal Services Offered by Firms (82%)
- Greater Use of Technology to Improve Productivity (81%)
- Increased Emphasis on Innovation (78%)
- Greater Collaboration and Transparency Between Firms and Clients (78%)
- Greater Use of Alternative Fee Arrangements (72%)
Roadblocks to change
Of course, it’s one thing to make plans to implement change; it’s quite another to execute on those plans. Doing so requires buy-in from key stakeholders, including law firm leaders and key law firm employees, including paralegals and secretaries.
According to the survey respondents, getting everyone on board can be a significant barrier to change, as explained by the authors of the Report: “Organizational issues continue as the leading reason new technology is resisted in law firms; Financial issues drop as a reason from 26% in 2020 to 18% in 2021.” In addition to “organizational issues” and “financial issues,” the survey results showed that the other key roadblock to change was “lack of technology understanding or skills.”
47% of those surveyed shared that “organizational issues” were the top barrier to internal change. The top organizational issues encountered that prevented change adoption were: 1) lack of an overall technology strategy, 2) a culture that fears change, 3) lack of change management processes, 4) difficult to change workflows, and 5)
leadership resistance to change. Despite those challenges, significant changes occurred in 2020 during the pandemic, compared to prior years. As a result the authors concluded that “(i)n all areas, law firms made progress over 2020, with the largest gain in Effectively Implementing Change Management Processes (up 8 points from 22%).”
The second most significant barrier to change reported by the survey respondents was “Lack of Technology Strategy and Client Focus” according to 35% of those surveyed. Factors that fall under that category are: 1) lack of IT staff/skills, 2) lack of understanding of what technology is available, and 3) lack of training. According to the survey results, the greatest amount of change in 2020 occurred when it came to client service: “In almost all areas, firms improved over 2020 with the biggest gain in Keeping Pace with Changing Needs of Clients (up 9 points from 25%).”
Finally, the last area that survey respondents reported was a significant roadblock to change was “Financial Issues.” 18% of respondents identified finances as a barrier to change, which included the overall cost of change implementation and the inability to show that the changes adopted would provide a return on the monetary investment.
Technology: a top investment in change
Despite the perceived difficulties, law firms are making significant investments in change, especially when it comes to technology. According to the Report, 63% of those surveyed shared that their law firms had plans to increase their technology investment over the next three years. The top technologies that at least 75% of law firms expect to purchase over the next three years include:
- Automation of Document and Contract Creation Collaboration
- Tools for Document and Contract Drafting/Reviewing
- Document and Contract Workflow Management
- Cloud-based Services.
What investments will your law firm be making in order to meet client expectations? If your firm is ready for change, but you’re not sure where to start, then you’re in luck! Download this FREE guide for lots of great advice on ensuring that you make the right choices when you implement change in your firm: “Choosing the Right Technology for Your Law Firm.”
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