Technological advancement and innovation have been two of the most crucial trends driving change in the legal sector recently – they are key for law firms intent on growing, staying relevant and remaining competitive in an evolving industry.
So who are the innovators? And what do they do differently? We look at some of Australia’s most innovative practices and uncover what happens when law firms embrace change.
Who are the legal innovators?
In Australia, the 2016 Legal Innovation Index – which recognises and rewards firms and individuals who demonstrate innovation in the legal industry – saw a 100 per cent increase in entries. The winners:
- Corrs Chambers Westgarth
- Gilbert + Tobin
- Herbert Smith Freehills
- Pinsent Masons
- Royal Automobile Club of Queensland (in-house legal team)
So what do innovative law firms do differently?
1. They foster a firm-wide culture of innovation
Ideas and change don’t necessarily come from the top, or even a single source. A firm-wide focus on continuous improvement is essential – especially in an industry that is traditionally risk averse – as the digital revolution creeps into all parts of how we work. Law firms must ask: how can lawyers embrace and benefit from inevitable technological change if they don’t fully understand it?
Gilbert + Tobin has answered that question by not only teaching its lawyers about technological advances, but making them part of those changes. The firm created a development program to teach its lawyers and clients to code, with 60 of its lawyers learning the basics of computer coding.
Another culture-building strategy is to remove organisational silos separating professional and technical staff. Dedicated ‘innovation groups’ can also encourage the internal collaboration that feeds a culture of innovation.
Allens’ in-house multidisciplinary group A-Plus – comprising a team of technologists, consultants, pricing experts and other professionals working alongside the firm’s lawyers to drive innovation – is an example of a firm rethinking how things are done and identifying opportunities for change.
2. They embrace the game changers
Much of the talk around innovation in the legal industry focuses on the NewLaw model of business. This leaner and more agile version of legal services, which is experiencing significant growth, seems at first glance to be the opposite of everything BigLaw represents.
However, some of the industry’s biggest hitters are collaborating with or adapting ideas from NewLaw firms. Highlighted in the 2016 Australia: State of the Legal Market report by Melbourne Law School and Thomson Reuters Peer Monitor®, these BigLaw collaborators include:
- Gilbert + Tobin making an equity investment in LegalVision, a web-based legal document and advisory business.
- Norton Rose Fulbright and LawPath joining forces to offer four standard fixed-price services, sold and delivered online.
- DLA Piper partnering with Lawyers On Demand to help develop DLA’s freelance lawyer platform.
Allens has also set up Allens Accelerate, a niche legal practice “dedicated to supporting the Australian startup community” that provides “expert legal advice to startups, investors, and corporates and government agencies responding to disruption and investing in innovation”.
3. They step into their clients’ shoes
Innovative law firms invest in a client-centric approach and always remember why they’re in business: to help their clients.
Niche law firms that home in on their target market’s problems, use social media to cultivate new business relationships, collaborate with clients and generally speak their clients’ language are thriving.
But it’s not only specialist law firms doing this well. Herbert Smith Freehills’ Re-Imagine Legal framework, which takes a top-level approach and questions how legal services delivery might be re-imagined, is reported to have led to “significant cost-savings through greatly enhanced innovation and productivity for their legal team”. The firm collaborated with Telstra, a longstanding client, to deliver legal services in ways that align with its clients’ business strategies and goals.
4. They adopt technological advancements
Instead of being afraid of – or ignoring – the increasing pace of technology, innovative firms adopt it to increase their legal know-how, the efficiency and quality of their services, and to make their employees more productive and happy.
Corrs Chambers Westgarth designed a ‘workplace of the future’ for its Perth office – the latest in a series of office shifts to fully embrace an open and flexible office environment since 2013 – after the firm took its first steps towards a more innovative way of working in its Sydney office.
It also developed Corrs Collaborate, a cloud-based platform providing workflow, calendaring and blogging capabilities for clients to “manage their own internal business processes and the legal services that might be part of that”.
Allens has a dedicated LawLab, comprising a “cross-functional group of information and legal technology experts” who “continually test what is in the market, embrace cutting-edge technology and work with technology providers to refine their application”.
Allens is also a keen user of document and contract automation software. Speaking with Thomson Reuters, Justine Woodford, head of knowledge at Allens, says: “[The needs of clients are] prioritised above all else at Allens, and are one of the primary drivers for every innovation introduced [within the firm]. Clients look to us for clever solutions to structure their businesses in more efficient and innovative ways.”
However, it’s also important to keep business basics in mind when investigating new technologies. “While there are many things to get excited about in relation to technology, there are still a number of important considerations for choosing one technology solution over another,” Woodford says. “[It’s] ultimately a question of what technology offers the best business benefit and will be embraced by those in the firm who need to use it.”
Innovation is essential for the future of legal practice
A common thread among firms using change to their advantage is a commitment of both time and resources, as well as an openness to new and original ways of doing things – that’s the very nature of innovation. It’s necessary for the legal industry to move forward, and non-negotiable for firms in the future.
In a special report by The Australian, Paul Jenkins, managing partner of Ashurst, spoke about the cultural upheaval innovation has brought, saying it enabled firms to adapt and introduce practices that other professional services markets had already adopted successfully.
“It’s not about law firms choosing to innovate, it’s about being required to innovate by sophisticated clients,” says Jenkins.
“Putting it simply, there had to be cultural change in law firms in all the sophisticated legal markets across the globe in order for the industry to improve their level of interaction and service. There had to be cultural change in the way people think about legal services and the delivery of legal services.”
It’s anyone’s guess how continued change will shape the legal industry in time to come. But ultimately, firms that want to stay ahead of the curve in the current disrupted legal industry need to be willing to adjust their mindset according to change, break away from limitations often synonymous with the traditional practice of law, and find a way to continually deliver value to clients.