As I write, practically every law firm leader will likely have set out their strategy to fully embrace the potential of legal innovation and technology in 2022 and onwards. It has been perceived as the holy grail that will deliver cost reductions, service enhancements and overall a glorious future of profitability and legal excellence for firms and their clients.
And most leaders will privately be just as energetically wrestling with the lack of progress in achieving those lofty goals or measurable financial return. It’s Hofstadter’s Law: any innovation project takes double the time anticipated – even when you take into account Hofstadter’s Law.
What’s the holdup? What is lacking may be neither skill nor will nor capital, but practical barriers combined with a lack of understanding around the fundamental mechanics of technology and innovation investment.
Technology should not be deployed as a one-off – it works by investing a lot of effort once, to reduce the costs of reproducing an outcome an infinite number of times. You may initially invest 10,000 times the cost of producing a widget manually into an automation solution, after which point the tool may deliver an individual widget at half the cost of doing so manually – so it would take the production of 20,000 widgets before the cost of automation investment is repaid.
“What’s the [innovation] holdup? What is lacking may be neither skill nor will nor capital, but practical barriers combined with a lack of understanding around the fundamental mechanics of technology and innovation investment.”
When we automate legal services, we create technology solutions to replace manual tasks. This requires identifying an appropriate technology platform, procuring and installing it, then extracting experience and knowledge, translating it into a process and decision rules, followed by numerous cycles of configuration and testing. When factoring in the efforts of everyone involved across a firm, the investment required to execute such a tech project multiplies and quickly approaches hundreds, if not thousands. That’s excluding the effect of conflicting requirements, distraction by urgent matters, overengineering the solution or design by committee.
What can you do about this as an operational leader? Three things come to mind:
Innovation is often the function with the greatest amount of work in progress (WIP). Every partner wants to innovate and improve their service (as they have been told to do), so you cannot say no to their requests for help. But any idea your team has started to pursue and has not brought to market is WIP – effort spent without return.
Only deploy legal technology in product areas that are large enough to make it worthwhile and where partners and clients will accept some homogeneity. Remember, you need to sell 20,000 widgets! Single partner practices are rarely sensible areas of investment for automation. In the marketplace for legal tech, you will readily find existing solutions for activities done at scale.
Frustratingly, the process of implementing technology and process improvement itself is often a highly manual one. Can you automate the automation? It pays quick dividends to put in place some standard workflow and automation platforms (HighQ, Bryter) that can do many things decently, if none perfectly, and require less coding. This will improve deployment cost and speed substantially, accelerating payback by at least 12 months.
If you can get all three right – focusing on services at scale with standardised tools – delivering legal innovation is no longer difficult. You can deliver on those lofty ambitions, and relieve the frustrations of your managing partner – who knows, you might even overcome Hofstadter’s Law.