Law firms embrace the digital age

20 Jul Law firms embrace the digital age

As the digital revolution changes the world, the business of law is transforming its internal mechanisms to meet the new normal

The world of law has long lauded digitization as the way of the future. The recent COVID-19 pandemic saw an unprecedented sweep of digital movement in every industry on the planet due to a forced reliance on non-traditional means to keep economies functioning. A recent study by McKinsey concluded that the crisis accelerated digitization of products and services by seven years in Europe and by more than 10 years in the Asia-Pacific region. However, compared to many industries legal firms have shuffled their feet in moving towards paperless transactions, adopting IT technologies and implementing robust cybersecurity measures to protect internal and client data. Without doubling down on its digital transition, law firms stand to lose.

The scope of new technologies that can be applied in the law sector are many. During the pandemic, the lawyer-client relationship switched to a digital format, with more people being comfortable getting legal advice in a virtual room and performing online transactions. Digital technologies have also successfully pushed forward efficiencies in due diligence, contract review and legal research through predictive technologies and document automation. Electronic case management has meant having larger data sets and faster sifting times. However, most law firms have not pushed automation as far as it can go in handling complex processes such as new client onboarding and streamlining full involvement of all parties under a single due diligence workflow.

One of the most significant hurdles facing the legal sector is cybersecurity. The American Bar Association performed a study in 2019 that showed slow movement towards implementing measures to protect privileged data, but far under what is seen as necessary to protect from future threats. Less than 50 percent of law firms in the study used security tools, such as file, email or full-disk encryptions, and less than 30 percent used intrusion prevention and detection tools. Given that the ethical and financial ramifications of exposed information in the legal world are dire, a surge in investment in cybersecurity in law firms is expected in the short term.

Today’s law practice is set for a massive change. Predictive models have suggested a restructuring in the modalities of delivering legal services, such as the outright replacement of lawyers with artificial intelligence in mundane cases or a move to have lawyers become more transaction engineers than independent advocates. These projections along with new disruptive technologies have phenomenal implications on the world of law, and legal firms need to get ahead of the game or be left behind.