When we look back on the current coronavirus pandemic, we will see it as a major turning point in history. The scale of this crisis will dramatically reshape society and the entire global economy forever, for better and for worse.
Our main focus should be on ensuring that the better outweighs the worse, for moments of crisis can also present opportunities: to rebuild, to innovate, to reform.
The crisis is already accelerating the pace of change in the workplace. The sudden need to work remotely has fundamentally altered most of our working processes. The shift to cloud-computing business models, and the adoption of platforms that increase productivity and efficiencies, will likely prove to be permanent moves for many businesses, rather than temporary stopgap measures.
Now like never before tech, data science and AI are combining to provide the fuel for ever more streamlined services that deliver efficiency, consistency and reliability for clients. Alongside new predictive tools that use data to anticipate what clients need and when they need it, these services are becoming the standard in many industries.
But for years law has been lagging behind other industries – banking, travel, retail – that have been transforming for the better through tech. It’s now time for law to follow suit and embrace change. Under the current circumstances, digital transformation must come as a matter of urgency.
Law is now ripe for change and, following the boom in ‘Challenger Banks’ and FinTech, I firmly believe that ‘Challenger LawTech’ is the next big thing.
Companies such as Starling, Airbnb, or Uber that did not even exist a dozen years ago, are now cemented into everyday life – focused on first class service for the individual, the small business rather than giant corporations . Architectured for the cloud, designed for mobile, these high velocity businesses are tapping into the ubiquitous delivery of services on a ‘just for need’ basis, with no geographical boundaries. They are delivering a service that is high on quality and low on cost.
The widespread perception of traditional law firms is that they are slow, expensive and they overcomplicate things for SMEs, as a recent YouGov survey has shown. 70% say that legal documentation is not easy to understand, while only 8% say that legal fees are good value for money. Only 1 in 5 SMEs rate law firms as ‘good’ in terms of ease of access (how easy it is to contact a lawyer; how speedy their response is and how easy it is to get a situation alleviated). This is not to say that all law firms are like that – far from it, but this perception is their reality.
The demand for law from business is substantial. In the UK alone, SMEs make up the vast, vast majority of businesses and spend upwards of £9 billion each year on law advice. Therefore, any service that delights frustrated clients with easier access to clearer and more affordable services, are well positioned to capture a large share of that market. We have seen this happen before in many other sectors and there is no reason these principles do not hold true to law.
The advance of technology has allowed SMEs to download simple legal documents online or connect individual clients with individual lawyers . While this does validate law-tech to some degree, these solutions fall way short in terms of platform scalability and the agility needed to serve the wide variety of SME needs. A bottom up law-tech approach that democratises the law, will empower SMEs to access clear and affordable expert legal advice from any device. This is demonstratively more valuable, both in terms of impact and addressable market.
Well-designed LawTech holds the key to delivering the consistently high level of service demanded from consumers, even business. When built correctly with cloud-computing and employing data science to deliver personalised services, these platforms have the agility to scale seamlessly across international boundaries. This increases the addressable SME market by a factor of 30.
The crucial question now facing Law Firms is whether they can adapt for the better. Whether they can streamline their operations and collaborate with other service providers to deliver combined solutions. Law firms with the right technology and application of data science are more likely to have the agility to fuel cross-fertilisation across different sectors in a fluid and intuitive way. Through partnerships with insurers, financial service providers and banks, law firms have a real opportunity to deliver the level of service that business customers now demand.
Old Law firm legacy systems will no longer be deemed fit for purpose. But for those with the right business model, service platform and value proposition for SME law, the prize is rising from the aftermath of Covid-19 on the right trajectory. Frictionless scalability to capture more market share and a laser focus on the needs of business is what investors will seek out. Whether law firms will rise to the challenge and seize this opportunity with both hands remains to be seen.