In the last couple of decades, there have been almost endless calls for the legal profession to embrace innovation and introduce more tech-led services on behalf of their clients.

We’re gradually seeing change and progression in this respect, with a raft of legal tech solutions now being introduced across the board and in an array of different applications.

But what do we mean by legal technology and innovation, and why is this important in a competitive and fast-paced industry?

What is Legal Technology and What Does it Look Like?

In simple terms, legal technology refers to the use of software and cutting-edge innovations (like blockchain and artificial intelligence) to replicate and deliver services directly to clients.

Such technologies present an opportunity for reputable firms to enhance their efficiency and create more agile working methodologies, which can benefit clients and reduce operational costs over time.

Typically, legal tech solutions can take numerous forms, and we’ve outlined some of the most prominent below:

  • Enabler Technologies: These refer to some of the most basic technologies and solutions, which help firms to process data compliently while digitising such assets to make them more accessible in real-time.
  • Support Process Solutions: These solutions are typically synonymous with back-office processes, such as accounting, human resources, business development and individual case management. Interestingly, this includes paralegal tech, which manages the processing, storage and management of documents across the board.
  • Substantive Law Technology and Legal Solutions: While the first two legal solution manifestations are focused on administrative tasks and back-end processes, substantive law innovations refer to companies that offer more complex solutions and packages to their clients. This makes allowances for actual litigation and case analysis, which remain at the core of how legal firms make their money (even in the digital age).

Why is Legal Tech Important and How Does it Impact on the Industry?

Legal tech and digital solutions play an increasingly important role in the law industry, despite the reluctance of some firms to adapt and integrate technology-led processes.

But why exactly is legal technology so important in the digital age? Here are some considerations to keep in mind:

  • #1. Cost and Value: Given the cost of delivering a quality legal service, it’s natural that law firms should want to optimise profit and prioritise value from the perspective of clients. Tech solutions can help in this regard and help to drive cost-efficiency across the board.
  • #2. Forced Innovation: It’s clear that the legal profession has been slow to innovate, but this change has been gradually forced over time. Most importantly, innovation has created a number of advanced legal technologies that have commoditised numerous law solutions.
  • #3. Scrutiny by Regulators: Regulators in various jurisdictions have become increasingly aggressive when reviewing and investigating legal practices, utilising technology and advanced solutions to ensure that firms aren’t used as conduits by criminal enterprises.

Ultimately, the rapid advancement of legal tech solutions has continued to improve the profession for the better, particularly in terms of transparency and making services available at more affordable prices.

This will also translate into an improved reputation for the industry as a whole, which is why a recent PwC report showed that enhancing and accelerating the use of technology remained the top priority for 94% of law firm respondents.