Does the legal tech world and the participants within it, from vendors, to law firms, to inhouse legal teams, to the justice system, share a common cause? Are all these players in the legal and legal tech (LLT) ecosystem working toward the same shared goal? The short answer is: no. The long answer is: yes, although many may not know it. Let me explain.
A Common Cause
During the last session of the Legal Innovators Online conference in May, there was a far-reaching discussion about where the LLT market was heading. One panellist, Jenifer Swallow, of TechNation and Director of the LawTech Delivery Panel, a UK government-backed initiative to transform the legal sector through tech, posed the question as to whether there was a shared purpose that market participants had in common; was there something that we were all working toward, or could work toward?
It is a great question and one I’ve often wondered about. And now, more than ever, with so much discussion of change, as well as real world change – at least among some quarters of the commercial legal market – it seems a good time to unpack this and explore.
So, first up, let’s consider the main market participants. Here’s a sample:
- Most legal tech vendors are private companies, with a handful of law firms now building and selling their own tech as well. Fundamentally they are there to make money, no matter what the underlying product is. They are also in competition with each other. Supporting certain causes (e.g. driving efficiency) may help boost that income as it drives a change in perceptions and triggers software purchases, but there isn’t necessarily a shared higher purpose there, (though there could be in other ways – see below).
- Many started with passionate founders hoping to find better ways of doing things in the legal world. In fact, the refrain of ‘….and I was sitting there at my desk at 11PM on a Friday at my law firm and realised there had to be a better way of doing X’ has sparked the creation of dozens of startups.
- But, many also are giant companies that have been here for decades and may have no interest at all in disrupting the status quo. Some certainly for a time saw the new wave of legal tech companies that surged into existence from around 2015 as a threat. They have developed new products – often that do what the startups do and sometimes by acquiring them – because the market is shifting, but they don’t always do it because they really want to change anything fundamental about the legal market, which has served them well and made their shareholders rich.
- And as startups grow into larger businesses they inevitably change focus. What started out as a revolutionary act to smash inefficiency ends up as a mission to grow a company, satisfy investors, and manage a growing workforce – while of course keeping clients happy. That’s not to say that the initial radical spark and intention is not there any longer, but it now competes with a dozen other pressing issues.
- Moreover, the idea that everyone in a legal tech company shares the same goals is also a hard idea to sustain. For example, a person at a tech company may simply want to: sell software, make money, build their career – which is a totally fine thing to want. Do they have a passion for changing the means of production in the legal market, do they want to disrupt how lawyers work? Possibly, but we can’t assume that because you work at X company then you’re committed to knocking over the status quo.
- The world of Legal Services Businesses (LSBs) i.e. law firms, ALSPs, LPOs, law companies, the Big Four, LOD companies, barristers chambers, consumer self-serve sites and more, is vast and complex and serves a wide range of buyers, from Fortune 500 companies that want to do an IPO, to refugees looking for help with settlement documentation. In most circumstances they are also private businesses, which fundamentally are there to make money. Many are in a state of fierce competition. Again, the idea of a common cause – beyond serving the clients – seems unlikely.
- And, on that point of serving the clients there is little common ground either. Some traditional firms, such as those stuck in the status quo, cling to the billable hour even though it arguably harms the clients, they see tech at best as a way of providing some small convenience to their lawyers rather than the clients, and have no interest at all in disrupting their service delivery model, i.e. leverage, leverage, leverage and bill that time! And, one could argue, fair enough, they are private businesses and can choose their business model. But, it underlines again how hard it is to have an explicit common cause here.
- Other LSBs are actively trying to disrupt the market and are offering new service delivery models. Why? It’s not for charity. Innovation is a business strategy that allows market leaders to stay ahead, and for market challengers to carve out a niche and win new business. I.e. this is all about business – and a very competitive one as well. Again, where is the common ground here?
- And then the other buyers…the ones that really matter the most – the clients. Again there is little obvious common ground here. As an outsider to the legal sector one might assume that inhouse legal teams were driving the charge for change, but few actually are in an explicit manner – though the number grows everyday. Many GCs still actively demand hourly bills for example, as they grew up in that world. Some are not that excited by tech and process change, efficiency or cutting costs. As one senior inhouse lawyer memorably said to me once: ‘Cutting legal costs is irrelevant, the value we bring to the business is immeasurable, that’s how we help the business.’ I.e. take your tech and your talk of efficiency and shove it where the sun doesn’t shine. So, let’s not assume all clients are demanding change and share a common cause either.
- And almost finally, the consumer and SME market – that vast, largely unmet need all over the world – that can’t be served because lawyers are so inefficient that they are inherently too expensive for most normal people to use for anything but the most basic of legal needs, or where the lawyers feel confident they can do a ‘no win/no fee’ arrangement. In such a world it’s not surprising that most people never meet a lawyer in their lives, and probably don’t spend too much time considering how tech and law are combining to change the means of production. So, looking for a common cause here also seems doubtful.
- And finally, governments and their justice systems. State-funded courts want to save money. But, the lawyers that work in them understandably want to be paid a decent income (e.g. witness the barrister strikes in the UK over low legal aid payments). So, there is a tension there. Even projects such as we see in the UK and Singapore, where governments help to drive innovation in their legal markets can sometimes feel like it’s becoming a national competition to make one jurisdiction more attractive to international litigants than the other, rather than having any common, global cause either.
But, Maybe…….There Is Something We All Share
After reading the above, it would be quite reasonable to conclude that the idea of a shared purpose in the LLT world is frankly a pipe dream and not just hard to achieve, but technically impossible given the range of disparate and sometimes competing interests.
But…..there is hope, although it may not be the answer some are looking for. For me, and Artificial Lawyer as a platform, there is a unifying goal.
The purpose of legal services is to meet the needs of a rules-based society in the most efficient and economical way possible so as to ensure access to justice and prevent the poor allocation of capital in the economy. (That’s my view, at least.)
I.e. if you make legal services more efficient and automate the process work lawyers will be able to better respond to market needs with lower prices. Lower legal costs won’t mean poorer lawyers, it just means a business model where more matters are handled – and where lower costs may well help to expand that market. In short, society wins and lawyers still make money (….so don’t panic!).
Therefore the LLT world does have a common purpose, it’s just one that is so overarching that most of us probably don’t spend much time considering it. The same goes for private business in general, for example, while it certainly makes a lot of money for people, and creates jobs, its overall purpose is to provide the goods and services to society that society needs to function.
We could go further into ‘benign self-interest’, i.e. X works hard to make loads of money, and in doing so helps to create products that help society as a whole, but you get the point – our immediate drivers contribute to a common good that we may not consciously focus on.
For me, this is what the LLT world is all about. Technology is – over a long-term pathway – helping to reduce the cost of legal services to society – or it should if it is to have any justifiable purpose. Just as technology improvements have delivered better communications and transport to society.
There is indeed a common cause, a shared purpose, and that is to reduce the cost of legal services to society.
Does everyone wake up in the morning and say: ‘Great, I get to help reduce the cost of legal services to society!’ Probably not. But, many are helping in what they do. Whether this is a law firm that is driving a strategy of automating process work, or a GC who is rejecting the billable hour and instigating a wave of small, but important changes to how their company produces the legal products it needs, or a company providing the software to help automate some aspect of legal process work. It’s all part of the bigger picture.
The challenge is that even though there is a common cause, can we get everyone to rally around it? I don’t think we can.
The better route is perhaps simply to encourage everyone to keep pushing for change and questioning the status quo. We can then only hope that real change and fulfilment of this deeper purpose happens by default.
By Richard Tromans, Founder, Artificial Lawyer and Tromans Consulting (June, 2020)