For years, the headlines have been pessimistic: fewer jobs for law school graduates, downsizing at firms, and a declining reputation with the public. But according to a report by the Law Organisation, results foresee a future where the legal sector not only prospers but leads the most exciting changes in our society.
The team made up of lawyers and executives in the legal industry spent a full year mapping the most significant trends in technology, economics and cultural change to how law firms actually work and consulting big thinkers at leading companies and universities, authors and reporters, and designers from around the world who are already sketching the future.
The conclusion? Law is facing disruptions like those that reconfigured media, telecommunications, health care and other fields. As in those industries, the changes will introduce unexpected challenges and unprecedented opportunities, and will undoubtedly produce new winners and losers. Firms on the right path will have to face the hard truth that their actions today won’t be understood for years. Yet their reward will be an opportunity to reshape the legal industry.
Here are seven guides to how today’s firms can prosper from the coming disruption.
1. Technologies will enable lawyers to bill for real value.
Findings: Many lawyers are already experimenting with digital tools to enhance their practices. But the most powerful new technologies will likely be developed by innovators outside the traditional legal industry who are incentivized to offer basic legal services for radically lower costs.
The opportunity: The automation of basic legal transactions will initially cut into firms’ bottom lines. But more nimble firms will incorporate useful tools to reduce costs no matter where they come from. Others will bring disruption in-house by hiring or acquiring talented technologists and their intellectual property. Either way, firms that accept these changes will be able to shift to premium billing as they perfect the high-value products only the most creative counsellors can provide. Firms will also discover entirely new forms of practice, like computer-assisted law, that can only be pursued in this technological environment.
2. Firms will develop offerings that transcend jurisdiction.
Findings: As the pace of globalization quickens, the nature of jurisdiction will change. It’s not just that corporations and other institutions will need to navigate dozens or hundreds of sets of rules and regulations — they’ll also have a significantly greater need to choose among them. These clients will expect their counsel to keep up.
The opportunity: Firms will employ technologies to help them rapidly understand how a transaction might play out across all possible jurisdictions. Then, crucially, they’ll use their human ingenuity to craft offerings that transcend jurisdiction, maximizing clients’ freedom to act across the globe in real-time. Top legal minds will help regulatory bodies and intergovernmental organizations figure out how to make sure everyone plays fair in this new arena.
3. Demand for responsive institutions will create new markets for accountability.
Findings: Enabled by technology, citizens are demanding greater transparency and responsiveness from corporations, government and other institutions — which very frequently seem caught off-guard. In a world where a WikiLeaks is around every corner, institutions will need more than just good PR; they’ll need new tools to fortify their credibility and maintain public trust.
firms that accept these changes will be able to shift to premium billing as they perfect the high-value products only the most creative counsellors can provide.
The opportunity: Firms ready to tap into this new market already adhere to a “triple bottom line,” evaluating their success using metrics beyond profits. Smart firms already understand how important the element of trust is to their long-term viability. Such firms will be well-positioned to help repair trust in other institutions, whether they have been on the wrong track for a single quarter or a quarter century. They’ll do it not by throwing up walls around institutions’ secrets, but by crafting policies and practices that help all kinds of organizations remain transparent and accountable.
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4. Firms will tap new talent and enable new pathways to practice.
Findings: All kinds of companies are coming to grips with how they will acquire the skills and abilities they need in a workforce of unprecedented demographic and cultural diversity. Many organizations are also faced with the challenge of rapidly developing capacities they never needed before. Law firms will need to figure out how to hire new kinds of minds and address ongoing value concerns from clients.
The opportunity: The firms that prosper from volatility in the talent pool will be those willing to experiment with new paths to success. They will be willing to redefine traditional constructs such as partner, associate and of-counsel, while jobs like project manager and client service manager will become increasingly prevalent. New positions such as programmer, business analyst, industry advisor, etc. could be filled either by lawyers or professionals with other backgrounds. These new positions will organically increase firms’ intellectual and demographic diversity. Firms that adopt more flexible work practices and pay structures will be best prepared to compete with other industries for the capable people needed to fill these new jobs.
5. Transparency will push firms to seek hyper-specific markets.
Findings: Clients will have much more access to objective information about the effectiveness of firms and individual lawyers. Public companies in particular will face increasing pressure to rely on firms with the best track records.
The opportunity: Forward-looking firms will seek to define and dominate niche markets in which they can credibly claim to be the best. As with other industries, changes to legal markets will increasingly be driven by organizations’ collective ability to produce disruptive innovations, in addition to individual lawyers’ skills and experience.
6. Firms will launch R&D departments to create new offerings.
Findings: The variety of demands on law firms will lead to a new diversity in the way legal solutions are conceived, packaged, sold and applied. Some of these novel legal products will immediately find vast markets; others could take years to catch on or turn out to be false leads.
The opportunity: To keep up with the pace of change in the field, firms will create R&D departments that use product development methodologies to explore new ways of practising law. These departments will be tasked with imagining offerings that respond not just to changes in technology, but to shifts in industry needs and client preferences. They will also initiate “Skunk Works” projects in which a small group within the firm is given greater autonomy in the name of rapid innovation.
7. User research and innovation will shape client experience of legal products.
Findings: A deeper understanding of users’ experience is increasingly becoming the driving force behind the offerings of all kinds of companies. Companies are using data and design to predict consumers’ desires, aiming to appear in their lives before they even know what they want.
The opportunity: Firms will fortify relationships with clients not only through great customer service but by using everything they know about them to anticipate their future needs. The firms that are best at this will build innovation pipelines around their understanding of entire industries, approaching their clients with new opportunities instead of simply reacting to their problems.
The stakes for 2023 are greater than today’s industry metrics of gross revenues and profits per equity partner. Taken together, the seven opportunities we’ve identified represent a chance to build a legal industry that is radically more responsive to the demands of clients as well as society. With such potential at hand, today’s lawyers should use these principles to imagine the new value they can realize, not just for their firms, but for everyone.
Sourced from Law 2023 Report
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