LegalTech and Small Legal Departments

The LegalTech revolution seems to favor larger legal departments – though it’s teams of 10 lawyers or fewer who stand to benefit the most from the time savings it promises.

On average, 57.6 percent of law departments report using more technology tools to increase their efficiency, according to the Altman Weil Chief Legal Officer Survey. However, if you break that down by size, you see the larger legal departments disproportionately leading the tech charge.

• 81 percent of law departments of 51 lawyers or more report using more technology
• At 11 to 50 lawyers, that falls to 62 percent and
• By 2 to 10 lawyers, it’s a 50-50 split

Small law departments aren’t a small sector of the in-house population. According to the Altman Weil survey, 49.6 percent of in-house legal teams have 10 lawyers or fewer.

Why do smaller legal teams report a significantly lower use of technology tools? It comes down to time, according to three in-house lawyers we interviewed: Susannah Jobling Hodgens, Legal Counsel at Orora Limited; David Levy, Senior Supervising Counsel at TelstraSuper; and Patrick Hurley, Chief Administrative Officer and Chief Counsel of the Kansas City Area Transportation Authority. This trio shared their perspectives on the benefits and challenges of LegalTech – and advice for their small department compatriots.

Small legal departments, big challenges

On a small in-house legal team, Susannah said, “it’s all hands on deck for all types of work. Workload is high, covering all manner of legal matters, and continues despite team travel, flexible working arrangements, annual leave, et cetera.”

Indeed, the three lawyers agreed that in smaller legal departments, lawyers are expected to cover a broader range of subject areas. David said that it was necessary to be a “jack of all trades,” and that on a small team, there was a more acute need to prioritize work and balance competing interests and deadlines.

While very niche practice apps for IP or employment have their uses, Patrick said his primary needs were time management and triage: “There needs to be a balance between being involved in day-to-day operations and having time to provide the needed legal services.”

Susannah, David and Patrick all have implemented a cloud based legal operations software to manage their department’s matters and workloads. (In the spirit of full disclosure, all three are Xakia users.)

Some of the benefits they have found with a cloud based legal software:

• Susannah: “Better visibility of matters, reporting, understanding where team members are at and not leaving it to chance!”
• David: “Deeper analysis of who is doing what work and where the pressure points are coming from between the different business units.”
• Patrick: “Matter tracking and organisation is particularly beneficial to small in-house law departments, because its added functionality over the old-school method of using spreadsheets … We can also save time by loading the invoices into our legal matter management system as opposed to individually tracking legal service invoices.”

The sizzle of using an in house legal software aside, some tasks are more suited to a more traditional approach. Susannah said her department will continue to favor the human approach for complex contract review and company secretarial work.

Selecting and implementing LegalTech

What’s on the small department LegalTech wish list?

• Contract management
• Self-service tools for corporate customers
• In house legal software that compares bills from outside counsel to legal services contract provisions
• AI that can identify and process day-to-day business matters

Making it happen, however, is a challenge. It’s ironic that so much of LegalTech is designed to save time, Susannah said: “The only problem is finding the time to scout, select and then implement.”

David agreed, stating the primary obstacle to LegalTech was “finding the time and resources to complete the required due diligence on the providers to make sure the right decisions are made.”

It's critical for small in-house legal teams to approach LegalTech with an eye toward the ultimate ROI, Patrick advised: “You have to carefully balance the needs with the scale of investment. For example, would it really make sense to purchase an expensive product that may do more than you need and you may not have the staff to actually benefit from the technology or the analyzed data results?”

Two practical ways to start: Complete the Legal Operations Health Check to determine your department’s specific needs, then create an in-house Legal Technology Roadmap to prioritize your tech initiatives – and ensure they work together.

Advice for small in-house legal teams

The small legal team leaders provided three tips:

1. Acknowledge LegalTech is worth the investment (and the investment may not be huge)

It’s worth taking the time to explore and install LegalTech for your real pain points, said Susannah: “Solutions today are not as expensive as in the past.”

2. Use technology to know what your team is doing – and show what your team is doing

Susannah also recommended using a matter management software for in-house legal departments to categorise matters and chart how the legal team spends its time – for example, value-add matters vs. low-level work that could be handled differently. “This is a powerful message to show senior leaders how much time lawyers are spending on certain types of work,” she said.

3. Share LegalTech outside the Legal Department

Patrick said LegalTech tools should not just be deployed by the legal team, but shared with management and business clients: “It speeds the process up and allows your legal department to focus more time on the mission-critical matters.”

If you would like to learn more about Xakia's legal matter management solutions, speak to the team today for a demo.