SaaStock is coming to Dublin from 14-16th October. It is a conference specifically designed around growing software businesses – with talks about investment, growth and lessons from those who have already succeeded in the industry.
SaaStock has a number of high quality speakers on their agenda from across the startup ecosystem. This includes investors such as Accel and Point Nine Capital, successful tech companies such as Stripe, Intercom and Active Campaign and business advisors.
SaaStock also contains a dedicated Startup Programme which gives high potential startups the opportunity to exhibit their company and ideas, attend dedicated workshops and meet investors.
The Startup Pitching Competition gives startups the chance to compete for an amazing prize – the winner gets $25,000 cash, a number of ‘partner perks’ from SaaStock’s partners and global recognition as a high potential company.
To find out more or sign up for SaaStock, please visit here.
Our team at Thread Legal will be attending the conference – we’re looking forward to learning from other software as a service founders and applying these insights to our own growth journey with our innovative case management software solution.
We’ll be live-sharing our experience throughout the day, so please do come and say hi!
In simple terms, collaboration involves people working together to achieve a shared goal. It is rare for a lawyer to complete a case from start to finish without input from other lawyers and legal staff such as secretaries and paralegals. Equally, law firms can often become siloed – with poor communication between different departments leading to missed opportunities and unhappy clients.
Given the importance of working together at law firms, it is understandable that partners can be eager to sign up to new technology claiming to improve collaboration.
However, unless you make meaningful changes to your processes as well as your technology, people will go back to their old communication habits. The same old frustrations and inefficiencies quickly resurface. So how can law firms ensure that their investment in case management, document management or other technology results in improved collaboration throughout their firm?
Understand how your organisation currently operates
Give specific guidance on how you would like your organisation to communicate once the technology is implemented
Proactively enforce the rules that you have set up
Be fanatics about ensuring that your system is kept up to date
If you’ve had a look at our website, you know that Thread Legal is a cloud product – we’ve made our decision that the future for legal software is in the cloud.
However, in parallel with our clients we made the move from being a server-based software company (www.expd8.com) to a cloud technology company. During this process we ourselves had to look at the opportunities and the risks that come with the cloud and we wanted to share some of our thinking processes with lawyers who are also looking to make this change.
Is Cloud Software for Everyone?
There are good reasons for some lawyers globally to stay away from the cloud. There have been recent examples of several countries shutting down their country’s internet during political unrest. There have also been several (admittedly rare) examples of smaller countries losing their internet connection due to accidental cutting of critical cables. Mauritania lost internet access for 48 hours in 2018 due to a trawler cutting critical undersea cables.
Cloud software makes lawyers less vulnerable to localised system failure (e.g. your office internet connection going down). However, it does make lawyers more vulnerable if regional internet disruption takes place. If lawyers are worried about this, then server-based software may make more sense.
Is Cloud Software Right for My Company?
The global cloud computing market was worth $180bn in 2018 and is predicted to grow to $411bn by 2020 – a huge growth curve. This growth is facilitated by multiple industries, including legal, moving towards the cloud. So, what are the reasons for this?
The ability to work outside of the office is one of the key advantages of cloud technology. It benefits both equity partners and employees alike.
A survey by Virgin in the UK found that 87% either worked flexibly or wanted to work flexibly – 92% for 18-34, 88% for 35-54 and 72% for 55+ years old. The most common reasons cited were gaining more control over work-life balance (57%), general usefulness (50%) and cutting down on commuting times (33%). Whilst 29% still cited caring for children or dependents, this shift shows that flexible working is no longer seen as primarily for those with family responsibilities. It is desired by the majority of the workforce for a variety of reasons.
Virgin also make the point that top candidates with multiple options are likely to be part of the majority that desire flexible working – so law firms who want to retain the best talent are wise to make flexible working a part of their office policy.
In addition to talent retention, flexibility offers a range of benefits on a company level. Meeting clients, being in court, attending events – there are many work-related reasons for lawyers to be out of the office. With a cloud case management system, lawyers do not have to wait until they get back to the office to update their file, create documents or share information with colleagues. All they need is a laptop or smartphone and an internet connection. A coffee shop, a hotel lobby and even a car can all become spaces in which productive work can be done (although we do not recommend updating your case management system whilst driving!)
This also means that client needs can be handled in real time. When an important client rings the lead on a case, that lawyer can access all of the case information instantly. They do not have to ring their secretary in the office and ask them to check the file before they can respond. It also means that out of working hours client emergencies do not require hauling everybody back into the office. The team can access all information from home and situations can be successfully dealt with remotely.
Using cloud case management can also reduce the fear that managers can often feel when allowing staff to work remotely – the lack of accountability. With cloud case management, managers can see in real time the work that their employees are completing. They can give feedback on it and can ensure successful and timely delivery of objectives.
In terms of the bottom line, flexible working can also reduce overheads as employees who are spending more time working outside of the physical office consume less electricity, less consumables and even less tea and coffee (and biscuits). It can also reduce the recovery costs in the case of a physical disaster such as fire or flooding. Even if the office is out of action, the company does not have to be because everybody can work from home with whatever devices they have available.
At Thread Legal, as we began to move to a more flexible working model we saw the many benefits it provided – and this was one of the key reasons that we decided to create a cloud case management system for our customers. Since Thread Legal was introduced, we have had a number of clients switching to us who were otherwise happy with their server-based system but desired the flexibility that only cloud can provide.
Many lawyers cite data security as one of the reasons why they are wary of cloud software and to a certain extent this is true. Lawyers who store their data in a server or paper files have them physically in the office with them. They can see them, lock them away and have a sense of personal control. In contrast, lawyers using cloud applications allow a third party to process their data and have to trust that this third party will keep their data safe.
However, security concerns have also been raised about the safety of office-based systems. In 2014 the UK Information Commissioner’s Office (ICO) released a warning for barristers and solicitors about data breaches. They specifically highlighted the use of paper files as troubling due to the lack of the encryption and because transferring papers between locations can increase the likelihood of a serious data breach.
Even when firms store data on an encrypted server, there are security concerns. Local storage is particularly vulnerable to physical disasters such as fire and flooding or a break-in. The security available is also limited by budget – small and medium firms are unlikely to afford enterprise encryption or other online protection.
In contrast, when firms choose a reputable cloud provider they receive the security protection of that provider. For example, Thread Legal is hosted within Microsoft Azure. Microsoft Azure protects customers’ data with:
High barrier fencing around the entire datacentre with cameras that are monitored 24/7
24/7 threat management and security monitoring throughout the entire datacentre
Two factor authentication including biometrics in order to access any part of the datacentre
Pre-authorised access so visitors can only access areas they have been previously approved to enter
Data encryption both in transit and at rest
Built in anti-virus and anti-spam
It is unlikely that even relatively large law firms will have the budget to implement biometric access to their data or 24/7 security monitoring.
When Thread Legal was looking for a host for our cloud software product, we looked at a number of options before deciding to build with Microsoft and host in Microsoft Azure. Just as we suggest for law firms, we did a thorough due diligence, looking at their security features and independent certifications.
Not all cloud providers are created equal – and this is where law firms need to do their own due diligence on the cloud hosting solution, rather than just trusting the claims of the platform provider. However, if law firms choose a competent software provider and cloud host, they can get enterprise level data security for SME pricing.
When lawyers are using a server-based system, updates are often pricey and installation causes business disruption.
With cloud software, good suppliers will automatically roll out regular updates without any business disruption or maintenance required. Server-based clients may get an update once a year at most and will most likely have to purchase it. Thread Legal, as an example of cloud software, releases a new update at least once a month which is deployed automatically to all users.
As technology involves, cloud users are always able to take advantage of the latest developments and updated product features. As the software provider continues to innovate, law firms do not need to fear being left behind with outdated technology.
Should I Invest in Cloud Based Legal Software?
Here at Thread Legal, we invested in building our platform because we believe that not only is it the technology for the future, it is the technology that lawyers should be using right now to provide the best experience for both their clients and their employees.
Cloud technology has the power to change the way a law firm works – it can be leveraged not only to provide more flexibility for workers, but also to serve clients better.
In addition, it can give law firms greater levels of data security and a solution that continually provides access to the latest technological innovations and new features.
Investing in cloud software is one of the best things partners can do to improve their business operations now and prepare their firm for the future.
Since AI started moving out of academia and into industry, people have been worried about the effects on employment. Ideas such as ‘universal income’ have been introduced as potential solutions for human workforces start to become redundant.
Are lawyers under immediate threat from ‘robot lawyers’? In this article we’ll take a look.
What is a Chatbot?
In its most basic definition, a chatbot is
‘a computer programme designed to simulate conversation with human users,
especially over the internet’.
In their more basic forms in the legal
industry, a chatbot could sit on the firm’s website and complete functions such
as booking appointments and asking questions that direct an enquiry to the
right department of an enterprise firm. However, chatbots at this level cannot
be conceived as competition to a lawyer.
The chatbots under discussion in this
article are those developed to solve problems for customers, rather than just
direct customers. They can answer basic legal questions and can also generate
standardised documents such as NDAs based on information inputted by the client.
They resolve an individual’s issue without the need for interaction with a
human lawyer. These chatbots may contain artificial intelligence (AI) to help
them refine their response to questions, and will almost certainly contain AI
in the future.
The Chatbots Helping Customers Right
The DoNotPay Phenomenon – Chatbots without Lawyers
In 2015, DoNotPay was revealed to the public. It was originally designed to help overturn parking tickets. Drivers would input the reason they would like to challenge the ticket and give their details, with the app filling in the relevant forms for them.
In 2018 it expanded into small claims,
filling in the forms required and offering a script that plaintiffs can read
from in court. Outside of the legal arena, DoNotPay also offers Uber and Lyft
refunds, fighting bank charges, airline and hotel price protection and the
ability to scan fast food receipts and receive free food.
DoNotPay has received significant amounts of media coverage – partly due to its charismatic young founder (who rented Mark Zuckerberg’s old house in Silicon Valley for a time). Joshua Bowder introduced himself in 2016 with these words: “lawyers all over the world should be scared of this technology”. Whilst his rhetoric has softened his vision is still that all consumer legal services will eventually be provided for free.
In addition to DoNotPay, there are several chatbots on the market which aim to fulfil client needs without any lawyer involvement. LISA offers NDAs and has recently launched into the property market. SoloSuit helps US consumers to respond when sued for a debt.
Chatbots that Support Lawyers
Supporting consumers for free is a laudable
aim, but doesn’t lead to a financially self-sustaining business – DoNotPay is
venture capital backed with an aim to monetise in the future, and LISA is
reported to be looking at corporate licencing deals.
This is why the larger number of legal
chatbots being developed are designed to be used by law firms rather than to
work against them. The real revenue opportunity lies in leveraging these
platforms to gain more chargeable work, rather than using them as a sole
Some of these are being developed by large
law firms themselves. Norton Rose Fulbright in Australia developed
a chatbot dealing with changes to data protection legislation. Clients
could ask the chatbot simple questions, and then refers them to fixed price
packages if further legal advice is required. It was responsible for selling
A$15,000 of business within its first 24 hours.
Ailira is another Australian offering for consumers and small businesses, which offers a certain level of free legal advice and documentation and then offers users chargeable legal appointments if they would like documents checked or further advice.
The Roadmap for Chatbots
Chatbots without Lawyers
One of the key points about DoNotPay that
is rarely picked up by the media is that its main audience is not the tiny minority
who would hire a lawyer to pay a parking ticket – its main audience is those
who would have paid the parking ticket, and now have an additional capacity to
‘Access to justice’ is an important issue,
and a key area where this type of chatbot could play a positive role. Asylum
seekers, visa applicants, those in debt, those unable to afford a lawyer for
civil matters – all of these could benefit from the DoNotPay model.
This social good is important, and worthy
of support. It is also unlikely to significantly affect lawyers’ bottom lines
as these are situations where people generally can’t or won’t hire a lawyer. These
products expand access to legal advice into new areas rather than affecting the
areas that law firms currently gain revenue from.
Chatbots that Support Lawyers
This is a more interesting case. Legal
chatbots developed by law firms could affect the shape of the legal industry as
As discussed in the previous section, this
technology is already available. Speaking purely in technological terms, there
is no reason why chatbots could not be implemented by firms worldwide.
Some firms, such as Norton Rose Fulbright
who were mentioned previously, have begun doing just that and have seen
increased revenue as a result. However, the fact is that implementing a chatbot
involves a significant change in business model. For most firms, the current
business model works fine and so there is little incentive to change.
For forward-thinking firms who want to be
known for a modern and innovative mindset, this is a great technology to look
at from both a revenue and a PR perspective. For firms who are happy to stay
just ahead of the curve, it will most likely be several years before legal
chatbots become popular enough to become a serious consideration.
How Chatbots will Change the Legal
Whilst widespread implementation may not be
immanent, it is very likely to occur at some point. When it does, it will
change both the legal industry and the makeup of individual law firms.
Automating the basic level of client
interactions firstly requires a different fee structure. Clients will
presumably pay either a regular subscription or a fee per interaction. Either
way, this fee will likely be smaller than the fee clients currently pay for a
Law firms will therefore need to create
revenue on the chatbot via increased volume – both within individual clients,
who may use additional services when the cost is lower, and being able to
support a much higher volume of clients. If a reasonable portion of those
clients convert to paid projects with human lawyers, then law firms can
increase revenue rapidly and effectively. Successful firms could grow rapidly
with a relatively small increase in headcount.
The rise of chatbots will change the
dynamics within businesses. Whilst lawyers will be needed for the content,
non-lawyer staff including technical teams, marketers and business developers
will increase. As multiple firms develop chatbots, differentiating via
marketing and other means will become more important and will increasingly
direct business strategy.
Lawyers’ workloads will also change, with a
focus on higher value work that cannot be completed by the chatbot. The level
of change will depend on the area of law and client base, with some areas
almost untouched and some having a significant percentage of their previous
workload handled by a chatbot.
Chatbots, however, will not replace human
lawyers in the short term, and are unlikely to in the long term. A similar
comparison is e-discovery platforms – which reduce hours of time spent
reviewing documents, but in no way reduce the need for litigation lawyers who
interpret the data, represent clients in and out of court and negotiate
settlements. For as long as individuals look to achieve their goals and protect
their interests through legal means, they will need human lawyers to support
One concern is that chatbots will reduce
the number of positions for individuals completing those more manual,
repetitive tasks. Some of those are positions that would be filled by recent
law graduates and associates – which could lead to a shortage of experienced
lawyers further down the line. The legal industry will have to be mindful of
this in order to avoid a talent shortage and find ways to move junior lawyers
onto higher value work more rapidly.
At this moment in time, legal chatbots are
an opportunity, but are unlikely to be a threat. They are an opportunity for
those who want to expand legal access to those would currently be
unrepresented. They are also an opportunity for law firms who want to become
the early adopters of this technology, and to drive a new type of business
model that could bring new types of revenue.
For law firms who are happy to continue
with their current operations, legal chatbots are unlikely to be a significant
business threat in the near future. Law firm owners can keep an eye on this
technology, and consider it again when early adoption has started to become
Finally, unless you are a lawyer who deals
solely in parking fines or standard NDAs, the ‘robot lawyers’ are unlikely to
be coming for your job any time soon!
On 8th January 2019 in Dublin, Ireland, it was reported that a law firm lost €97,000 in a cyber scam after the hackers intercepted an email between the solicitor and their bookkeeper and changed the bank details for a payment. It was shared with the newspapers by the Law Society, who wanted to warn other law firms about the risks and kept the firm’s name anonymous.
On 15th January 2019 in Kingaroy, Australia, it was reported that a law firm lost $148,554.11 of client money after a wire transfer to a fake account. It was shared with the newspapers by the angry client and the firm has since ceased trading.
These are just the first two published stories of 2019 –
there will certainly be more, many which are never brought to public attention.
Why Is the Legal Industry at Risk?
Due to the nature of legal work, even sole practitioners can
be processing five-figure or higher payments and sensitive personal data.
Cyber-criminals want both of those things and will proactively target law firms
to get them.
Whilst enterprise firms will offer a larger prize to
successful criminals, smaller firms are often less protected. This is why
smaller firms as well as large are being targeted, and business owners cannot
assume that they are too small to be actively targeted.
In 2016, QBE reported that $120 million had been stolen from
law firms by cybercriminals in the previous 18 months. With the overall global
cost of cybercrime now rising to $600 billion per year it is unlikely that this
figure will decrease any time soon.
On another note, whilst most law firms will not have breaches on the scale of the Panama Papers, a loss of trust when client information is stolen can be fatal to the future of small and large firms.
Cybersecurity is not something that should be left to the IT staff – it is a matter of business survival and Managing Partners need to take the lead in ensuring their firm is safe.
What Can I Really Do? Even IT Firms
The truth is that there is no 100% fool-proof way of preventing cybercrime. However, there are plenty of things you can do to reduce your chances of being a victim. It’s not so different from physical security – locks and an alarm cannot prevent your house from being robbed 100% of the time, but locks and an alarm are undoubtedly better than just locks, or nothing at all.
The following steps are not a comprehensive plan for IT
security – every business has different IT system weak points and your plan
should be tailored to your company by a professional.
However, there are practical steps that all business owners can
and should be following today:
Don’t leave your cybersecurity to the IT people
Law firm owners are not IT specialists and hiring either an
outsourced supplier or IT Manager, depending on the size of a business, is a
good idea. However, a business owner’s responsibility does not stop there.
“When we first engage
with law firm owners, many of them cannot answer basic questions about their IT
set-up and what protections are in place,” said eXpd8’s Shane Branagan, who
specialises in IT managed services for law firms. “They hire an IT specialist
and then just pay the bills. This lack of oversight leaves firms dangerously
vulnerable, and if the worst happens it is the firm and not the IT supplier who
will bear ultimate responsibility.”
Law firm owners are
not IT specialists, and they do not need to be – however, they do need to
understand enough of the basics to have an overview of what is needed and to
interrogate any suggestions made by an IT supplier or manager. IT security
should be discussed at board and management team level.
The good news is that learning about basic cybersecurity has
never been easier. Most country-level Law Societies will have resources to get
you started, there are plenty of articles on the internet and many
cybersecurity companies offer free webinars that will go into topics in more
To get you started, here is eXpd8’s checklist of the basic
protections every business should have:
Email spam filter
Watch Out for Passwords
Passwords are a tricky area, and there’s plenty of
conflicting advice on best practice. However, whilst IT security experts are
arguing over password managers and the optimum number of passwords per person,
many law firm owners leave big holes in their security by not following some
Don’t use the same password(s) for your personal and work accounts. Breaches on e-commerce and other sites happen all the time – don’t let them affect your business.
Don’t use a password someone can guess. Your children’s names, birthdays, the road you live/ have lived on? Hackers don’t need malware when you use such easy to guess information.
Use two factor authentication on applications with sensitive data. Two factor authentication feels like an inconvenience but is highly effective. Shane Branagan from eXpd8 said that he found it was one of the first thing firms implemented after a data breach to increase security. Be ahead of the curve and implement now!
Keep Your Programmes Up To Date
Do you remember the WannaCry ransomware attack in May 2017
that affected more than 200,000 computers in 150 countries? This was an issue
that had been identified, a solution found and an update released. The attack
affected those who had not downloaded the relevant Windows update.
Cyber threats are ever evolving, and most ‘new features’
updates also include new protections against recently identified threats. Making
sure that your applications are up to date helps the software providers to keep
Make Sure Your Employees Know What a Suspicious Email Looks Like
Cyber-security training for employees is recommended by all
IT security professionals and all businesses should give their employees
regular and comprehensive cyber-security training.
Yet in a sample survey, Eset found that only 17% of employees surveyed had received ‘a lot’ of cyber security training, and 33% had received none at all.
The advice of this article is to do as much cyber security
training with your team as possible. However, if you have limited time and
resources then the best place to start is training on email security. Email is
one of the key intersections between people and technology and email scams are
getting more sophisticated and more frequent.
Do your employees know the key signs of phishing? Have they
heard of CEO fraud? Do they know what to do if they receive an email with a potentially
suspicious link? Do they know how to identify a spoofed email address?
Unless you can answer a confident yes to all these questions
you need to arrange some training. It doesn’t have to be expensive – there are
plenty of free online courses, or training platforms you can sign up to for a
I’m Following All of Your Tips – What
As described before, the legal industry is a particular
target of scammers due to the combination of sensitive personal data collection
and their processing of large sums of money. This means that of course you need
to invest to make your business as safe as possible – and consult with
professionals on a comprehensive plan. You also need to be prepared for if the
worst does happen.
If you have business within the EU, data breaches must be reported within 72 hours. If this happens, you want to be 100% focussed on resolving the data breach and minimising your exposure rather than splitting your attention between the data breach itself and learning about how to report it. Even if you operate outside of the EU, you will still need a plan to communicate with clients promptly whilst resolving the issue.
Larger organisations will need to do more complex
preparations and involve IT providers and internal staff within the planning.
All organisations, no matter the size, should at a minimum have read the
reporting guidelines for their country, put together a template for themselves
to fill in and assigned internal roles in case of a breach. The 72 hour
reporting requirement includes weekends, so you should also think about what
happens if the breach is noticed between Thursday and Sunday.
‘Cybersecurity war games’ but are a useful way of testing
your plans and making sure that there aren’t any gaps that you’ve missed. For
larger firms, hire a specialist to make sure tests are comprehensive and catch
anything your internal staff have missed. For smaller firms, you can identify a
scenario and run it to its conclusion without needing consultants or a big
In conclusion, whilst the threats are significant and ever
growing, there is plenty that law firms both large and small can do to protect
against these threats and to prepare for if the worst does happen. Lawyers have
a responsibility to protect their client data and funds to the best of their
ability and this means taking a proactive approach to cybersecurity rather than
just hoping for the best.
As businesses reach the end of their fiscal year, they review performance and look ahead to the next year – setting targets and creating goals. Is investing in technology on your list? We’ve put together a few tips to consider to help you achieve your goals in 2019.
Ask Your Team
Investing in a new case management or other technology system is a financial investment – and as such is made by the management team or the board. This can sometimes mean that the voices of paralegals, secretaries and office managers, without that decision-making authority, can be lost.
These regular system users can often have the best insights into current pain points, and what is required in a new system. In order to get the best ROI from your investment, proactively include employees across all levels in the company in the decision-making and implementation process.
Set a Go-Live Target Date
Everybody in your firm will be busy all year. If case management or other technology projects are not timebound, they always will be deprioritised behind other time-sensitive projects.
When you give your project a specific deadline, it gives the team the impetus to put other work aside and focus on the project. It also gives the company a better awareness of when a project is slipping, and they can then make an informed choice on what to do next – rather than a passive choice being made by everybody being too busy.
Assign Clear Responsibility
Technology deployments need two levels of project owner – one at Executive level and one at Project Manager level. In small businesses this may be the same person, but mostly it is two different people.
Except for in large organisations, the Project Manager is unlikely to have a technology implementation project as their sole responsibility. Projects often start to slip when a) the Project Manager is overstretched and trying to juggle too many things or b) other members of staff do not complete required tasks.
The Executive level individual needs to be there to support the Project Manager with these issues at board level. They should have the authority to authorise redistribution of workload for the Project Manager, and to hold other individuals to account if they are not completing project tasks. They should also be held accountable at board level for the project proceeding on schedule.
Businesses will always have competing priorities, and times when technology projects need to come second to urgent, revenue generating work. Having assigned project owners at executive and implementation level helps ensure that technology projects do not get forgotten amidst busy workloads.
Plan Your Timings
You’ll always be busy, but every business has peaks and troughs – either seasonally or client-based.
As much as possible, it is best not to plan to implement a new system during your busiest period. Equally planning training and deployment during a peak holiday time for your employees can also become a logistical nightmare.
There will never be a perfect time when nobody is busy or away. Equally, planning ahead can ensure that you are completing key project stages during time periods which will minimise business impact.
Take the Leap
New software companies initially release a ‘Minimum Viable Product’ and then iterate from there – they do not wait until the product is completely perfect in every detail before releasing to users.
Equally, whilst you should make sure any technology you give to your employees is viable for use, you should plan for and expect changes and development post-deployment. Once your employees begin using the system, they will have role-specific feedback and suggestions for you.
Make sure that your system is usable from day one, but don’t wait until you think everything is ‘completely perfect’ before you release it to your employees. Your system will always have room for improvement, and employee feedback is vital for creating a system suitable for everyone.
New Year – New You
As technology is constantly evolving, staying ahead of the curve should be on everyone’s New Year to-do list.
If you are planning to make a major investment this year, make sure that you follow our five tips to help make this your best year ever!
On 23rd November, VP of Market Development Sabina Horgan spoke to Ari Kaplan from ‘Reinventing Professionals’ about legal technology in Ireland, and leveraging practice management software to gain a competitive advantage.
To listen to the 10 minute podcast, just click on the link below:
As a lawyer, you probably hear a lot about new technologies, but don’t have time to sit and read through pages of technical information to understand if or when they’ll be relevant to your practice.
In this series, we will cover some of the major technical innovations within the legal industry from a lawyer’s perspective. We’ll tell you not just how they work, but the implications for practicing lawyers now and in the future.
Our next topic: Artificial Intelligence.
What is Artificial Intelligence?
Standard software is only able to follow instructions – instructions found within its code.
Artificially intelligent software is designed to mimic ‘human intelligence’, most specifically in terms of learning, planning and problem solving.
‘Machine learning’ is integral to this process. Just as with human intelligence, artificial intelligence develops through learning. However, in this case datasets are provided to the machine. The machine goes through an initial ‘training’ period – where it tries to complete its task and is given feedback on how well it has done. Once commercially viable, the artificial intelligence algorithm continues to incorporate feedback from data gathered, making it increasingly more accurate.
For example, the algorithm within a self-driving car needs to identify whether it should pass through a traffic light or not. If the traffic light is red, amber or green this is relatively simple. If the traffic light is broken, or is flashing, or the coloured glass has been smashed and so it is displaying a yellow light in the red-light position, the algorithm also needs to know what to do. Multiply this by all the other repetitive decisions made by a driver every minute on the road. Something that seems intuitive to a human can require a lot of machine learning for an algorithm.
Where Is Artificial Intelligence Being Used in the Legal Industry Today?
One of the key areas in which artificial intelligence is currently used is in eDiscovery. AI makes search more effective by learning about what human reviewers are looking for and providing what it believes is the most relevant information, rather than traditional Boolean searching. It makes eDiscovery quicker, cheaper and much more effective.
eDiscovery tools vary in their level of sophistication but are now relatively widespread in their use by firms engaging in litigation. The worldwide market is expected to grow to $10.7 Billion in 2018. eDiscovery software is now available for SMEs as well as enterprise firms, often on a ‘pay per gigabyte’ basis.
AI has been developed to answer legal questions, highlighting relevant information from published and unpublished case law.
AI can be used in several areas within this. The first is to understand lawyers’ questions. Boolean searching can easily miss data if you are not matching exact terms. Natural language processing, and area of AI, works to understand what information humans are looking for when they ask a question, and providing relevant material.
AI solutions can also be used to analyse a brief of other legal documents. It can provide information about cases cited within the document that highlight the most relevant factors such as cases which have received negative treatments. It can highlight the most relevant paragraphs, to aid in skim-reading. It can also look for similar cases in the same area of law.
Again, AI is used to analyse the information so that lawyers receive only the most relevant information. This saves lawyers significant amounts of time and resources.
Some free tools are available, but comprehensive offerings are primarily available with an enterprise price tag at the moment.
Recently, software provider LawGeex challenged 20 experienced lawyers to a competition – reading an NDA. LawGeex software took 24 seconds and had 94% accuracy. The 20 lawyers took an average of 92 minutes, with an average 85% accuracy.
In addition to fast and accurate identification of potential issues, AI-supported contract reading can also help companies to compare contracts across multiple business divisions, and to identify potential issues within contracts within seconds. For example, a company could specify clauses they always approve, those they always reject and grey areas. Once the software has received this information, it can present companies with an analysis of areas that need a human lawyer to look it.
This software is currently primarily aimed at the in-house market – where it has a clear use case, and large volumes of similar use cases can cross lawyers’ desks.
However, as this technology grows we expect it to cross into enterprise law firms, and eventually SMEs.
What is the Future of Artificial Intelligence in the Legal Industry?
Clear use cases for artificial intelligence have already been identified, and there has been a recent growth of legal technology start-ups building on artificial intelligence technology. Expect these applications to become better and for the number of products to multiply.
Whilst this article has primarily focussed on AI applications, as general artificial intelligence tools improve, lawyers should expect AI to become a component of everyday applications as well. For example, case management software should begin to incorporate elements of AI, and some (including Thread Legal) already do. In these instances, AI will be used to enhance automation and document management features – so will blend into the interface and become part of the user experience.
What This Means for Lawyers
Although, of course, there are as many opinions as there are people, the common consensus is that artificial intelligence will not replace the need for lawyers any time soon. What AI will primarily do is reduce the time that legal teams spend reviewing data – whether that’s contracts, discovery data, case law or other documents. Lawyers will then spend more time on higher value work that needs human involvement, primarily the analysis and judgement calls. An AI software may identify potential risk factors in a contract much more quickly than a human could – but a decision on whether to challenge the terms, or to accept them in order to avoid the deal breaking down, is a judgement call that lawyers and their clients need to make.
In terms of adoption times, there are several AI software solutions on the market that are fully developed products suitable for adoption by firms of all sizes, and in-house legal teams. However, there has been much market discussion over why these technologies are not being adopted as quickly as expected.
The general expectation is that in-house legal teams will be the first users of AI legal technology. For in-house lawyers, efficient use of resources is a key metric – and it is therefore easy to see clear return on investment. However, the initial investment in, training, and ongoing IT support of an AI product can make adoption difficult for busy teams. Whilst use is increasing, it may be a couple of years before it becomes widespread enough to reach a critical mass.
With legal firms, the adoption difficulty is that billing structures can make adopting AI seem counter-intuitive in many cases. A reduction in hours available to be billed has obvious implications – equally, a flat fee that is designed to cover weeks of work will look excessive when weeks of manual review can now be done in seconds.
Several suggestions have been made as to how AI adoption will take place. One is that it will take place in response to pressure by in-house legal teams on their outside counsel. As in-house teams become more efficient through the use of AI, they will expect outside counsel to do the same and reduce their bills accordingly, and adoption will spread from there. Another suggestion is that a new breed of young firms will arise, which automate as much as possible through technology, and grow through volume of work. Enterprise firms, and then eventually SMEs, will have to adopt AI technologies in response to the changing market conditions that these firms will create. Adoption rates will probably vary greatly by region and area of law.
However it happens, the truth is the artificial intelligence is here to stay in the legal industry. Viable technology is already available – it is up to firms to decide when they want to embrace the changes to their business model that a meaningful investment would necessitate. For the moment, the industry is at the beginning of the curve, so lawyers have the choice to become early adopters, or to wait until industry adoption becomes widespread before committing.
As a lawyer, you probably hear a lot about new technologies, but don’t have time to sit and read through pages of technical information to understand if or when they’ll be relevant to your practice.
In this series, we will cover some of the major technical innovations within the legal industry from a lawyer’s perspective. We’ll tell you not just how they work, but the implications for practicing lawyers now and in the future.
First up: smart contracts.
Blockchain – The Basis of Smart Contracts
As a very brief explanation, blockchain is a distributed ledger in which all parties in a network have access to the ledger. As data is centralised and available to all, a ‘middleman’ is no longer needed.
A blockchain is set up to work on an ‘If-Then’ automated process. For example, if someone requests to transfer a bitcoin, then the ledger automatically updates to record one less bitcoin in the giver’s account, and one more in the receiver’s. Blockchain is designed so that these actions cannot be tampered with or halted once begun. This is what keeps blockchain and digital currencies theoretically secure from fraud.
If you want a more detailed understanding of blockchain, our favourite explanation is here.
Blockchain and Smart Contracts
A smart contract is a contract executed on a blockchain, or distributed ledger.
A payment in cryptocurrency would be made to receive a template contract, and would then be available to all parties. Parties can update the contract by mutual agreement before it is executed, and changes would be reflected on the distributed ledger.
Then, once the contract has been agreed, the idea of ‘automatic actions’ can be used to enforce the contract (for actions taken online). For example, with an apartment rental a digital key could be released in exchange for the deposit and first month’s rent. The ledger would record that if a payment is made by ‘x’ date, the key will be released on ‘x’ date. If the renter pays the deposit three weeks early and the owner or renter then changes their mind, it is not possible to refund the money and end the contract. The ‘if-then’ clause has been triggered and will happen regardless of other factors, so the key will be delivered regardless of either party’s wishes.
The Opportunities with Smart Contracts
When working correctly, smart contracts offer the chance to cut out the ‘middleman’, or lawyer for repetitive transactions.
A lawyer would prepare a series of template contracts, which would then be bought by the parties concerned with no direct involvement by the lawyer.
As the contracts are automatically enforced, there should theoretically be no need for litigation surrounding missed expectations.
This should remove the need for direct lawyer involvement in many common transactions, and therefore theoretically cause a dramatic shift in the legal industry.
The Issues with Smart Contracts
The issues with smart contracts are primarily around its digital nature, and the ‘If-Then’ model when it comes to real life situations.
The first issue is that as with all coded software, bugs can get into the code and cause unexpected problems.
The second issue is limitations based around the nature of these contracts. For a start, cryptocurrencies are currently required as the payment method. These are notoriously volatile, and even if legal firms and corporations begin to use them, lawyers dealing with consumers may struggle with widespread adoption.
In additional, the automatic enforcing of ‘If-Then’ digital clauses of the contract can create issues when real life dynamics come into play.
There are times when a party would want to stop a contract – for example, if they found out that the builder they had hired lied about the amount of work that needed doing and had dramatically overcharged. The contract continues to perform regardless of this new information. It cannot be rescinded in court or anywhere else.
Equally, there could also be times when a contract should be changed, due to evolving circumstances. For example, if payments were conditional on achieving milestones on time with financial penalties for late work, and then the scope changed. Both parties could agree to extend the deadline, but payments are automatically made based on the original contract terms – so cannot be amended. Parties would have to agree to make payments on the timescale of the contract, before work is completed, or create an additional agreement outside of the contract, to pay any monies deducted by the contract’s automated payments system.
Finally, there could be times when a mistake has been made in the original contract, but not noticed before execution. Both parties know the contract is incorrect but are powerless to change it. This may also necessitate in additional contracts being made to correct actions being made by the first contract.
Smart contracts make things simpler and cheaper when everybody agrees, and the contractual terms proceed as planned. When there are issues, however, its strength becomes its weakness. Whilst this problem remains, even when adopted smart contracts are unlikely to remove the need for lawyers – instead of drafting contracts, lawyers could find themselves negotiating additional agreements and workarounds for when smart contracts are not working for the parties within them. It would be ironic if those additional agreements were also executed via smart contract!
What This Means for Lawyers
The issues inherent within the ‘smart contract’ model mean that it will probably by implemented in non-legal contract type situations a long time before they are allowed as legal and upheld in courts.
For example, supply chains could benefit from this ‘smart contract’ model, as delivery of an item can automatically trigger the item to be re-made or re-ordered much higher up the supply chain, even when multiple companies are involved. If an item is incorrectly ordered, then the implications are relatively minimal.
For legal, the implications of a contract improperly executed and impossible to stop are much more significant. It will therefore be years before smart contracts are viable for legal professionals and accepted by governments. It will probably be even longer before they are adopted widely enough to create a critical mass and affect a lawyer’s workload every day. It is therefore something that lawyers should have on their radar, but not be immediately concerned about.
One thing to note, however, is that whilst it is the enterprise firms that will probably have the budgets to explore this technology first, it may be smaller firms whose caseloads are more immediately impacted. Smart contracts work best for repetitive contracts such as housing contracts, where a template is widely followed with few customisations. Work of this nature is often handled by small, local firms who would be significantly impacted if smart contracts took a percentage of their business. Firms working on complex B2B contracts, and on litigation, will probably be affected much later. Whilst smart contracts are supposed to remove at least a portion of the need for litigation, we suspect that governments will have to find a way to litigate around them when people are unhappy, and so lawyers and their clients will continue to have their day in court.
‘Life hacks’ are everywhere – helping people become more productive and efficient, whatever their walk of life. We’ve put together a few ‘life hacks’ for lawyers, helping to make each day better than the last.
Lawyers know that the legal industry is changing. As clients become more tech-savvy and time conscious, they expect their lawyers to change with them. ‘Standing still’ is the new ‘falling behind’.
But how do you, as a modern lawyer, manage that change and adapt your practice?
One of the key ways to change is to understand data around your industry, and then find ways to improve inefficiencies and lost revenue opportunities. Did you know that lawyers spend up to 30% of billable time doing costly admin activities and that the inefficiencies of a paper-based system are costing many lawyers up to 66% in additional revenue opportunities?
‘Life hacks’ are simple solutions to common problems – and one of the best ‘life hacks’ for lawyers is the use of an online practice management system. We’ve detailed below some of the ways in which a practice management system can be used to ‘life hack’ many of the inefficiencies and therefore lost revenue opportunities that lawyers face every day.
1) Automate your administrative tasks.Most lawyers have core documents that they use for multiple clients. Using templates within a practice management system, these documents will be generated in seconds. Think of the hours currently spent adding individual client details into documents – and then think of how much additional billing time would be available if practice management automation was used.
2) Record time whilst you work.Real-time time recording doesn’t just cut down on time spent filling in spreadsheets at the end of the week or month. More accurate data enables you to zoom in on inefficiencies and use your time in more valuable ways.
3) Assign clear tasks.In many area of law, the cases follow consistent processes. Setting up workflows which clearly assign the tasks to individuals along the process can reduce the amount of non-billable time associated with a case. Internal meeting time will be reduced as discussions will focus around case issues, rather than logistics and status updates. Colleagues will also be able to reduce the non-billable time involved in collaborating on cases.
4) Attach all emails to your case file.Most lawyers file case documents together. However, emails remain siloed and information gets lost. This can lead to confusion, delays and inefficiencies. When the whole case team can follow the dialogue with the client, work flows more smoothly and the team becomes more efficient.
5) Bill within minutes, not days.One study found American lawyers spent 2.3 hours a day on billable work, but only collected 1.6 hours’ worth of revenue. Delayed billing can contribute to this, as clients’ memories fade quickly. Delayed bills are more likely to be questioned or challenged, and clients’ circumstances could have changed, making them less able to pay. The ability to bill instantly has a positive effect on cashflow – collections will come in more quickly, and the amount collected may even increase.
A few simple steps can help modern lawyers to work quicker, understand their data and collaborate better with colleagues and clients. If you have any questions about how any of these features could benefit your business, please send us an email at [email protected], or request a demo.
Get in touch
Tell us a little about yourself and we'll be in touch