Almost every leadership book ever written talks about the importance of delegation and surrounding yourself with brilliant people who are each experts in their own discipline. For a long time, this was the prevailing attitude from Managing Partners towards technology. But when does technology cease to be peripheral and become a core competence?
When law firms become technology companies that just happen to specialise in legal services, is it still okay for the leader to shrug her shoulders and point to the IT guy?
This article will explore this current evolution for law firms and what it means for the role of Managing Partner. Please note – this interview contains quotes provided by interviewees on The Transformation Network. To see the original interviews, please visit the below links:
The first question to ask is – are we there yet? Are law firms essentially technology companies that happen to specialise in delivering legal services (just as Amazon is a technology company that happens to sell consumer products and Uber is a technology company that happens to sell taxi rides), or are they fundamentally the same as they’ve always been, but merely with technology enabling things to be done that little bit bigger, better and faster?
The answer is probably the latter but the trend is only going in one direction. Make no mistake, in ten years EVERY market will be a technology market, and it will be those companies that begin thinking and acting that way today that will turn this trend to their advantage.
Over the last few months, we have asked numerous Managing Partners and CEO’s how well informed they feel they need to be. Some have talked about the need for having lots of channels through which they can be kept well informed on new technology, while others have gone much further and suggested that the leaders of the future will be as likely to come from a coding background as from law school. The one consistent has been that they have all recognised that an understanding of technology is central to leadership roles of the future.
In fact, having surveyed nearly a quarter of the UK’s top 200 firms, we found that developing an insight into technology was ranked by the majority of Managing Partners as one of their top focus areas for the next 5 years.
As Ray Berg, Managing Partner of Osbourne Clarke, explains – “Understanding technology is just part of the job, frankly. It’s about almost being as much of a sponge as possible and soaking up as much information from as many different sources as you can, and then using that to work out where to go next.”
Perhaps one of the most insightful perspectives is to be found from the CIO, as these are the people with the best view of the incoming technology tsunami.
We spoke with Jo Owen, CIO of Cripps, who explained “Our managing partner now has an understanding of technology and I just think that’s going to get more and more important. We were at a recent board meeting and the subject of technology was most of the evening, and yet I was the only technology role in the room – everyone else was a Managing Partner. Almost everything they were talking about was how technology affects what they’re doing today, and that’s today! So in 5 years time that will be even more so!”
A point reiterated by Head of Technology at Bird and Bird, Karen Jacks – “Our CEO is a tech and comms lawyer himself, not practising now, very busy as CEO, but very much embraces how we can use technology, supports us in exploiting new technologies and gives us the support of our executive committee and board in our IT strategy.”
So how does a Managing Partner start building the law firm of tomorrow? How do they ensure they are staying ahead, or at least keeping up, and building a culture of technology-driven innovation that drives real business results?
Naturally, everything begins with the vision and strategy – technology is merely a facilitator – and this vision and strategy can only come from the top.
As Ed Turner from Taylor Vinters, a firm renowned for its work within the technology sector, told us: “Having a culture of innovation is a positive thing but you need to be clear on why you’re doing it, and that begins with the organisational strategy. That’s crucially important both in terms of the decision making but also in terms of implementation. From a decision-making point of view, you’re looking at an incredibly diverse set of options in the market. If you’ve got clarity of what you’re trying to achieve as an organisation then you immediately have a very clear framework against which to make those decisions.”
A point reiterated by Jo Owen “Changing cultures, changing anything, has to be led from the top, and everyone has to believe in it and know where they’re going and why they’re going there if it’s to then change things at a grassroots level. So I think that’s really important. People need to understand why, what it means for them today and tomorrow and the day after that.”
Turning technology to your advantage demands that you move quickly, and the faster you move, the greater the uncertainty. Technology companies have long embraced this culture of “failing fast and early”, as they understand that the alternative – to attempt to remove all uncertainty and risk – will inevitably result in analysis paralysis and the entire initiative being killed before it’s begun.
Instead, they define acceptable levels of analysis and risk mitigation before investing in implementation, and then focus on the most challenging aspects, rather than the features that be be added at a later date. This acceptance of risk is a deeply troubling notion for law firms who have long been rewarded for their care and caution.
This shift in attitude can only come from the top. The Managing Partner must communicate that taking (controlled and carefully considered) risks is absolutely integral to making progress. It is not enough to simply celebrate the wins, you must also positively acknowledge the initiatives that didn’t work out as planned.
As Ed Turner explained – “One of the things that underpins successful innovation is an ability to fail and then learn and move on quickly. That is quite difficult in a law firm environment, principally because the psychology of lawyers is achievement-driven so failure is perceived as a very negative thing. Therefore, you have to work quite hard to reframe that so learning in the implementation of projects is not failure but success. “So that didn’t work but you changed that… Well done!”. You have to work hard so that those individuals who are willing to take a personal risk are held up as heroes rather than being vilified for failure.”
There is another way to address this resistance culture which is so prevalent in law firms, particularly among middle management who are measured by objectives that often conflict with innovation. As Jo Owen explains: “Some of the really big firms are setting out different entities, different businesses almost, to try new services through innovative means or tech start-ups [in a way] that doesn’t affect their day to day legal business. We have an internal group, the Imaginarium, that spends time looking at different solutions or different start ups or different ways of working but very separately and doesn’t affect their day to day work… There are lots of different ways of approaching this.”
It is not realistic to expect that the leader of a law firm is going to know everything going on in the ever-changing world of technology, but they do need a strong radar for those things that are of the greatest direct relevance to their firm, otherwise their strategy will be shaped by their blind spots.
Building a strategy to ensure this constant flow of information is one of the most important things a leader in the legal sector can do. There are various avenues through which this information can be gathered:
We asked Ray Berg, Managing Partner of Osbourne Clarke, how he stays up to speed – “We’ve got a number of different sources of insight. Our clients are a great channel and our office in Silicon Valley and San Francisco are also conduits for seeing what’s coming down the line. We have a Head of Technology & Change to feed into our exec board on a monthly basis and keep us abreast of the changes. I also attend networking events and just generally try to immerse myself in what’s going on. You might go along and think a particular technology has no relevance to you but at least you can understand the way things are going.”
Perhaps the most common mistake made where technology is concerned, not just with law firms but in all markets, is the tendency to view it in a silo, or as a solution for flawed processes. Technology can be an enabler but if it isn’t integrated into the way your business works, it won’t deliver benefits and could destroy existing value.
As Keith Stagner, CEO of T-Impact, says: “If a broken process is automated, then you risk simply making the same mistakes faster. And if you also take the humans out of the process, your customers are liable to feel the impact.”
Up to 70% of the work performed by staff in most organisations is wasted. Staff spend their days undoing work performed by others, often in different teams. Using a process-centric approach to design your technology solutions will help identify & eliminate this waste across your organisation.
It is important that any technical solution is designed to support/improve your business processes, dealing with both normal and exceptional business conditions. It should enforce the controls that ensure quality and provide the evidence needed to monitor and report your success.
As a leader, it’s unlikely that you will be getting hands-on with the development of systems, but constantly challenging your leadership team on key questions is imperative if you’re to know that they’re making smart decisions:
As part of ensuring the correct systems and processes exist, it can be helpful to have a “hub and spoke” model, where there is a central technology department ensuring consistency throughout the organisation, but also a degree of involvement from each department. After all, these are the people who will best understand the specific processes and controls required for their world, onto which the technology can then be placed to achieve greater value from that system.
One particular area of challenge for law firms is regarding their practice management systems (PMS). They often swap out one PMS for another based on the fact that it is online or has some new feature. However, if they haven’t understood how their businesses work before trying to implement the platform, they are very unlikely to achieve the benefits commensurate with their investment. Firms can often achieve the benefits they are looking for much faster and more cheaply by using newer technology that can work with their existing PMS. AI, Robotics & work flow, for example, can deliver great benefits with little/no change to the existing PMS. They can also cleanse your data while they work – simplifying any future move in PMS.
Transformation projects rarely fail because of the technology. They fail because the company has neglected to consider the impact across the organisation, design a solution that delivers holistic benefits and communicate why the project is important. Once again, this needs to come from the top. The team needs to understand why change is happening and what it means for them.
As Ed Turner explains, it begins with good old fashioned change management techniques – “Don’t start large. If you’ve got a cohort of people within you know there are going to be a bunch of enthusiasts who are going to adopt it whatever, a bunch of people that will want to see that it works, and then come over to it, and a bunch of people who are never ever going to engage with it. The usual rules apply. Don’t waste your time banging your head against a brick wall with the people who are never going to adopt. Start with the people who are going to be naturally enthusiastic about it, get them to do some of the early pathfinding with it, and as you get some results you can start to build a strong business case for the undecided, the second wave of adopters.”
Part of this is also about using the right language. For example, in reference to robotic process automation, Jo Owen makes the following point – “I think by calling it robotics it makes it sound really scary. So by going to a lawyer to talk about robotic process automation and they’re like “Really, you’re going to fire me really soon…” And we’re like “No, what we’re going to do is make it so that when you’ve ticked these boxes it gives you the right client agreement.” “Cool, can I have that now?”
Like it or not, we’re all a product of our environment, and when that environment has barely changed for a hundred years it can be really difficult to shake off our assumptions and open our minds to new possibilities. Consequently, innovation within the legal market is often limited to doing things better rather than doing better things.
One way of overcoming this deep-rooted mental barrier is to look at other markets that are perhaps further along in their transformation journey. That way, we can replace the abstract with real life examples that demonstrate what true innovation looks like.
As Ray Berg explains “We’re in the process of developing our 2025 strategy and we went to an external consultancy to advise us on products, which is not the obvious place for a law firm to go but we wanted someone who would challenge and probe. After all, just because it’s always been done a particular way in a law firm, why can’t we learn from what’s being done in consumer-facing markets? The black-letter law is almost a given now, but it’s what you can add around that, and I think looking outside the profession is going to give you an advantage because you’re going to come up with new ideas. In the past innovation for law firms has often just been keeping up with the Jones’ and doing what your nearest competitors were doing, but to truly challenge and disrupt you’ve got to look at what’s happened in every other market and law’s not immune from that.”
Dan Garrett of Farewill takes it a step further and urges CEO’s and Managing Partners to think more like the kind of tech companies you’d associate with Silicone Valley – “I think the main thing would be our obsession with working things through from first principles. It’s a sort of cynical agnosticism that says it’s okay to challenge everything, which is precisely the opposite of how most law firms operate where it feels like the culture can be unquestioning, pre-determined, and driven by hierarchy. Let’s be honest, if you were an alien sent to Earth with the goal of designing a company to provide consumer legal services, you would never end up with the legal firm structure as it exists today. If you’re always thinking in first principles then you’re always innovating.”
There is an understandable fear that with robotics and AI now being adopted by the majority of top firms, white collar workers are an endangered species. However, the reality is that these transformation projects rarely result in lost jobs, as progressive firms understand that the human dimension has never been more important. There is no greater tool a firm has in its arsenal for impacting customer experience than its people. The technology is there to free those people up so they can spend their time on activities that directly shape the customer experience, rather than on unseen and undervalued administrative duties.
As Dan Garrett explains – “It’s the mix of humans and technology that’s so powerful. At first, we didn’t include any human interaction [in Farewill]. It was a well-designed product but without that human element, it just didn’t convert well. Now, however, we have live chat and phone lines, and our customer interaction has become a major strength.”
Managing Partners still believe that if they surround themselves with great technical people that will be sufficient. It won’t be. Technology is now so fundamental to the legal market, both from an operational perspective and in terms of the platforms through which they engage with their customers, that if a Managing Partner doesn’t have a reasonable level of insight into technology and digital transformation, then they will find themselves working harder than ever just to stay in the race.
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