Legal Tech, Cloud, Legal AI, Automation & EfficiencyJuly 10, 2024

What They Didn’t Teach You in Law School: Why Technology is a Necessary Investment for Law Firms

lawyer sharing technology with other lawyers

If it ain’t broke, don’t fix it, right? Everyone hates to spend money on replacing technology that seems to be working “just fine”. Law firms, in particular, have a reputation for not investing in new tech because there always seems to be a “better” place to spend the extra cash. (We get it – if Windows 95 still works like a dream for you, that’s great!)

Why buy a new car if your 2005 Toyota Camry with an odometer north of 200k is still chugging along? Or why should you replace your HVAC system (installed while Bill Clinton was still in office) when your home’s temperature is still reasonably comfortable year-round?

You have a good point! Why SHOULD you upgrade and invest in new things when your existing tech seems to have no downsides?

Laura Kennedy, co-founder of Circle Management Group, has decades of experience helping law firms choose the right technology that will enable them to meet and exceed their goals. She firmly believes that keeping your technology decisions on autopilot can be detrimental to long-term success.

"Technology is an investment. It is not an expense. You get something out of an investment whereas an expense is just an expense." 

Legal tech investments she advocates for include cloud-native solutions, artificial intelligence (AI), document automation, client portals, case management platforms, paperless billing, secure text messaging, online help forms, and more. These technologies enhance efficiency, client communication, and operational effectiveness.

In her webinar, What They Didn’t Teach You in Law School About Running a Law Firm, she shares several reasons why investing in technology is a crucial element for success.

Opportunity costs can be larger than you think

Let’s revisit the earlier examples of the beloved Camry and decades-old HVAC system. While it might be cognitively painless to simply replace each of these items with similar ones that don’t offer anything in the way of an upgrade, take a minute to think about opportunity costs.

For example, what fuel efficiency, safety measures, or even entertainment might you be missing out on when you’re driving a 2005 Camry versus a car from 2024? How much are you paying for monthly utilities to keep your most likely energy-inefficient HVAC running? It always pays to consider the opportunity cost of the status quo before deciding to stick with what you currently have. When it comes to your wallet or safety, investing in an upgrade should always be prioritized.

Clients have greater expectations than ever

Clients are increasingly demanding convenience, 24/7 communication, and cost efficiency from law firms. Technology plays a crucial role in meeting these client expectations and enhancing client satisfaction.

The old rules of communication (landlines staffed from 8-5) no longer apply. For example, today’s law firms are using SMS texting and client portals alongside email and regular landline to communicate 24/7 with clients.

Having more than one way to communicate not only enhances firm flexibility, it also helps maintain a positive perception of client support. The more omnipresent a communication channel becomes; the more people expect to have it as an option with every company they choose to work with. Once an expectation is set about what defines a “positive customer experience,” it can be very off-putting to potential clients if this standard is not met.

Remote work is on the rise

Fully remote law firms are not the norm today, but many law firms have embraced a hybrid office work model or offer staff the option to work from home during inclement weather or if they need to care for a sick child. Not only does the ability to work remotely support uninterrupted productivity, but it’s also incredibly helpful for completing quick (or emergency) tasks while away from the office or accessing case information at a moment’s notice 24/7.

Hiring staff from outside the U.S. is also becoming more popular. When using a cloud-based case management platform, law firms can weave these “virtual staffers” seamlessly into their existing workflows and clients are never the wiser about their location.

Data security and governance has become increasingly difficult

It’s become routine to read about hackers stealing information from large company databases. As cyber threats become more complex, managing security on your own becomes more challenging. Using software that offers substantial security protections offloads the burden from your IT team. It’s a myth that keeping data stored in an on-prem server is more secure than keeping it in the cloud.

Ensuring the security of sensitive data and maintaining compliance with regulations are also essential aspects of technology adoption in law firms. Compliance is substantially easier when you are adopting technology that already incorporates the myriad regulations into their products.

Managing and leveraging knowledge becomes immeasurably easier

Technology tools support knowledge management within law firms, enabling efficient case management, document assembly, task management, data analytics, visualization, and proactive information sharing for improved decision-making.

Firms that adopt technology like case management platforms are better equipped to track, measure, and act on information that surfaces inefficiencies.

The benefits of adopting modern technologies are clear, but what about the risks of maintaining the “status quo”?

Risks of ignoring technology

A ceiling on progress

Some firms resist updating technology by stating, "We've been doing it this way for years and we don't have any issues." This resistance to change can hinder progress and innovation within the firm.

It’s true that you shouldn’t disrupt your existing processes on a whim, but it’s only logical to periodically take a step back to examine your workflows and technology with the intent of identifying barriers to continued success. If you find such barriers, it behooves you to explore options for addressing them to stay competitive.

Prioritizing short-term productivity over long-term

Concerns about downtime during technology upgrades can lead firms to delay necessary updates. These concerns are valid, especially for firms whose profitability hinges on their efficiency. However, embracing change and allowing time for data migration and system improvements are essential for improved productivity in the long-term.

Consider any necessary downtime or acclimation period to new technologies as part of the investment for future success.

Missed opportunities for growth

Ignoring technology can hinder collaboration, innovation, and productivity within the firm. Inflexible firms become resistant to change putting them at risk of becoming less competitive

Failing to invest in technology can result in missed opportunities for growth, client satisfaction, and operational efficiency. Technology investments are crucial for staying competitive and meeting client expectations in a digital age. Without proper tools and systems in place, firms may struggle to adapt to changing client demands and industry trends.

Making the most of technology with training

Say this article has convinced you that embracing modern technology is the best strategy for your firm. Great! Now you just need to ensure you provide your staff with adequate training.

“I remember one time I was talking to somebody, and they said, ‘You know, I really don't know that about this training. That seems like an awful lot of training. And that's a really big amount of money to do training.’ I'm like, ‘Well, you know, that, that contract you just signed for me, why don't you take all that money and go out in your yard and set it on fire? Because if you do not train your people how to use it, you are, you are not going to get any type of, any type of return on that investment at all whatsoever’.”

Acquiring staff buy-in

Training is only effective when you have employee buy-in. Leading the charge from the top down is critical, but it’s equally important to have technology champions at different seniority levels of the firm. Maybe it’s your secretary or assistant; maybe the head paralegal is the main influence at your firm. The more people you can persuade to champion new technology, the more their positive attitude will help convince the rest of the staff to embrace the change.

Ignoring new technologies may seem preferable, given the concerns of downtime and costs incurred, but this strategy rarely leads to long term success. Embracing technology as an investment rather than an expense is crucial for ongoing sustainability of law firms.

Looking to upgrade your firm’s technology with a cutting-edge cloud-based case management platform? Tell us what you want to achieve with your firm, and we’ll share how Neos can help.

Watch the on-demand recording of Laura Kennedy’s What They Didn’t Teach You in Law School webinar.


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