So What is the Difference Between Innovation and Legal Technology

Legal professionals live their lives by a set of values provided by their firms including ‘law tech’ and ‘innovation’. However, are these values just buzz words or do they have an actual meaning? This article examines the difference between the two and the challenges lawyers face when seeking to adopt such measures.

What Is Innovation?

This term has left many lawyers bamboozled. The definitions provided by firms to explain it are so long and tedious as to render it meaningless. Following its collaboration with the Solicitors Regulation Authority, Oxford University produced a report in July 2021 entitled ‘Technology and Innovation in Legal Services’ which provided some clarity. Within the report was a detailed study into the term ‘innovation’ and broadly it was interpreted to mean improving the product, delivery and marketing of legal services.

What Is Legal Tech?

Oxford University helpfully interpreted the term ‘legal technologies’ to mean technologies which have the goal of replacing old fashioned ways of providing legal services. Such solutions are being used more and more to assist lawyers so they can benefit clients more efficiently. Law firms have been using a wide variety of technologies in the hope of stealing a march on the competition. Client engagement seems to be a priority with many firms adding more engaging content and features to their respective firm websites such as chatbots, portals and handy information to assist clients.

What Challenges Have Law Firms Faced With Adopting Innovation into Their Company DNA?

In its survey the SRA explored the challenges faced by firms when contemplating introducing innovation and legal technologies into their respective organisations. Numerous reasons were promulgated in response. The report broke the surveyed firms into two broad categories:

• Those strongly considering implementing legal technology; and
• Businesses opting against introducing legal technology and innovation.

Interestingly for all firms surveyed the number one reason for not implementing legal technology was the shortage of financial resources and capital available to invest. The firms opting to use legal technology cited uncertainty and regulatory barriers as key considerations in the decision to adopt such measures. The business world thrives on certainty and there is often a disconnect between what law firms expect to gain from adopting innovation. Some firms cited a selection of regulatory issues which put them off from adopting such measures. Following the survey firms would be best advised to check their insurance position before deciding to introduce such technologies. This will to ensure they can mitigate against the risk of client confidentiality being breached and they are covered if a data breach occurs. They should also seek further independent legal advice, so they are aware if regulations or legislation introduce any difficulties.

So Why would Firms Choose Not To Innovate?

The Respondents to the study provided different reasons for not introducing innovative technologies into their firms such as:

• The perception of innovation not being a high priority
• Needing to channel their financial resources elsewhere
• Innovation is not required at the business.

The respondents to the survey suggested that the SRA could be offering better support to adopt legal technology and innovate. The main suggestions appeared to be:

• Clearer guidance
• More assistance to comply with regulations and legislation
• Greater monetary support
• Measures to increase confidence and trust in using technological solutions.

One fail safe measure lawyers can use is attention to detail. Prior to sending documents to clients lawyers should be reading documents before pressing the send button on a system resulting in information falling into the wrong hands. This is seemingly not the fault of legal technology but lawyers themselves. The report makes for interesting reading. It highlighted the differences between innovation and legal technology. If the suggested measures are adopted, it could set the long-term weather for the profession.

ASSESSING FIRMS

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SOURCES USED WHEN WRITING THIS ARTICLE

[1] Sako, Mari et al. – Sako, M. & Parnham, R (2021) Technology and Innovation in Legal Services: Final Report for the Solicitors Regulation Authority – University of Oxford - full-report-technology-and-innovation-in-legal-services.pdf (sra.org.uk)

[2] Legal Services Act 2007

[3] SRA corporate strategy 2020 to 2023 – 20 March 2020 - SRA | SRA corporate strategy 2020 to 2023 | Solicitors Regulation Authority

[4] Sir David Clementi (2004) Review of the Regulatory Framework for Legal Services in England and Wales: Final Report - [ARCHIVED CONTENT] Legal Services Review - Report - December 2004 (nationalarchives.gov.uk)

[5] Legal Services Board (2018) – Technology and Innovation in Legal Services. November.

[6] Oxera Consulting Limited (2011) Market segmentation – a framework to monitor the legal sector – Report for the Legal Services Board - Market Segmentation - The Legal Services Board