Outpaced and Overwhelmed by Work: LegalTech Needs a New Prioritization Playbook
Introduction
It is fair to say LegalTech and innovation are at an inflection point. The volumes teams are dealing with are unprecedented and many are realising that the current order of things can’t go on.
To set the scene, a few years ago when I was a partner at a large law firm, one day our core leadership team became aware we were becoming overwhelmed by work. We stood back and analysed what projects and systems we currently supported and/or were implementing compared with ten years ago. The list was materially bigger, albeit the size of our team was relatively similar. If I were to do the analysis now, I am sure the ratios would be far more extreme.
We increasingly see this phenomenon in other law firms where people are becoming increasingly busy by stealth. So why is this? There are several reasons. Firstly, most IT professionals I know are keen to help and so they respond to customer demand and are “can do”. Secondly, they are also focused on ensuring their firms have modern performant technology which results in new systems and upgrades. Thirdly, everything they implement brings legacy (and legacy arrangements to manage). This is all compounded by the fact in the last five years we have seen a steady increase in interest from lawyers. Generative AI has caught partners’ attention meaning that they have a genuine interest in digitising and a greater desire to engage. The order book is therefore growing.
Further issues
A number of you will have heard me talk about the digital onion. In the past IT professionals worked on infrastructure technology at the centre of the onion. This could be delivered by three or four people in IT to deliver benefits to say a thousand. IT professionals and innovation people are now working on projects at the outside of the onion which get under the skin of legal work. This means they are in essence dealing with potentially 1000 projects that benefit four people. All of these projects are hugely time consuming and require deep engagement, working with lawyers who are time poor due to unpredictable client demand. No IT team or innovation team is geared up to this.
The Next Wave
All of the above add to demand but very little is being reduced, meaning that the problem is becoming worse. We are now also seeing the next phase of challenges to add to the above:
a. A tsunami of solutions are now hitting the market.
b. Procurement challenges are getting harder due to the increased cyber and supplier diligence we need to undertake.
c. Cost management is becoming a bigger issue due to SaaS contract dynamics and is again a draw on time both re: procurement and ongoing management.
d. Microsoft 365. Although Microsoft is hugely beneficial in terms of functionality and is a great leveller Microsoft 365 “The Great Leveller” - Managing Partners Take Note — Hyperscale Group Limited, it also presents multiple training and tech stack challenges and changes.
And then there is more…
As if resource demands are not bad enough, we are now going through a huge period of change driven by the following:
a. AI is becoming embedded in all of our systems and working practices. This brings with it a plethora of due diligence and wider risk and commercial issues, and we are only at the start of this journey. This will continue to evolve, driving the need for transformational change for years to come. Organisational change will be part of this too.
b. We are seeing the growth of AI agents and Satya Nadella predicts the death of SaaS Satya Nadella | BG2 w/ Bill Gurley & Brad Gerstner. Others are predicting profound organisational and HR change https://www.linkedin.com/posts/jamescaancbe_artificialintelligence-futureofwork-entrepreneurship-activity-7340260759098044416-Bvop?utm_source=share&utm_medium=member_ios&rcm=ACoAAABcMXkB_5_0oRwhEeg1U1QUaJKvOvPpZ3M. In short everything we have known could be changing and our tech strategies rewritten.
c. An increasing number of firms are launching products to drive recurring income.
And so, what should we do?
Fundamentally it is time for a new approach. The prioritisation methods of the past simply won’t work anymore. They will become non sustainable, and we need new approaches. There is no cookie cutter answer but doing nothing is no longer an option. Any solution will probably be a bricolage of a number of approaches and some things will have to go.
Potential solutions we are working on with clients include:
a. Focusing on capabilities (not products) needed for the future.
b. Optimising platforms to be fungible and more focused on client and fee earner needs.
c. Leveraging Microsoft 365 to the full.
d. No Code systems allowing decentralised development within a governance framework.
e. Selective outsourcing and partnering with new funding models.
f. Being brutal about legacy and the prioritisation of “retirement” projects.
g. Training and upskilling lawyers for the future using tools such as The Professional Alternative and wider.
h. Clarifying current and ongoing responsibilities with legal groups to ensure they play their role in the solution.
i. Resolving the missing middle The Search for the Missing Middle — Hyperscale Group Limited.
j. Understanding and experimenting with Microsoft Fabric.
k. Implementing new project prioritization methodologies with tiering of project importance with different models supporting this.
l. Greater statistical and data analysis to facilitate discussions (inc SaaS usage stats).
The future
Although we all have views, nobody truly knows what the future will bring but it is clear that the prioritisation model needs to change. We cannot keep accumulating tech legacy and we need to choose our future projects carefully. We also need a new process which is more agile so we can swiftly deliver to enable us to move with the market. The model too needs to be sustainable from both a spend and project prioritisation basis. This needs active thought, and we will not arrive at the correct destination by being passive.
Above all It is vital we don’t become the overwhelmed “tech hoarder” of the future building problems for the next generations.
Hyperscale Group are an Independent Digital, Innovation, Operational Advisory, and Implementation Business with over 25 years plus deep market experience. We work for In-House Legal teams and Professional Services Firms all around the world and support them developing and implementing their strategies. We help our clients to make the right things happen.
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For more information, please contact Dereksouthall@hyperscalegroup.com
