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Episode 67
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Practice Management and Business Skills
The Great Leveler? Using Legal Tech to Level the Playing Field
Law as stated: 9 December 2022
What is this?
This episode was published and is accurate as at this date.
David Bushby joins Hearsay host David Turner to scrutinise the world of legal tech, as well as discuss how to stay on top of technical developments to give your firm the edge.
Practice Management and Business Skills| What area(s) of law does this episode consider? | How small law firms can implement technology to level the playing field with larger firms. |
| Why is this topic relevant? | Driven by the necessity of the COVID-19 pandemic, technology is being introduced faster than ever into law firms. This uptake of legal tech has increased the efficiency of firms and helped reduce the workload of lawyers and support staff. However, the history of technology in the legal profession is complex and it demonstrates some of the difficulties of bringing newer technologies to the legal market. A deep understanding of technology – and the way people interact with technology – is crucial to the success of new technology in the legal sector. |
| What are the main points? |
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| What are the practical takeaways? |
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| How to: | How to effectively integrate technology into your law firm:
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| Show notes | Tech & the Law 2022, Thomson Reuters Future of Law and Innovation in the Profession 2017, Law Society of New South Wales Law Hackers monthly newsletter |
| David Turner:
1:00
2:00 | Hello and welcome to Hearsay the Legal Podcast, a CPD podcast that allows Australian lawyers to earn their CPD points on the go and at a time that suits them. I’m your host David Turner. Hearsay the Legal Podcast is proudly supported by Lext Australia. Lext’s mission is to improve user experiences in the law and legal services and Hearsay the Legal Podcast is how we’re improving the experience of CPD. The story of David and Goliath is an enduring reminder that sometimes our weaknesses are our greatest strengths. David triumphs over the giant Goliath by approaching their confrontation differently, in a way that plays to his strengths and using the right tools for the job, of course. Now, why are we talking about David and Goliath today on Hearsay? Today on the podcast we’re talking about how small law firms can level the playing field in the competitive landscape by playing to their strengths and using the right tools for the job. At the big end of town, global law firms with thousands of lawyers and seemingly endless resources have historically been the only players with the resources to take on those large lucrative matters and clients. But the landscape is changing and those big players can be slow to change themselves… And it’s not just in clients. It matters that law firms are in competition with each other. There’s also the competition for skilled people, and that battleground too is being leveled by technology. But knowing which technologies to adopt and which to leave behind can be a difficult question, and even the most savvy lawyers and law firms can feel like they’re getting it wrong. With me today on Hearsay, to discuss levering technology to even the playing field is David Bushby. David is the founder of Law Hackers, an online tech showcase for the latest and greatest in legal technology; and the managing director at InCounsel, which provides tech consulting and legal engineering services to help legal organisations select, implement, and support the right technologies. David, thanks so much for joining me today on Hearsay. |
| David Bushby: | Thanks, David. Great to be here. |
| DT: | Now, tell us a little bit about what got you into the legal technology space and a bit about your career generally. Was it a passion for tech or dissatisfaction with the way legal services were delivered or a little bit of both? |
| DB: | It wasn’t really either. It wasn’t really dissatisfaction. It wasn’t particularly passion that got me into it, I sort of trace it back to the 2008 financial crisis… |
| DT: | Right. |
| DB:
3:00 | … that kicked me out of an investment bank where I was working inhouse into startups, actually. So, I was fortunate enough to have a very good friend of mine that had launched a startup in 2006 and at that time that was a very new and sexy thing and I living vicariously through him and we were talking a lot about his business, which was essentially live streaming annual general meetings for listed companies and we were brainstorming about how we could apply that technology to the legal sector. So, me being booted out with a redundancy payout, I took that jump into a startup to launch that service in the legal market. So, it was very much a BD role to start with but I was surrounded by developers and technology and started to pick up skills in product management, wireframing, mockups, UX design, etc. Really got into the Australian startup scene at the time and learned as much as I could. Took those skills to London, spent a year as a product manager, education startup, but around that time the legal technology startups were really starting to spring up around the world. So, I set up Law Hackers, the newsletter that features four of those startups every week, in 2014. And that’s been going ever since. There’s been over a thousand legal technology startups featured in that newsletter and fast forwarding to today, that’s where a lot of my knowledge and passion and expertise around legal technology came from that background. So, we were able to help legal teams with selecting tools and implementing technology. So, that’s the story behind it. |
| DT: 4:00 | Wow. So, it sounds like it was really a passion for innovation on your part that got you into tech as a means to an end really. |
| DB: | Yeah, it was a passion. I didn’t really realise I had until I got into the startup environment. That’s where the light bulb clicked for me. It was getting involved with that whole ecosystem; really drew me in and I, probably, have always tinkered with technology. I self taught Photoshop at university and a few other technologies at the time and that really came back into this experience with startups where I was able to go, okay, pick up these skills again and work on these tools and geek out on them, frankly. |
| DT: | And what’s really interesting about that path to me is that there was a time when adopting legal tech in a law firm or in an in-house business, might have been considered exclusively for the innovative business or exclusively for the NewLaw firm but the adoption of legal tech is really not just for the innovative NewLaw firms, every legal service provider has to be using those tools just to keep pace, right? |
| DB:5:00
6:00
7:00 | Yeah, it’s an interesting one. My experience has actually been that the larger law firms were the fastest to innovate and adopt technologies. My own experience in working in large law firms to begin with was: it felt like quite a tech forward organisation. It was King & Wood Mallesons – at the time, Malleson Stephen Jaques. We had document automation. All of our precedents were automated to a basic level. We had iManage for the digital filing of emails. We did start doing due diligence exercises with pen and paper but that quickly moved to Microsoft Access databases. We had voiceover internet phones etc. and at the time it didn’t really strike me as being particularly innovative but when I moved to an investment bank, one of the largest in the country, we just didn’t have that technology. It felt like a step behind where I was in the private practice. It also resonates when I started at the first startup selling that livestream podcast technology to law firms. It was the large firms that moved quicker. I really struggled to get buy-in from the small and solo practitioners around the country I thought that would be the leveler, leveling, the playing field where we could spread the knowledge of these expert lawyers and small firms to compete with the large firms with their PR machine etc. but it was the large firms that took up that technology first and I have seen that trend play out with most of the legal tech verticals. It’s been the large firms that have moved quicker than the small firms, partly because they have the first heads of innovation, the digital transformation experts, the project managers. All of those roles and titles started in the large law firms and I think are yet to trickle down to the majority of small firms around. TIP: The idea that the bigger players in the law are the ones experimenting with technology is an interesting one. In 2022, David’s old firm King & Wood Mallesons, alongside MinterEllison, announced new automation partnerships. KWM locked in Luminance, a legal process automation provider, into its digital literacy program. MinterEllison, announced improvements to process automation with a partnership with tech-provider Appian with an expected saving of approximately 42,000 billable hours in the next year. KWM and MinterEllison are both large firms – the Goliaths of the legal world, to return to that analogy. The Law Society of New South Wales, highlights that the cost of adopting legal technology and artificial intelligence has likely led to a “technology divide” between large law firms and smaller ones. We’ll leave a link to that report in the show notes for this episode. So, in terms of leveling the playing field, I think the large firms probably still have the jump, but as you say, it’s probably more towards some of the non-traditional NewLaw players that are able to really innovate the business model as opposed to just the technology. |
| DT: 8:00 | That’s a great point. I want to come back to business model innovation as opposed to product innovation because it’s a great distinction to discuss, but I just wanted to talk about how interesting it is that narrative we often hear about law being slow to innovate, about law being slow to adopt new technology, about large organisations being slow to adopt new technology. That doesn’t really match your experience. It’s interesting that we hear that narrative so often, but it doesn’t necessarily play out in practice and it makes sense that the businesses that have the internal capabilities to identify these opportunities are going to be the ones that are most likely to adopt them. |
| DB:
9:00 | Yeah, absolutely. When you’ve got someone, say the head of innovation if you’re a tech vendor, you know exactly who to talk to and who to sell to. That head of innovation, it’s their job to look at the new technologies around in the market. So, they’ll be reaching out to vendors themselves. When you’ve got a small law firm, you’re busy just doing the legal work, it’s very difficult. I think it’s the number one barrier to lawyers carving out that bandwidth to look at new technologies, let alone implement technologies as well, which is the really hard piece. So, I do think, again, the larger organisations just simply have the resources, whether it’s private practice, large firms, or larger in-house legal teams. They’ve just got the people and resources to look at this stuff and think about process and innovation. So, I do find that my experience probably doesn’t match up perfectly with the narrative of the large players being the laggards. |
| DT: | Now, you identified an important exception or maybe an important opportunity there for smaller players, which is around business model innovation. Tell us a little bit about how you would define that as opposed to merely technology adoption or product innovation and why that’s an important distinction for smaller players to understand. |
| DB:
10:00
11:00 | Yeah, if you look at, say, the new business models for legal organisations, so those legal service providers that are maybe productising their knowledge or they’re not charging by the hour, they might be charging purely on value pricing. So, no time sheets at all. They could be fixing their fees, they could be running subscription model law firms. So, these are fundamentally different business models to the traditional hourly rate billing and a lot of legal technology, particularly practice management systems, are set up for the traditional hourly rate billing model of a law firm and I should say for a large firm to change their business model, that is just infinitely harder than a small firm or a brand new firm to flip their business model on its head and move to something like purely subscription model or purely value based pricing. So, new firms that are starting from scratch are able to look at the new business models, newer innovative business models, and then apply the technology to accelerate those business models. Creating legal products, for example, using workflow automation or expert systems where clients or users are able to be interviewed by some sort of questionnaire or a bot about their legal issue and be given a declarative answer or be given a document that’s largely complete in a far more cost effective and efficient way. So, that’s a business model that fits productising legal services, something that a NewLaw firm is able to adopt far more readily compared to a traditional large law firm that’s billing by the hour. |
| DT: | I guess the takeaway for some of our listeners who might be in smaller practices is that when we’re talking about legal technology in our interview today, we need to think about that as a means to an end and that end is an innovative business model rather than just the accretion of more tools to improve the margin on your traditional service delivery by half a percent. |
| DB:
12:00 | Yeah, indeed and you do find that tension between technology solutions that do speed up certain processes, so if a certain task takes X number of hours, X number of hours times an hourly rate, drives so much revenue for a traditional law firm, if you then take that same task, employ some technology that literally halves the time taken, well then what do we do with that saving? Do we just increase the margin, as you say, or do we charge a nominal fee for that process, or do you bundle it up into a subscription type of model because it’s just so much quicker and cheaper to do that particular task when you’ve got technology involved. |
| DT: | Yeah, it can almost be a driver to explore those new business models, can’t it? When the way you measure and collect revenue is incongruent with the tools that you now have. |
| DB: | Yeah, absolutely. I’m a little bit guilty of seeing certain tools come to market and think, “oh wow, I just feel like creating a product just so that I can use the tool,” which is not the correct way of thinking typically but I’m a little bit of a sucker for that. I do see certain technologies come to market and I just immediately see the product or service that I can offer around that technology and I just can’t imagine doing that where I’m stuck in an hourly rate environment. |
| DT: | Absolutely. Now, one of the technologies that’s been in the market for a long time and in fact you described using it even in your own experience in private practice, is automated document review. |
| DB: | Yes. |
| DT: 13:00 | What are some of the recent developments in automated document review because it has been around for a long time. I remember using Ringtail myself back when I was in private practice at a large law firm but what’s really at the cutting edge of that sector? |
| DB:
14:00 | Yeah. If I can cast automated document review into, I guess, two buckets, the first bucket being that maybe post signature area. So, if you’re looking at eDiscovery, so, documents that have been created already and need to be reviewed on mass from a litigation perspective with eDiscovery or in an M&A type of environment where you’re doing large scale document review for due diligence, that has been around for some number of years, that type of tech to automatically extract certain key data points from thousands and thousands of documents, for example. So, that has been around for quite some time and the ability for that artificial intelligence essentially to extract and identify key clauses in those processes has traditionally needed to have large amounts of training data in order to get accurate. So, I’m talking tens of thousands, if not hundreds of thousands of similar documents would need to be sourced in order to train… |
| DT: | Yeah. |
| DB: | … those data sets. The newer generation of AI is bringing that number of documents required to train way down. So, we’re no longer talking about thousands of documents. We’re talking about dozens… |
| DT: | Wow. |
| DB:
15:00
16:00
17:00
18:00 | … or even a handful of documents, a machine can upload and learn from and start to produce relatively accurate results with a far smaller amount of training documents and that’s leveling the playing field because, in the past, who had access to thousands and thousands of certain types of contracts, it’s only the large organisations that have that type of training data, whereas smaller firms, they might have a dozen or just a handful of documents and start to get meaningful results from AI. So, that’s one key development. The other key development is while we’ve got legal technology companies that have been building AI for several years now, newer players are able to take advantage of the likes of Microsoft and Google who have their own off the shelf cost effective AI solutions that you can tailor to the legal context. So, you can use Google’s AI product in your contract lifecycle management system, for example. Yes, it requires some tailoring to the legal context, but the core technology is developed by one of the world leaders in AI, and the same thing can apply to the Microsoft product as well. The next step beyond that is the legal technology artificial intelligence doc review solutions that have been in the market and tried and tested. One of those, so Kira Systems, was sold to Litera and out of that sale or prior to that sale was a company called Zuva, which is essentially taking the AI product and offering that to legal technology vendors such as CLMs for example and the benefit there is they’ve got tried and tested AI that’s already been trained on various types of contracts and documents within the legal context. So, as a legal tech vendor, you can use the AI that Google’s producing or you can use the AI that someone like Zuva is producing and it’s already got the legal context baked into the product and it’s really cost effective. So, any small law firm could afford the pricing that something like a Zuva is offering in the market. So, that’s only relatively recent in the last six months or so that’s happened and I’d say the final development, if we get into the pre-signature bucket. So, when you’re looking at essentially third party contracts coming across your desk, automated review of those contracts started out as being just flagging particular problematic provisions. So, using AI to flag problematic provisions, but it would then be the lawyer that would have to manually click the buttons or do the drafting to fix the clauses. That pre-signature AI is now moving to automatically marking up documents, based on your company or your firm’s playbook of preferred positions. So, the tech is now at the point where you can email a document straight into a system, it emails you back the same document within seconds automatically marked up for you. So, that’s, I think, very game changing. That is game changing. It is tech that is available to firms large and small. Yes, you’ll still need to tweak and play with those machine generated markups. The accuracy is not 100%. You probably can’t expect it to be 100% for quite some time, but the point is that AI and that technology is just getting better year after year and I can absolutely see a time where lower value, higher volume, standard form contracts will be mostly auto marked up by machines and sent out without too much human review. Maybe the odd spot check here and there but I think that’s very exciting in the pre-signature AI review space. |
| DT:
19:00 | Absolutely. Creates a whole new meaning to the term battle of the forms and I’m sure the contract academics will have some interesting cases once that becomes the norm in commercial practice. I want to go back to something you said earlier about the decision to use something that has that legal context baked in, to use your terminology, and something that a large non-legally specific vendor like Microsoft or Atlassian or Oracle might publish off the shelf. As the managing director of InCounsel, you’re giving advice to customers all the time on the kind of tools that will work for their in-house team or their practice. How should our listeners choose between a legal specific tool and a non-legal specific tool that might be published by a larger vendor. What are some of the situations where you think that legal context off the shelf is really important and less in others? |
| DB: | The legal specific tools ought to be a lot more off the shelf and require far less tailoring compared to taking Google’s off the shelf doc AI product. So, there should be a time saving. There ought to be more accuracy in a shorter matter of time using that legal specific product and cost effective as well. I don’t know the exact pricing comparisons between Microsoft, Google or something like Zuva but seeing Zuva’s pricing, it feels affordable from my perspective and the implementation should be simpler. So, I admit I’ve not used Zuva – we are testing it at the moment so give me a few months and we’ll probably be able to say how accurate the system is off the shelf with very little training. |
| DT:
20:00
21:00 | Amazing. That point about the training and validation sets being so much smaller now is interesting because this technology isn’t necessarily new in principle. I remember going to an AI in the law conference, maybe 7-8 years ago, and the discussion was really about which matters will this actually work for because there’s all this time up front in identifying the right training and validation set and spending the time teaching the machine before you can unleash it on the product set, if this isn’t getting too technical or beyond your area of expertise, what is the innovation that’s making it possible for these machine learning tools to accurately identify things like change of control clauses and ipso facto clauses with smaller training sets that is ultimately making that sort of tool more available to smaller teams. TIP: David has just asked a bit of a technical question here that we should break down. Artificial intelligence as it stands is not a uniquely creative machine able to reason in the absence of relevant datasets. Conceptually, it might be easier to think of these kinds of tools and what they do as “machine learning” rather than intelligence. Machine learning takes in data, assesses it according to the machine’s algorithm, and gives you a result. Machine learning has improved massively as processing power has increased. Which means, the learning machines can themselves be more complex, consequently, the time needed to train and validate the machine on new data has reduced. So in the cases David has just mentioned, change of control and ipso facto clauses – fewer examples of those clauses are needed to accurately train the machine to spot them, meaning the players who can access this technology can be smaller and less well resourced. |
| DB:
22:00 | I don’t profess to understand how the tech works for AI. I don’t know what the leap in AI technology or research is responsible for shorter or smaller training sets and shorter timeframes, but broadly speaking, I just know that’s what’s happening in it and I’ve seen examples of it as well where in a relatively small number of documents, you’re able to far more quickly get more accurate results but I can’t exactly explain how the AI has evolved and changed under the hood. |
| DT: | That kind of advanced tech, just indistinguishable from magic, right? It just works. |
| DB: | Yeah. |
| DT: | Now, we mentioned at the top of the episode that legal tech is not just an enabler for working more efficiently and delivering results for clients more efficiently. It can be a solution for hiring and retention which is a perennial problem for the industry. I think we have stats from the ALPMA, the ALPMA or Australian Legal Practice Management Association that 2/3 of firms say they struggle to retain staff. What legal tech solutions have you seen around people management that can help firms to find the right people and keep them? |
| DB:
23:00
24:00
25:00 | Yeah, the churn question, I don’t really associate it too much with legal tech, to be honest. I think technology is sitting way down the list in terms of the problems that are causing lawyers to churn out of law firms. I haven’t seen too much innovation in technology specifically to hire new lawyers or retain new lawyers. I guess there’s more generic tooling that’s out there that is able to take the pulse of organisations and staff and provide staff with feedback channels, that type of thing. Probably the one thing I would say is, I guess more the collaborative technology tools that are out there, being able to access your law firm essentially from a browser and allowing lawyers to work from wherever they like, remote working, flexible working, technology is a huge enabler of that and I think we’ve proven over the last couple of years how well lawyers can work and how productive they can be working from anywhere, not necessarily in the office and so I think a certain portion of lawyers do churn out at law firms because of lack of flexibility, the inability or price stigma to working from home, essentially, that I think has greatly been reduced and I think it’s the right time for technology to solve that problem. TIP: According to the 2022 Tech & the Law published by Thomson Reuters, the third largest focus in 2023 for private practice firms is attracting, retaining or upskilling talent, with just under half expressing their desire to do so (45%). The issue is slightly less prominent in corporate counsel teams as only 28% said that it was one of the biggest challenges facing their legal department. There are, as David Bushy just mentioned, more generic tools which can be applied to this issue. One such example goes back to our guest in Episode 66, Alex Gyani. An offshoot Alex’s organisation, The Behavioural Insights Team, developed a product with the intention of using behavioural economics to find and hire the right candidates. That technology is called Applied. The idea is that it is a science-based approach to hiring the best candidate which removes some of the unconscious biases in the hiring process. Definitely check out Alex’s episode if you’re keen to hear more about the use of behavioural economics in the legal system. |
| DT:
| Sort of related to that, I don’t want to sound like a dog with a bone with this, but I had an interesting conversation with Demetrio Zema, the founder of Law Squared a couple of weeks ago and Law Squared’s focus is really on changing the experience for the lawyers that work at the firm and the business model of the firm – it’s one of those firms that doesn’t use hourly rates, there is no time charging, it’s all value based pricing – is really core to changing the experience for the lawyers that work there. I think legal tech’s role in improving hiring and retention is really in enabling those business models that we were talking about earlier that are attractive to young lawyers. They’re attractive to lawyers of any age and stripe, I suppose, who want to work in an innovative business, who want to work in a business that’s built to facilitate or at least be consistent with the kind of work life balance they want and that includes things like working from home. |
| DB: 26:00 | Yeah, absolutely and those NewLaw firms, Demetrio and Law Squared are a great example of that and I’d still say first and foremost it’s a different business model that is separating them from traditional law firms, a different way of thinking about law firms, a different business model, but in terms of the technology, they have had to customise a lot of their own technology stack because a lot of it does not exist serve us yet. So, traditional legal software is not necessarily that suited to law firms like Law Squared. Other law firms like Sprintlaw here in Sydney just to name a couple that I know are not really leveraging the traditional legal software that’s out there because it’s just not built yet for the new business model, NewLaw firms that are there and I think the attraction of working for those NewLaw firms is more of a business model difference as opposed to a technology difference. |
| DT: | Yeah, absolutely. |
| DB: | The technology is definitely enabling that new business model but at the end of the day it’s a law firm without time sheets and that has its benefits for a lot of people. |
| DT: 27:00 | Yeah, absolutely and we see that with such a proliferation of practice management systems, both Australian made and from overseas but so many are really still built around measuring utilisation, measuring revenue, recording revenue through time sheets. |
| DB: | Absolutely. |
| DT: | That is still the most common functionality of those systems? |
| DB: | Yes. Yeah, it’s a big common functionality of those systems. I certainly know of some law firms that operate without timesheets, but they still use a traditional practice management software but there’s 30% of that software that they literally do not use or do not open at all or law firms that do not operate with any type of trust account, for example. So, it really opens the door to using different types of technologies if you’re running a different operating model to what we’re used to. |
| DT: 28:00 | I’m going to come back to this idea of needing to customise some of these solutions a little bit later because I want to talk about the kind of capabilities that even small practices might need internally to do that but first I wanted to ask you a little bit about your work in InCounsel. |
| DB: | Yep. |
| DT: | As we said at the top of the episode, you provide legal engineering services to organisations, both law firms as well as organisations with in-house teams to help them to adopt the right legal technologies for their business. What are some of the most common problems you see that your team’s called in to solve? |
| DB: | For the in-house legal teams, I’d say contracts and, in particular, CLM, contract lifecycle management, would be the number one area of inquiry. If you think there’s been a proliferation of practice management systems for law firms – well, you should see the proliferation of CLMs for corporate legal teams… |
| DT: | Can only imagine… |
| DB:
29:00 | … it is easily the hottest area of legal tech right now and it’s attracted enormous amounts of funding. So, it is very difficult for someone to do a market scan, like where do you start when there’s just hundreds of vendors out there? So, we do quite a lot of work in upfront work – we’ve looked at a lot of the CLMs in-market over the years and been tracking them loosely. We’ve done lots of sandboxes and trials of those products so we can help expedite, get a head start on the selection process. Implementation though is the really big piece. It’s the much, much harder piece of the equation. Signing the dotted line, licensing a product. It’s getting your internal users, both the legal team and the business to adopt the product. That’s the bigger challenge, which we spend a lot of time on in project managing that change. For law firms, again, it’s contracts. It centers around contracts and in particular for law firms, it would be, probably, document automation. So, that’s where we probably do the bulk of our work, is helping either internal lawyers fill in some sort of form or use the data out of a practice management system to automate a document in a complex way. So, not just filling in the party names and basic details but using conditionality. |
| DT: | Yeah. |
| DB: 30:00 | So, if this circumstance is here, well, then we need to draft this clause in. So, that more complex document automation is where we do a lot of our work for law firms and then beyond that there’s the document automation, but then there’s the workflow automation. So, great, you’ve drafted the first cut of an employment contract. Now what? Does it automatically file into SharePoint or a document management system? Does it automatically create a whole bunch of tasks in your project management or matter management software? So, it’s those extra pieces of the workflow chain, which can be automated. So, we do a lot of work integrating the different systems that a law firm has. So, whether it’s integrating with SharePoint, which is integrating with the practice management system, which is integrating with various other tools. So, in one workflow we might work with five or six different separate platforms and make those platforms talk to each other essentially. |
| DT: 31:00 | Yeah, certainly in both our boutique law firm, Assured, and in our legal innovation business, Lext, I think every small business or new business finds that they’re not using a single monolithic system to run their business, but they’re often using a variety of services that are integrating with one another. |
| DB:
32:00 | Absolutely and, look, I’ve got a strong view on that because a lot of people are looking for the one platform to rule them all. They don’t want to be flipping between different softwares, flipping between different browser tabs. I think we’re going to have to live with that because the best of breed tools are typically built as point solutions. They do one thing really well, like that’s going to be the best of breed tool. So, if you want the best of breed document automation software? Yes, contract lifecycle management systems, practice management systems have some level of document automation, but their product is so much bigger than document automation. There’s a lot to work on in those larger systems. So, the best document automation system is probably the point solution document automation system. The best document management system or email filing system, again, it might be a point solution that does it best. So, time and time again, I’ve looked at systems that profess to do essentially 90% of the tasks and they do, it’s just they do them not so well compared to these point solutions. So, that’s why I think the integrations piece is so important because then you can start to work with the best of breed. It might be an intake or a chatbot or the best of breed CRM or the best of breed email marketing software and all of those modern systems will have APIs that let you integrate and talk to other systems and I think that’s where the real magic happens when you’re using amazing tools. Yes, you’re switching context but they’re producing the very best results as opposed to one large system that does everything mediocre. |
| DT: 33:00 | Yeah, absolutely and I think apart from that kind of software development paradigm, moving towards that more specific use case point solution, as you described it, more and more the pain points associated with having all of those different products are being removed, aren’t they? OAuth login, APIs and better API documentation… |
| DB: | Yeah. |
| DT: | … infrastructure platforms as a service. All of these tools make it easier for your whole tech stack to talk to other items in your tech stack and, a little bit of a plug for InCounsel, some good consulting advice can help you make the best use of some of those meta tools. |
| DB:
34:00 | Yeah, definitely. You definitely see some vendors that very much set out to work with other tools from the get go. So, they would like you to spend a lot of time in their platform, but they realise that people are spending a lot of time in Outlook or a lot of time in Microsoft Teams or a lot of time in Slack. That’s where they live. So, instead of producing the chat or video conferencing tool within their own stack, they’ll just work with Microsoft Teams, make sure that integrates seamlessly into their own platform. So, I really like that approach actually and not trying to grab 100% of everyone’s attention and put them into your platform but just spread the love across various platforms. Just make sure you play nicely with others. |
| DT: | Yeah, absolutely and we see that with a number of the well-known legal tech vendors. I think I saw something from Immediation and Josef about integrations with DocuSign and Annature and some of the tools that were complimentary there rather than trying to capture all of that related service. |
| DB:
35:00 | Yeah, Josef’s a great example of a good point solution that does one thing really well at the moment. So, document automation, workflow automation, great ease of use, designed to create questionnaires or chat bots that are user friendly to end users and easy for the average lawyers to build quite complex workflows from. That in itself is highly valuable and then, there will be the APIs that feed into a product like that and then the API that will take the data that something like Josef produces and pushes it elsewhere. So, good example of a great market leading point solution. |
| DT: | Now, before we talk about implementation and adoption, which is absolutely the hardest part of that innovation or change journey, I want to ask you one more question about selecting a tool without giving away the secret sauce of your consulting business, obviously. If there were three things that our listeners should be looking for when they’re trying to decide on the right tool for their business, whether it’s a practice management system or a document automation system or a document review system. What are kind of the most important factors for you in making a decision? |
| DB:
36:00
37:00
38:00 | User experience would be number one. The ease of use of a product. In the newsletter I pushed out yesterday for InCounsel, actually, the quote of the week was something like all the change management in the world won’t make up for a poor user experience. Words to that effect and that’s true. You might have a product that has all the power in the world and every feature under the sun, but if it’s just difficult to use, it makes it difficult to adopt and if you failed an adoption, well, then you’ve really failed on implementation. TIP: According to that same Thomson Reuters survey, almost half (48%) of private practice firms said they had faced challenges with legal tech because it was “slow, cumbersome or hard to use”. Difficulty in using the technology is the most common challenge with implementing newer technologies. Lack of integration between technology platforms was also considered one of the main challenges by 39% of private practice respondents. Similarly, 45% of corporate counsel reported the issue of technology being difficult to use, with an equal 45% also reporting lack of integration as one of the main challenges. So, whenever I get a trial account or a sandbox, and I always get that I do not rely on demos from vendors. That’s probably my number one tip to anyone looking at legal technology or any technology is get your hands dirty, insist on a trial, get a sandbox and use something before you commit thousands of dollars and, more importantly, a lot of time and effort and data going into a platform when you implement. So, make sure you use something and make sure you can get to that aha moment where you suddenly realise, “hey, I can work this. I can create a matter easy. Hey, I can create my first workflow pretty easily. This is intuitive. I don’t have to ask for support too often. I don’t have to hit the support pages too often. This is really intuitive to use.” I think that’s the number one thing and it is a very hard problem to solve, for vendors to get that right it is exceptionally hard but I think we should expect tools that are as easy to use and adopt as Facebook, Instagram, all these consumer products that we intuitively know how to use, there’s no user manual that comes with these apps on our phones. They rely on user experience and we’ve still got a long way to catch up to get to that point but some tools are coming to market that I think are a bit more like the iPhone type of experience where you jump in and start on a product and get to that aha moment pretty quick. |
| DT:
39:00 | Absolutely. One tool that comes to mind for me when you describe how legal technology tools should resemble the kind of consumer web applications that we are using outside of work is Josef. I often think of that nice, lilac user interface. It does look like a consumer facing application. It doesn’t look like business technology and it is easy to just pick up and use and I know that for our own part at Lext we try to do the same thing with our web applications. We try to use that sort of material design framework that most consumers are comfortable within their personal lives for their legal technology. It reminds me of a story from my own time in practice and this was years and years ago so it wasn’t a web application, it was a locally installed application, but we were encouraged by both our firm, our client to use a particular tool that was both matter management and document automation. It was for managing a particular litigation workflow and you’d enter the details of the matter and it would produce for you a statement of claim and then you could update what happened with the statement of claim and it would produce a notice of motion for default judgment and then you could say what happened with the notice of motion for default judgment. It would produce for you a writ. Very feature rich and great in principle, but it was so unpleasant to have to enter all of the information again into that system that you had just entered in an email report to a client or into the matter management system that it just sat there unused and everyone preferred to create these documents manually rather than using great features that someone had spent a lot of time building… |
| DB: | Yeah. |
| DT: | … because it was such a difficult tool to use without a lot of training and also because there was some duplication of that kind of data entry. |
| DB: 40:00
41:00
52:00 | Yeah. No one likes data entry and that’s a really big problem particularly for any practice or matter management system or even document automation. If there’s a lot of data entry, people just don’t want to do it. They don’t do it. Only the most disciplined people in your organisation will enter the data correctly and you see this outside of legal tech, you see this in CRMs for sales teams. I’ve done a lot of sales and BD in my time and even as a business owner, I neglect to put the data in sometimes to these CRM systems because I don’t like data entry either but those CRMs have sort of led the field in making it really easy to avoid the data entry, to automatically pull in prospect details, emails, that sort of thing, into your CRM without clicking a single button and some legal technology tools are starting to learn from other verticals to make it less data entry intense and the other thing I might mention around just consumer tech and how easy it is to use consumer tech, I really like some legal tech companies that start off targeting the B to C market and when they target the B to C market, they’ve got a different hat on. They’re going, “okay, we need to make this really simple for your regular consumer to use first, not for lawyers, but for a off the street consumer.” So, they do a really marvelous job of creating a simplified user interface aimed at the consumer and then I start to see them go up the tree into enterprise because they’re going, “hold on. These enterprise users, they’re consumers as well. They’re lawyers, sitting behind desks and they’re consumers as well” and they appreciate just as much the ease of use that these consumer focused legal applications have. So, there are a number of, I guess, kind of contract management document automation type, consumer based products that are out there that I can see real potential moving up the tree into enterprise. They just need to add a few more features and hopefully not screw up the user interface but the simplicity has a lot of appeal in enterprise as well and I think they have a real opportunity to make an impact in the enterprise space if they’ve got the design aesthetic that’s suited to consumers from the start. |
| DT: | Yeah, absolutely and did Einstein say? “As simple as possible, but no simpler than that,” right? There’s always that balance between making sure that the features are there and that people are aware of them and using them in that simple user interface. |
| DB: | Yeah. |
| DT:
43:00 | Let’s talk about implementation now because it is the more challenging aspect of adopting a new technology in the legal field or otherwise. I think Harvard Business Review reports that the majority of change initiatives fail by the assessment of their own sponsors anyway and one specific implementation challenge is adoption by users. I think we can always rely on the people who are close to the decision, being very enthusiastic about it. There’s a big launch party, maybe if it’s a particularly important change, if it’s one that’s driving a business model change, for example but if the people at the coal face don’t want to use the tool, then it’s money wasted and an opportunity forgone. So, how does your team at InCounsel get users at the coal face to use new technologies? |
| DB:
44:00
45:00 | It’s a big question. So, hopefully we’ve picked a product that provides a good user experience and solves a real problem and is just a better solution that was previously there or maybe there was no solution in the past. So, hopefully you’ve got those basics down pat because, like I said, if you’re implementing a product that is difficult to use or is not solving the problem properly. No matter how good the launch party, no matter how good the change management and no matter how good the comms strategy and support will be if at the end of the day the product’s not right or not solving the problem the implementation, I can’t see it succeeding. So, assuming you’ve got the right product, a good product in play, I think communication is probably the key. Both pre-launch and post communication. Nothing’s ever set and forget. So, after the launch, the hard yards begin. Having those dedicated resources to answer questions, to schedule the regular check-ins with your users, being available for that first 6 to 12 months of really heavy lifting trying to get to that tipping point where enough users in the organisation are using the products where they start to just assist their peers, essentially. You’re just using the team members to assist their own peers where they don’t have to keep coming back to yourself as the project manager or the leader on the project for that ongoing support. It starts to have a rollout effect or a network effect across the organisation but I think, yeah each organisation is going to be a bit different. Each organisation has different resources within a business to champion or to be involved in a process. So far we’ve taken everything on a case by case basis. We’ve done quite a large implementation across a global team of users, so various business units. This was sponsored by the in-house legal team for a CLM, but it was very much the business users that were mostly involved in the contracting process and I think that the type of organisation was a fairly standard user, they weren’t particularly tech savvy, they weren’t particularly tech averse is how I’d characterised them. We had some people that were very enthusiastic and then other people that were not really interested in adopting anything new and the cultural differences really made a big difference. So, certain parts of the world. |
| DT: | Yeah. Right. |
| DB: | It’s different training groups of people in certain countries, particularly online over Zoom, where they don’t interact, just culturally, they don’t interact so much, don’t ask many questions versus other jurisdictions, such as the sales team in the US for example, that will ask a lot of questions, will interject and really get engaged. |
| DT: | Yeah. |
| DB: 46:00
47:00 | So, there’s so many differences across a large organisation that’s geographically spread but we also did a really in depth implementation with a lot of work with a small firm in the US. Had a lot of engagement with the principal of the law firm, but sometimes it was hard. We would discover later that some of the information that we’re providing to the principal of the law firm wasn’t necessarily filtering down to some of the junior lawyers and paralegals in the team. So, that was something that we had to learn by doing, realise that the information, the way we communicated information was just essentially siloed with one person. So, we started to involve the junior members of the team and then the current implementation that we are doing is for a technology company in Australia. Again, an in-house legal team and I think because they are a startup or a scale up, a lot of the staff themselves are just a bit more tech forward and tech leaning. So, the adoption feels like it’s been an easier path and in the user testing it was just a different experience where I’ve got the user on the other side going “yep. I know” and I felt like I was teaching them to suck eggs a little bit going, “no, you need to click here and click there” and they’re like, “no, I get it. I can understand this. It’s all very intuitive.” So, it will really depend on the characterisation of the organisation you’re looking to implement technology in. |
| DT: | One of the things we’re discussing today is that legal technology can be an enabler for smaller businesses to compete, or at least keep pace with their larger counterparts. When you’re implementing a new technology for a smaller business that maybe doesn’t have the resources to run a training session every hour for a week or have that dedicated resource available to answer questions about the tool, what kind of compromises can you make to ensure that you get as much adoption as possible? |
| DB:
48:00
49:00 | I haven’t found too much difference between large and small. We’ve had smaller clients where we’ve found adoption to be surprisingly difficult. Where the supposed sponsor who’s looking to drive this change in a small organisation they sometimes get wiped out by a large matter and we don’t hear from them for weeks on end because they’re dealing with some fire they’re trying to put out. So, we do get that with smaller organisations, things can be put on ice for longer periods. So, you do feel like well, it’s a small organisation, small law firm. It only takes a few people to adopt and hey, we’re away to the races but when you’re lacking someone who’s dedicated to project manage that on the client side it can really hold you up. The legal work that comes in can hold you up. That goes for in-house legal teams. That goes for private practice law firms. Whereas in that larger organisation you typically are able to tap someone on the shoulder internally to sort of dedicate part of their time or all of their time even to helping to implement or champion the implementation process and yes, they’ve got a bigger job to communicate that to a larger organisation, but if they’re a bit more dedicated to it you can make a lot happen. So far, we’ve seen the challenges of a large scale implementation and also the challenges of a small scale implementation where the resources are just really tight and subject to legal work getting in the way. |
| DT: | It sounds like even in that small organisation, you do need the dedicated resource. You do need to spend and devote time to getting the implementation right, even though in the short term it might cost you a little bit in terms of the time that you might otherwise be spending on client work. |
| DB: | Yeah, that’s right. You really do need to resource that internally properly over a sustained period of time. We’re not talking weeks, we’re talking months to really get full adoption on things. Yes, we sometimes step in for the client side to project manage or program manage a change. So, we act for the client as that dedicated resource working in with the vendor but even so ourselves as the client’s kind of project manager, we also need someone who can sign off on what we’re doing and again if that sponsor internally is able to get wiped out by legal work or a large transaction or matter etc. then it does put the brakes on things. |
| DT: 50:00 | That brings me to a question, as we said earlier in the episode, large law firms have had legal technology managers, innovation managers, engineers, technicians in-house for some time. Is the size and scale of the law firm that needs those in-house capabilities shrinking? Should smaller firms have those technology specialists in-house? |
| DB:
51:00 | Yes. Yes. I think it is shrinking. If we talk about Law Squared as an example, we raised them before that, they have, I don’t know the exact title, but a head of innovation equivalent who has a team. So, it’s not just one person in a relatively small law firm. They’ve got an outsized innovation team. There are other smaller firms or NewLaw firms as well that I feel like they’ve got those roles and responsibilities in place far earlier than say the larger law firms have had. So, I think the larger law firms were first movers in it. Then you’ve got the NewLaw players that have come into market that are a bit more tech led. Being tech led, they start to invest in those roles and resources earlier but then you’ve probably got maybe the large middle layer that does not have that sort of bandwidth or capability or incentive to invest in those innovation roles as much as the large law firms or the smaller NewLaw players. |
| DT: | So, we’ve talked about a whole range of different tools today. We’ve talked about practice management systems, document automation, document review. If one of our listeners is thinking, “okay, I’m convinced I do need some better legal technology tools in my practice but I don’t have any of that internal capability. I don’t really have much in the way of tools that I’ve already adopted. This tech stack of all these different tools that integrate with one another that you’re talking about. I don’t have that.” Where does that practitioner start in modernising their practice and adopting legal technology? |
| DB: 52:00
52:00
53:00
54:00 | I imagine most practices do have a bunch of tools under their belt that they don’t realise they have. Pretty much all lawyers are using Microsoft Word and by extension a lot of the law firms will probably have Microsoft 365 as the backbone tech platform. So, obviously that’s Word, that’s Excel, that’s Outlook. It takes some time to look at the other offerings under the standard Microsoft license and that opens up the Microsoft Booking app. So, allowing clients to just book you online, integrate it with your calendar just by sending them a link, just saves the back and forth of scheduling. You’ve got Microsoft Forms, which you can use for any type of client intake or even document automation and all of these are just included in the standard Microsoft license. SharePoint also springs to mind that a lot of lawyers have probably not really looked at so much. So again, if you need something for document management intranets even for an online data room, so there’s a lot of capability in SharePoint and then if you’re really adventurous, there’s the Power Automate platform within Microsoft, again, coming for no extra cost with the Microsoft license and that’s what gives you a whole bunch of automation fire power. So, that lets you connect up your various Outlook calendar invites to trigger emails, to trigger documents, to go into SharePoint etc. TIP: Most law firms already use the Microsoft Office suite, however, there are some valuable applications that go unnoticed. One of these lesser known applications included in the suite is Exchange Online. Exchange Online provides various different features including the ability to use role-based email addresses that act as a shared mailbox – which can then be accessed by multiple people within the firm. This is valuable for billing or generic enquiries. It also has shared calendars integrated, which can be accessed on your mobile. Finally, it also provides additional email functionality beyond what is available through Outlook. This includes the ability to set up a rule that sends you notifications of emails being sent out even if you’re not CC’d on that email. So, there’s a lot you can do just with the Microsoft stack alone and then from there, if you’ve got particular pain points and it’s something that, Microsoft can’t solve for very well, then you can start to look at the directories or getting educated, going to various websites or publishers of legal innovation content, technology tool directories etc. There’s a lot you can do, I think just with the Microsoft stack and using what you’ve got and the same thing can be said for in-house legal teams as well. If their organisation is already running on Salesforce, for example or if they’re already running on Jira there’s a lot you can do. Just applying those tools to the legal context. |
| DT:
55:00 | That’s a great point. It’s kind of the reverse of something we were talking about earlier, that often tools that are really feature rich but don’t display those features in the right way, go unused. A lot of our listeners probably have all these tools at their disposal that they don’t realise they already have. I know so many practice management systems now have some degree of document automation associated with the matter metadata… |
| DB: | Yes. |
| DT: | … to at least insert things like client names or matter names and other custom fields that come with those matters. So, a lot of listeners probably already have that through their practice management system too. |
| DB: | Yeah, that’s right and a lot of it’s probably going unused. So, it does take time to set up those automations within a practice management system. There are probably integrations that the practice management system has with say, your accounting software that again, you might not have explored or you might not even realise that that system has that. So, feel free to engage with the vendor of the systems that you have and ask them the question around the tooling that may exist already in the platform, or if not, they might recommend. |
| DT: 56:00 | Now, we’re nearly out of time but David, as the publisher of the Law Hacker’s Newsletter, you’ve seen literally thousands of legal tech tools, some very mainstream and some sort of more for the edge cases. What’s one tool you’ve seen that’s just so cool everyone should have it? |
| DB:
57:00 | Oh, I think it’s an impossible question to answer. It’s a hard one to pick a winner out of all the tools. I’ll try and use a little bit of data on this. Each year, I’ve tended to put out a newsletter where I go back and look at the click throughs on all the newsletters each week and just see which of the tools have had the most clicks, factoring for the number of people that opened the newsletter etc. and year in, year out, the tools that tend to get the most interest are around tools that solve contracting problems, particularly drafting type of tools. So, whether you’re a deal jockey or a litigator, we’re drafting documents all the time. It’s just our tool of trade. So, tools that can optimise that process whether that be quality control type tools that find all the errors in your drafting, the cross-reference errors or grammatical errors etc. No matter how much we proofread a document, those tools tend to pick up stuff that you go, “hold on. How did I miss that cross reference?“ |
| DT: | Stabs you in the heart every time you see that “error reference source not found,” doesn’t it? |
| DB:
57:00 | Yeah. Yeah. Those quality control tools, I think are a no-brainer and they are often integrated directly into Microsoft Word. So, you don’t really need to leave your Word environment to access this tooling and not only is it correcting errors, it’s I think augmenting your drafting, having your clause banks, preferred positions, playbooks etc. again, just sitting in that side panel in Microsoft Word so that it can augment your drafting experience, expedite it and ultimately become a better drafter and in some cases a great learning tool for junior lawyers, where they’ve got some technology that’s helping them draft documents better. |
| DT: | Fantastic. For any of our listeners who want to keep up to date on legal technology developments, they can always subscribe to Law Hackers… |
| DB: | Absolutely. Yeah. |
| DT: | … on the InCounsel website. |
| DB: 58:00 | Yep. If you just want the tech and the bright shining toys, then there’s four per month that come out through lawhackers.com. I’d also recommend the College of Law Center for Legal Innovation here in Australia. Amazing resource of long form evergreen content across all walks of legal innovation, design, technology, you name it. It’s a great resource and then for just technology, innovation news, Artificial Lawyer run out of the UK, albeit with a very global readership is just great for all the latest and greatest in legal technology news. |
| DT: | Fantastic. Great tips. David, thanks so much for joining me today on Hearsay. |
| DB: | Yeah, thanks David. It’s been a pleasure. |
| Ross Davis:
59:00 | You’ve been listening to another episode of Hearsay the Legal Podcast. I’d like to thank our guest today, David Bushby, the managing director of InCounsel, for coming on the show. If you enjoyed today’s episode of Hearsay and are intrigued by this ‘LawSquared’ we keep mentioning, make sure to check out an episode we released a few weeks ago with Demetrio Zema, who founded LawSquared. He takes us through the ways his law firm has implemented legal technology to their advantage as well. If you’re an Australian legal practitioner, you can claim one Continuing Professional Development point for listening to this episode. Whether an activity entitles you to claim a CPD unit is, as you know, self assessed, but we suggest this episode entitles you to claim a professional skills point. More information on claiming and tracking your points on Hearsay can be found on our website. Hearsay the Legal Podcast is brought to you by Lext Australia, a legal innovation company that’s out to change how you experience the law and legal services, including CPD. Now before we go, I’d like to ask you a favour, listeners, if you like Hearsay, please leave us a Google review. It helps other listeners find us and that keeps us creating the content you love. Thanks for listening and we’ll see you on the next episode of Hearsay. |
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