It’s no exaggeration to say that the coronavirus pandemic has affected every single person and business around the world, forcing many of us to rethink what we know about how we work and the tools we need to do it – and legal tech is no exception.
The industry was already experiencing increased adoption and momentum, but the pandemic has forced both law firms and corporate legal departments to do more with less and modernize at an accelerated rate.
Here’s a look at some of the top trends we expect to see in 2021:
1. Remote Technology & The Talent Wars
For many, COVID-19 accelerated — and sometimes forced — the adoption of new technology in an effort to keep operations afloat. Businesses will continue to look to legal tech solutions to facilitate collaboration, eliminate man hours spent on menial tasks, measure performance of service providers, manage budgets, and more.
The normalization of remote work has also opened the doors to a broader talent pool. Businesses are no longer restricted to just the candidates in their geographic area. They are now free to pursue the best talent – but so is everyone else, resulting in some serious talent wars.
While we do believe physical offices will make a comeback, we foresee many businesses adopting a more hybrid approach that allows them to suit up and battle it out for the top talent.
2. Artificial Intelligence
As legal tech looks to service more corporate legal departments to transform the tedious, manual tasks that typically waste precious time and resources, AI will become increasingly understood and less stigmatized.
Legal departments will leverage AI to deliver real-time insights, making them more efficient and effective. As we like to say at Bodhala — AI will help ‘let lawyers be lawyers!’
AI is turbocharging the legal industry and as we continue operating in a remote environment for the foreseeable future, expect to see more corporate legal departments adopt legal spend management tools, eDiscovery, contract management, and other legal tech solutions to drive their strategic initiatives,
3. Increased Focus on Data & Analytics
Data has long been the driving force of the strategic decisions in most businesses – from media to manufacturing and everything in between. It probably comes as no surprise, but legal has been a late adopter of data and analytics. But renewed focus on ‘the business of legal’ has forced a data reckoning, with both firms and corporate legal departments taking new interest in how they can leverage data to improve strategic decisions and business processes.
In-house teams are also now demanding increased transparency from their outside counsel on everything from rates to the diversity of the timekeepers staffing their matters. This demand is driving a need for real-time data and reporting as well.
With cost optimization and diversity efforts assumed to be at the forefront of many corporate legal departments’ 2021 priorities, legal spend management solutions and data visualization tools will become even more prominent in the marketplace.
4. Cross-Functional Collaboration
Legal departments have often had reputations for being a bottleneck when it comes to decision-making. But organizations are increasingly looking for solutions that support collaboration with legal departments to speed up, not slow down, their decision-making processes.
In 2021, legal tech won’t just serve the legal department. It will play an integral role in cross-functional collaboration, consolidating pertinent information into one place and streamlining workflows.
- Finance departments may leverage legal spend management solutions and eBillers to optimize their workflows, consolidate invoices, obtain data-backed insights to support budgeting/forecasting, optimize spend, or report on the health of their bottom line.
- Sales teams will continue to benefit from legal tech tools that decrease sales cycles and simplify the process for prospects, like contract management and e-signature solutions.
- Legal procurement teams will expand their use of data from legal spend management solutions to improve strategic spending decisions and firm selection processes.
5. Continued Disintermediation of Legal Services
As organizations look to become more spend-savvy, disintermediation continues to be a common trend.
Prompted by the high rates charged by law firms even for mundane tasks or simple matters, many in-house teams are embracing a more economic and efficient solution — Alternative Legal Service Providers, or ‘ALSPs’.
Lawyers will leverage technology to not only identify target task and matter types, but to also recommend categories that could be outsourced to ALSPs and the projected savings opportunity.
Thanks to AI, machine learning, and a continued focus on cost optimization and efficiency, we expect ALSP adoption to hockey stick in the next few years.
6. Increased Investment, Acquisitions & Partnerships
The legal services market is a half-a-trillion dollar global industry, and like any massive market opportunity, it’s being disrupted – for the better! The opportunities to service the industry are massive – and innovation is really picking up. And along with innovation comes investment.
2020, despite all it’s challenges, saw a huge uptick in legal tech investment – from venture capital funding to large scale acquisitions. Growth is also being driven by partnership – both technology partnerships as well as channel partnerships are on the rise. Case in point – Bodhala. In 2020 we closed our $10M A Round in March, and announced our first major partnership with Mitratech in November.
As products and revenue accelerate growth, we anticipate interest from the investment community to continue to grow — undoubtedly making 2021 increasingly exciting!
Though we hope that our world can slowly begin to return to normal in 2021, the events of 2020 have certainly proven the long-term value legal tech solutions can provide.
It’s more than likely we’ll see the newly adopted practices and technologies adopted in 2020 remain in place for years to come as the legal industry has slowly unearthed the benefits technology and innovation present.
Get in touch with our team of legal billing and data experts to find out how Bodhala can transform your legal department.