The Business of Law: Powered by Legal Innovation & Technology?

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My early morning walks to Central Park with my Brittany Spaniel, Scout, are my NYC discovery moments: new restaurants, closed stores, new advertisements in bus shelters, and more.

It is a time when my brain is fairly clear, and my power of observation is sharper. So, it came as no surprise, when I noticed a truck delivering supplies to the ABC Network building. The tagline on the side of the truck seemed to scream to me — “Metropolitan Coffee House, Where Innovation and Technology Meet Pantry Services” It’s not enough that it seems my every work moment contains some reference to “Innovation”, now, my most treasured time of the day has been invaded as well.

What Is the Idea of Innovation?

I made a mental note of the website and checked it out when I got home; it is, indeed, a food service company. The tagline on the website is “Group C: Driven by Wireless Technology.” Without looking too deeply, I imagined this meant that companies no longer had to call their sales representative for coffee refills. Miraculously, Group C somehow knows when you are out of napkins, stirrers, and snacks and a little wireless device notifies them to speedily deliver replacements.

Those of us in technology, would make that assumption. I think.

Remarkably, when you go on their website and click on Vending Services, Pantry Services, or Coffee Services and scroll down the various pages, there is no mention of technology you’d consider “innovative” or unexpected. They do boast having LED lights in their vending machines. And providing real-time inventory reporting. But in fact, their technology was on par with those offered by similar services I found online. What happened to the Innovation and Technology promised on the side of the truck? And what impact can either innovation or technology have on the food pantry business? Or is this, too, hype?

It will come as no surprise to any of you who know me that I believe the same questions can be applied to the legal profession. What exactly is this idea of innovation that everyone talks about and that has spawned a new cottage industry of conferences and publications and larger turf for consultants? Is it a new concept?[1] What is the promise? Can it really impact the legal profession? And if, in fact, it can be so impactful, why is it seemingly difficult — or even impossible — to define and implement? Should law firms include in their logos some reference to innovation and/or technology: “Dewey, Cheatem: Powered by Digital Technology?”

What Type of Innovation Do Lawyers Envision?

The only survey about innovation in the legal sector — recently conducted by Ron Friedmann (Prism Legal) and Jean O’Grady (DLA Piper), among others — asked individuals in law firms and in-house legal departments to describe the types of innovation they would like to introduce (or are working on), and the obstacles preventing them from achieving success. The survey is important precisely because the results were not a bit surprising and serves to counter so much of the hype surrounding innovation. Here are a few findings:

  • In many cases innovations are not being implemented in law firms either because of a lack of funding or available staffing (both of which must indicate either lack of interest or lack of belief in value) or because of “difficulty in adoption,” which presumably means cultural issues stand in the way of getting people to see or do things differently. Just as the interest in “innovating” isn’t new, neither are the obstacles confronted by those attempting to implement.
  • A bit over half the law firm respondents have a “formal” innovation program. “Formal” seems to mean different things to different firms: Chief Innovation Officers, committees, Shark Tanks, labs, etc. It isn’t clear from the study whether there is any connection between success and having a formal program.
  • A free text question asking for innovation “wishes” yielded at least one response of “eliminating email” which hopefully didn’t mean substituting some other system, such as Slack, for traditional email. Just to say it, while roundly wished, eliminating email today is as likely as eliminating voicemail was 20 years ago. That being said, the number of voicemails we receive today is vastly reduced, so who knows?

As in any business, the legal world benefits from investigating new technology and adopting it when it makes sense. Large law firms, in particular, have been doing that forever without needing to create incubators. Similarly, ongoing reexamination of processes help create efficiencies and provide clients with better work product, i.e., striving for excellence.

Sometimes these efforts can take advantage of existing technology; and sometimes these efforts can drive the creation of new technology tools either internally or externally. Often, though, the innovation doesn’t require any technology at all. The more that practitioners can be involved in — and even lead — the review of new technology and existing processes, the more successful those efforts will be. Arguably, without their assistance, the end results will be far less valuable.

Unfortunately, as we all know, the “system”, i.e., the billable hour, will have a chilling effect on attorneys’ involvement in these efforts in any truly meaningful way. The clients’ and firms’ revenues come first. And we are only a little bit closer today to changing that model than we were 40 years ago when Steven Brill first predicted its demise. Firms that provide billable hour credit to associates who work on innovation projects are taking a significant toward alleviating this problem.

The jury is still out on the legal innovation craze and what impact, if any, it will have on law firms, big and small, and in general counsel offices. In the meantime, if innovation were a stock being traded, after seeing the word used on the side of a coffee delivery truck, I might begin to think it’s incredibly overbought and buy a few puts just for grins and giggles.

[1] A Google search for the very first mention of Law and Innovation on the Internet yielded nothing but noise. An old school search of NEXIS found a National Law Journal article from February 1991 that talked about what a firm should do to be an “Innovative Law Firm”.