In recent years, the legal industry has experienced significant change. The global pandemic has necessitated and encouraged new ways of working and thus opened doors for innovative businesses to fill the market, the legal sector has never looked so diverse. Law firms must continue to evolve to keep up with the rapidly developing picture.
It is well known that innovation attracts catchphrases and slogans. In this blog we aim to clarify the key legal terms; LawTech, LegalTech, NewLaw and BigLaw, to help better understand how the legal industry is changing and how we can all get more from our legal services.
1 - LawTech
The term LawTech describes technologies which are designed to make legal functions more accessible, and to make performing them quicker and easier. The advent of LawTech means that businesses and individuals are able to access different legal services in a variety of new ways. Increasingly, people can now undertake tasks themselves which a lawyer might have traditionally performed. Let’s consider some further examples of LawTech technology;
Connecting clients with lawyers;
Legal services were traditionally obtained by contacting or meeting with a lawyer you already knew. In turn, they will refer you, through their professional or personal network, to a lawyer who has the appropriate expertise. All this has changed now. Several firms offer online booking on their websites, Chatbots can now answer simple legal questions and platforms like LawBid allow instantaneous access to solicitors nationwide at the click of a button. Through these technologies, businesses and individuals can quickly gain access to a large pool of qualified legal professionals and find the right lawyer for their situation.
In addition to improving document sharing and use by lawyers and their clients, technology has also improved security and privacy. Traditionally, simple processes like executing a document required the involvement of lawyers. However, online execution has simplified and streamlined the process, enabling contracts to be quickly and easily executed across borders and time zones.
LawTech has also made legal services more accessible by moving a large majority of them online. Now it is possible to access online dispute resolution services from the comfort of home without having to travel to the court. Through specialised mobile applications, collecting documents in sensitive circumstances (such as those involving domestic violence) is also now easier and these applications are greatly improving claimants' chances of success.
Practice Management technology and document automation;
LawTech makes repetitive work easier for lawyers, thus lawyers are able to provide their clients with legal services more quickly at a lower cost.
One of the best examples of this is the automation of contract documents. Law firms use templates for contracts and customize them to suit the needs of their clients. It is easier for lawyers now to identify the true value that they provide thanks to document automation, thus enabling them to be able to offer alternative fee arrangements that reflect this added value. For example, some firms are now more confident in offering 'no win no fee’ promises and fixed fees instead of hourly rates for more matters which all benefits consumers more.
The use of LawTech has also improved timekeeping for lawyers, resulting in less time spent on administrative tasks. Spending less time on repetitive tasks leaves more time for more value-added activities, such as better understanding clients' businesses and offering targeted advice.
AI Software Solutions;
Formerly, lawyers spent hours reading hard copy documents in order to prepare for a dispute or a corporate transaction, but many of these tasks can now be accomplished using artificial intelligence.
Clients and lawyers can now store documents in a more secure, efficient manner thanks to the advancement of software solutions through LawTech. In addition, these systems provide a way to easily search and categorize documents.
Furthermore, lawyers now have access to tools that enable them to understand large amounts of information more efficiently and comprehensively. Prior to electronic searches and research, lawyers relied on printed judgments. Now, they can perform searches and research electronically and gain insight from historical data. Some of these insights are being used to forecast the outcome of class actions and legal proceedings and based on this information, a client can decide whether to take legal action through the justice system. Overall, it makes it easier and faster to answer people's legal questions.
2 - LegalTech
The LegalTech sector is also concerned with developing technological solutions for the legal profession, but with a focus on lawyers and law firms. It is a subcategory of LawTech and refers to technology that automates processes and operations, thereby saving lawyers' time and their clients' money. Several LawTech examples above fall under the banner of LegalTech as well.
3 - NewLaw
NewLaw refers to entities in the legal industry that have broken away from those traditional models that have come before them, in an attempt to address the problems facing those who interact with the law. It is the opposite of BigLaw, which refers to firms with a more traditional business model. Key differences include;
- utilising technology to enhance efficiency and deal with legal issues;
- new billing arrangements such as subscription-based services and fixed fees;
- developing commercial solutions that address client needs;
- business development and marketing are the main methods by which work is won;
- Integration of legal specializations to provide clients with a seamless and complete legal package; and
- the pursuit of innovation
NewLaw is mostly associated with innovative law firms but is also sometimes used more broadly to describe other legal services providers and entities that provide LawTech and LegalTech solutions.
4 - BigLaw
The BigLaw business model is traditional for law firms. It is characterized by partnership models and hierarchical structures and encompasses the following;
- a partnership model, where partners share in the equity of the firm and are promoted from within;
- hourly billing;
- high hourly rates reflecting the expertise of varying practice areas;
- a hierarchical structure, which is not conducive to simpler, less specialised legal work;
- the majority of work is won through networking, based on reputation and personal connections.
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