In this age of technology nobody is still using a pen and paper to write legal contracts, so the question arises as to why so many law firms are still using the aged pen and paper to execute them?
Despite tech marching forwards throughout the legal industry, the process of transaction management has so far resisted progress. Whilst many legal processes and practices have been revolutionised, the majority of law firms are still wading through the laborious, pricey and open-to-error practice of a paper-based closure system.
However, like many other aspects of legal work, it needn’t be this way because legal tech has come up with a myriad of highly effective transaction management systems to enhance solicitor’s working practices. More importantly, firms who have adopted the use of these transaction management systems are gaining a competitive edge in the marketplace.
So how does tech solve problems of transaction management?
In order to finalise a business transaction, a law firm must get all stakeholders to sign off on a lengthy document, a task which can often take months plus all parties must sign multiple pages leading to confusion. Eventually the transaction will close, but most likely no one will be especially happy about the whole process. For solicitors, this methodology involves an inordinate amount of paper organising, printing, scanning, assembling bundles and chasing people down for signatures. Clients have barely any input into the process and are often left feeling confused and unhappy.
Now take this process and add technology into the mix. Imagine the transaction commencing with a dynamic interactive check list. The stakeholders involved upload relevant documents to a secure online site for collaboration. As each party goes through relevant documents, contentious points are highlighted and discussed in real time enabling almost immediate review and approval. Finally, all parties are able to digitally sign an automatically assembled signature package. A process which previously took weeks or months, finalised in a day.
Put simply, technology streamlines transaction management by removing paper form the process. Without physical paper documents, there’s less time wasted shuffling paper around and waiting for signatures. Technology centralises and consolidates multiple documents for collaboration, versioning is clear allowing participants to immediately access, change, comment and resolve disputes. Lastly, technology automates a previously labour intensive and repetitive process, decreasing frequency of errors and freeing up legal professionals’ valuable time.
And what is the upshot of this for law firms?
Firms who have chosen to adopt these forms of technology to manage transactions are enjoying a huge competitive edge in the sector. They are able to accelerate the closing process, documents are collated and generated digitally at the click of a button. Furthermore, digital transaction management protects clients’ sensitive information more effectively than traditional paper methods by using secure document housing. By adopting a transaction management system, all parties can easily be involved and monitor the status of a transaction in contrast to traditional systems. With full transparency into document alterations and real time updates, parties will be informed as to what they are signing resulting in overall satisfaction high above traditional methods.
All in all, the benefits to law firms are clear; legal professionals reduce the amount of time spent on low value activities, creating more time to focus on client interaction. Law firms using technology to manage legal transactions ultimately have more satisfied clients, in today’s digital era clients have an expectation that their law firm is leveraging technology where possible to lower costs and streamline services. The fact that the legal sector is lagging behind other service sectors in this tech adoption is baffling and frustrating to both business and private clients alike.
It is difficult to argue against the case that happier clients lead inexorably to improved client retention, new referrals and new work which is providing firms that all important competitive edge in a crowded marketplace with established firms and alternative legal service providers. Digital transaction management is merely the tip of the iceberg in terms of law tech, yet even this relatively simple piece of tech is proving slow on the uptake by many firms. This inherent suspicion within the industry towards legal tech and law tech adoption must change if firms want to remain competitive in a changing market and ultimately provide the best service to their clients.