I started blogging here 5 years ago. It’s a good occasion to think about how my posts have evolved. I now see that both the legal market and I have moved to “Legal Technology 2.0”. 

Why, you might wonder, does a blog called Strategic Legal Technology cover topics such as working virtually, derivatives to manage law suits, business intelligence, and outsourcing? In Legal Technology 1.0, we focused on infrastructure and applications. Just getting IT to work and lawyers to adopt new systems was a huge challenge. That’s still hard, but around 2000, forward thinking CIOs began thinking about “operations” in one bin and “strategy / practice support” in another. Today, even that distinction is not enough.

In Legal Technology 2.0, firms and CIOs must deeply embed technology in their strategies. Legal Tech 2.0 stems from a two-front legal market war; each front has two battles. There is a war for talent and a war for clients. To get and keep talent, firms must offer the right mix of life style and compensation. To get and keep clients, they must offer the right mix of client service and results. See the illustration below.

In Legal Tech 2.0, firms must wield technology to win these battles. Simple “first order (1st order) technologies” as weapons no long suffice. Instead, firms need “second order (2nd order) technologies”. This is more than merely rolling out new apps. They must transform how they do business, with tech playing a central role.

It’s already happening – I’m just labeling it. Consider Bryan Cave’s business intelligence, Morrison Foerster’s AnswerBase, or Mallesons web-supported recruiting. And consider that at least two global law firm CIOs have new roles and titles that go well beyond technology to encompass business process and strategy.

Two years ago, I developed a portfolio approach to evaluating practice systems. It’s a “2×2” framework for choosing among practice support tools by comparing revenue enhancement impact against reduction in effort effects. Nice, but not closely enough linked to business strategy.

In the diagram below, an illustration and not a comprehensive picture, I link three 2nd-order uses of technology to law firm battle fronts. “Working virtually” is a way for law firms to offer lawyers and staff improved life styles. Outsourcing is a way for firms to reduce cost (and hence increase compensation) and improve client service (and hence gain and retain clients). Technology enables both but firms must make many other process and cultural changes.

“Results Metrics” has yet to be conquered. Firms that crack this will win market share. Using technology, surveys, interview, and research, firms or third parties must devise ways to evaluate more rigorously the results of legal representation. When clients can choose from many A-list global law firms, real data on actual results will play an increasingly important role. (Of course, 2nd order tech will be critical to improving results.)

I could have lined up other 2nd order technologies here, including ones I’ve written about such as online legal services, knowledge management, business intelligence, decision trees, etc. The point though is to figure out what the new 2nd order technologies will be. As Legal Tech 2.0 evolves, how will we as a profession and market create additional weapons to fight the battles to come?

Analyzing a Law Firm's Options in a Portfolio Approach

This first appeared at Strategic Legal Technology at Prism Legal.