Canada: Legal Tech And The Changing Legal Services Industry – Weekly Update – January 24, 2018

Last Updated: January 25 2018
Article by Aaron Baer

Quote of the Week

"The lawyer theory of value — solving legal problems one at a time with smart lawyers — is an unstated and unexamined preference of lawyers, not a viable long-term solution for the clients they serve." – D. Casey Flaherty

Three Articles Worth Reading

Why Lawyers Need to Pay Way More Attention to their Data

  • Key excerpt: "But when it comes to marketing and AI, the progress is slower. One of the fundamental obstacles is that most law firms don't have their data in order. And since billing data and marketing data have often lived in silos, it can be intense just matching up information to avoid duplicates. AI simply won't work if it is basing conclusions on bad or incomplete data."
  • Why it matters: As lawyers face increasing pressure to provide clients the cost certainty they desire (i.e. offering fixed fee/alternative fee arrangements) and look to leverage AI and data analytics to focus their marketing efforts, the biggest obstacle that firms will face is their data. Law firms generate a ton of data, but for most of them, the biggest challenge is getting their data in order so that they can use that data to guide their pricing and marketing decisions.

The Baseball Parallel – The Changing Role of Scouts in Baseball, as New Technologies and a Focus on Analytics Change the Baseball Landscape

  • Key excerpt: "There are some in the scouting community threatened by Statcast [new technology that provides an incredible source of data], which can automate tasks their profession has performed with eyes, stopwatches, and radar guns for so long. Is technology threatening to disrupt this labor market like it has done with so many others this century? Is there a chance the size of the scouting workforce is reduced?... I had asked Texas Rangers GM Jon Daniels recently about whether scouts are endangered by technology. "I look at it the other way: it frees the scouts up," Daniels told FanGraphs. "I do think scouts' role has changed a little bit. We don't need them to focus as much on the minutiae of the play by play. They can actually kind of sit back and watch the game a little bit more away from the ball. They can focus on some of the information gathering, the pregame stuff, the work that is being put in. The role has a chance to change here with the information we have."
  • Why it matters: The way that most baseball teams make decisions has changed dramatically over the past decade. Moneyball introduced the baseball world to the use of objective data and analytics to guide decision making. More recently, the introduction of Statcast has provided every team with a phenomenal data set that is far more precise than the observations that any human could possibly generate. Technology (including AI) is set to fundamentally alter the legal profession. There are tasks that can be performed far more quickly and accurately by machines than by humans. But just like scouts and Statcast can co-exist, so too will lawyers and technology. Smart lawyers will use technology to augment the way they deliver legal services.

New Warning for Biglaw Firms – Not That They'll Listen Anyways

  • Key excerpt: "'Consensual neglect' seems a particularly apt description of the strategic posture of many (if not most) law firms in today's rapidly changing market for legal services," states the report. "Ignoring strong indicators that their old approaches—to managing legal work processes, pricing, leverage, staffing, project management, technology and client relationships—are no longer working, they choose to double down on their current strategies rather than risking the change that would be required to respond effectively to evolving market conditions."
  • Why it matters: A recent report from the Thomson Reuters Legal Executive Institute and the Center for the Study of the Legal Profession at the Georgetown University Law Centre was fairly critical of the steps (or lack thereof) that law firms have taken in recent years, in spite of increasing evidence that the profession needs to adapt to changing market forces and new technologies. It's hard to believe that most firms have simply been unaware of the need for change to their business models. That being said, change is tough, and as long as partners are getting paid huge sums of money, many partners will have a limited desire to make changes to a system that appears to be working in the short term (especially if the changes will not benefit them personally). Misaligned incentives certainly discourage innovation and change in a profession that is known for being especially change resistant.

Upcoming Events

Event Details Cost and Registration

Global Legal Hackathon

"Bringing the legal industry together with tech and innovation, world-wide, with one purpose: rapid development of solutions for improving the legal industry world-wide."

February 23 – 25 (Friday evening – Sunday)

Details still to be confirmed, including time and location. The Toronto host has not yet been announced.

Legal hackathons will be taking place all over the world on that weekend.


Click here to register

Who to Follow (1 Twitter Recommendation; 1 Podcast Recommendation)

Looking to learn more about the legal tech industry and the changing legal services industry?

Twitter: Kenneth A. Grady (Twitter: @LeanLawStrategy) is definitely someone worth following on Twitter. He also publishes a daily 'gazette' on his website, which features plenty of good reads.

Podcast: If you prefer the podcast option, the folks at Counter Tax Lawyers in Toronto have created the "Building NewLaw" podcast, which is, in my opinion, the top podcast currently out there to learn more about the changing legal services industry. Each podcast features a discussion with a leading thinker in the space. New episodes are available here or on whatever app you use to listen to podcasts.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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