5 Best Practices for Extracting Value From Legal Tech

Legal technology has gained a secure foothold in the legal industry and has now reached a critical tipping point. Lawyers can no longer be distracted by the bells and whistles, and instead must be focused on identifying and implementing meaningful tools that enable in-house legal leaders to be true catalysts for change across the business. Selling the Dream is a monthly series that separates what is hype from what is real and provides tips for using technology to elevate the status of the in-house legal function.

The legal industry has lagged behind when adopting digital resources and implementing technology. That trend is quickly changing, with legal tech forecasted to comprise 12 percent of in-house budgets by 2025. Every business is different, though, and there is no one-size-fits-all legal tech solution. Instead, deployments should be based on the legal team’s unique needs and the overall business goals.

As software investments continue rising, legal leaders must understand the needs of the department and how to select and implement technology before committing to a solution. Here are five tips general counsels (GCs) and chief legal officers (CLOs) should follow for selecting legal tech and maximizing its ROI.

Determine the time to value.

In business, the adage “time is money” is the law of the land. A big part of selecting the right technology is getting off to a positive start by being able to show that the technology is a step in the right direction of achieving that ideal end state you envisioned (and likely sold) when you were given approval to spend on tech.

Unfortunately, many legal teams buy a legal tech solution, such as contract lifecycle management (CLM) software, only for it to take several months to launch. Whether the delay is due to technological constraints of the selected platform or the legal team not prioritizing implementing the technology (and changing processes to actually use the technology), the damage is done. The tech needs to be able to get up and running quickly so it can be used to make an impact, and the team needs to be properly directed and motivated to embrace the technology, and be loud and frequent in advertising the positive changes embracing the technology has brought to the team and the business.

Once up and running, the tech needs to add value that outweighs any process it imposes. Attorneys need quick access to the status of a contract, project, issue, etc., at any given time, so the faster the tech is implemented, the faster it can help the team. Organizing and responding to these types of requests should take minimal time and effort.

Prioritize ease of use.

Legal leaders should find solutions that don’t require months of training to get the team rolling. While directing your team to adopt and embrace the technology is a critical step in the successful implementation and long-term use of a new platform, the tech needs to meet the team halfway. Legal tech should be intuitive and easy to use to allow for a more seamless adoption and to minimize the risk that any change in process outweighs the benefits of the software.

Even the easiest to use and most intuitive software will elicit questions from users from time to time. Making sure the tech provider has a first-class customer success and support team is essential. Whether five days after signing the contract or five months after being fully implemented, there inevitably comes a time (usually at the worst possible time!) when the team needs help from the vendor to answer questions, address any bugs or software nuances or quirks, or even onboard a new attorney or legal professional to the software.

Understand the business need(s).

Identifying the stakeholders in the business that a legal tech deployment will benefit is essential to selecting the right tool. Does the CLO need better reporting capabilities to quantify the work that the legal team is doing? Are lawyers spending too much time in email and attempting to manage version control for contracts?

Good legal tech software should do three things:

• Provide increased visibility and transparency to business stakeholders;
• Help attorneys understand what work needs to be completed and how to prioritize it; and
• Provide quantitative data that demonstrates the work being done by the team and how the quality of that work changes over time.

At the same time, choosing software that is specifically built for improving the operation of the legal function is critically important. A lot of tech out there purports to shortcut the substantive legal work, but rarely is the ability to do legal work the problem a legal team is trying to solve.  Most often, the root of the problems that are plaguing the legal team can be traced back to one (or even all three) of the above issues.

Business people will use phrases like, “it’s stuck in legal,” or “I submitted to legal weeks ago and haven’t heard back.” These phrases indicate that the business stakeholder has no visibility into whether the legal team is even looking at the issue. The solution is to provide better visibility for stakeholders into the status of legal projects.

Attorneys will often say, “I don’t know how to prioritize these projects, all of them were marked as urgent!” This indicates that the solution needs to help the attorneys prioritize what needs to be done and when.

Finally, when reporting on the effectiveness of the legal function within exec meetings, often times the feedback provided by legal leadership is anecdotal, and based on a handful of conversations with other business leaders who consume the majority of the legal team’s bandwidth. Bringing quantitative data that demonstrates the volume of work the legal team has performed and key performance metrics (like initial turnaround times, time to resolution, etc.) is much more impactful and brings the conversation around the legal team’s performance into an objective, measurable lens that quantifies the impact that legal is having on the organization.

Mandate tech adoption.

It’s not enough to buy the software, the team has to buy into the software.

Incorporating the use of the software into the team’s overall repeatable, standard processes is a necessary component of successfully implementing technology. Assume, for a CLM implementation, the team fails to consistently use the software as intended, including ensuring that all contracts and relevant communications are centralized (yes, even if requests still come via email, which some inevitably will) and put into the system as a matter of course. The legal team is very unlikely to see any meaningful benefit from the software in this case.

This is where most legal tech adoptions fail. A legal team will refuse to change internal processes to incorporate the new technology and then somehow still expects the technology to provide that ideal end state. Unless the team commits to using the technology and makes that use as fundamentally important as doing the substantive legal work of doing “pen on paper” redlines, the solution is unlikely to help you achieve the results you want.

If a business adopts legal tech, legal leaders must mandate the team to use it. It must become part of the legal team’s job to incorporate the use of the software as part of the “substantive” work of being a part of an in-house legal team—it’s all or nothing.

Make data-informed decisions.

Every other business leader within an organization can provide quantitative metrics demonstrating the contribution of the business unit to the overall goals of the organization.  Marketing can show ROI on spend, effectiveness of campaigns, etc. Product and Engineering report regularly on release quantity, timing, features, etc. Sales tracks dollars in due to the team’s efforts. Other functions (HR, IT, Finance, Operations) all have metrics that are regularly tracked and communicated to senior leadership as indicators of success.

Legal needs to bring data to the table.

Legal teams have a wealth of data that flows through the department. Data within the company’s contract portfolio can provide insights into risks, vulnerabilities, and opportunities that lie within existing agreements. Quantifying the work being done by the legal team can provide context to other parts of the business as to how and why certain work is prioritized in a certain way. Data concerning the amount of time legal takes to turn requests can help legal leadership identify when more resources are needed, or when existing resources are not meeting expectations. Data is essential to operating a high-performing department within a broader organization.

Legal tech must make generating, gathering, centralizing, customizing and analyzing data simple, so legal leaders can make better decisions and give better advice. As a part of this, data integrity is essential to form the basis for strong decision-making. The right legal tech provides insights into the quantitative data the technology collects and presents those insights in a way that helps form the basis for consistent and reliable results upon which quality decisions can be made.

Finding the right legal tech solution is a critical step for in-house legal professionals in building a highly functioning legal team. In the digital age, executives expect every business function to drive growth and meaningfully contribute to enterprise value—and demonstrate results.

Bringing the right technology and implementing that technology well will show that the legal team is a true business leader focused on delivering cutting edge service to drive the business to the next level.

This article was originally published by ALM's Legaltech News. Check it out here.