What Will the Future of Law Practice Be?

Earlier this year, I attended a virtual, all-day workshop, Building the Next Legal Practice, by the Center of Legal Innovation in Australia for LegalTech Week. At the event, were asked to envision the future legal industry of 2025.

Compared to Canada, Australia has had non-lawyer ownership for over 20 years and as such, Australian lawyers operate under a different regulatory environment. Australian lawyers had very different predictions for the future of practicing law than a similar group of Canadian lawyers would. I will elaborate on some of these and then relate them to the Canadian context.

1. Half of the legal team will not be lawyers. Employing people that are not lawyers in a law firm or corporate in-house, is not new in Canada. Lawyers often work with law clerks, assistants, or paralegals and then break out to less expensive human resources. Modern-day real estate practices in Ontario, as an example, already have far more law clerks to lawyers.

However, the future of law practice is being transformed, finally, by an abundance of digital tools to improve document automation and workflow. With this change and use of technology, future legal teams will need to be supplemented by data scientists and the technologically skilled. If this is true, as I often say to law students, each of us should be thinking about what skills are needed for this future law practice and how those skills can be built up now.

The pandemic has been a rude awakening for some lawyers. Those who have been reticent to adapt to technology find themselves struggling to keep up. For many years, lawyers have impeded technology change in the courts and to the rules of civil procedure, so that in Ontario in the year 2020, a practicing lawyer still required a fax machine. All of this changed with the pandemic of course, but it took a global tragedy to move us from faxes to email and to start building for the skills we need for the future law practice.

2. CLM will be as ubiquitous as ERP and CRM. Right now, CRM (Customer Relationship Management) and ERP (Enterprise Resource Planning) solutions are omnipresent in modern-day business. The adoption of Contract Lifecycle Management (CLM) solutions is still in its infancy with Canadian businesses, but offers the functionality to assist with authoring, negotiations, approvals, execution, and ongoing renewals, obligations, or compliance of contracts. It will undoubtedly become synonymous with good business practices.

Currently, many businesses may have their contracts in their emails, or if they are organized, in a central document repository such as OneDrive or Google Drive. The contracts are not often looked at again, and renewal periods may be missed, or other terms of the contract not carefully monitored. Imagine having systems and processes around the creation and management of contracts – this is what CLMs offer businesses. What would that mean in terms of how legal work is done in businesses, and how would it change the skill sets that lawyers or legal departments require?

3. Rise of no code solutions may supplant legal tech. Since 2015, the growth in legal tech has been huge – by 2019, the global legal tech market generated over $17 billion and is expected to grow to $25 billion by 2025 (source: Legal tech market revenue worldwide from 2019 to 2025, by business type by Thomas Alsop). However, authors of legal tech solutions rarely have the tacit knowledge of the domain required to provide useful tools that mimic existing legal workflows. Further, compared to other markets, the legal industry is small, and the number of legal tech providers is relatively small, meaning competition is low and software fees high.

No-code solutions and/or business process automation solutions such as Microsoft Power Automate, provides pre-built automation solutions for simple business processes. If the coding is simple, then those with the tacit knowledge of the legal domain, who are best able to design the process, can use these tools to build tailored workflows. It is inevitable that there will be a rise of no-code solutions offered by not only Microsoft, but from Google and other software providers. These solutions will be inexpensive and already embedded and native in a lawyer’s existing toolkit. Tech such as this could bring about increased automation in the legal space at reduced cost, eventually supplanting legal tech solutions.

4. Reading data will be as important as reading legal terms. We often emphasize this to our students at the Institute of Future Law Practice. As businesses automate, the more data becomes available to them, and instead of making decisions on intuition or expertise alone, businesses are looking at data to validate or direct strategy. Amazon is a case example of a company that uses data from website visitors to provide individualized recommendations and predictions derived from data mined from the buying preferences of their other customers. Amazon’s online shopping site has been hugely successful. Other businesses look to them to consider how they could use data to drive profitability, and they in turn want their vendors to demonstrate some sophistication in this area.

Data literacy has become an important skill in the modern business world and law is not immune. While still in its early days, some law firms have embarked on the task of mining their nascent information and deriving data and insights from it. As the legal industry increases its use of technologies, such as workflow automations, there will be reporting and analytics embedded in the solutions, making data more readily available. When you are looking at new software solutions, always ask your software vendor about product reporting functionality and analytics. Data analysis could be a great value-add service for clients.

This past year has seen a growth in adoption of technology in the legal sector. I hope this will continue and the above has provided information on trends that may inform the future law practice.