Article: How are law firms innovating in a disruptive era?
By Jennifer Brown, Editorial Consultant, ADB Insights
The future of law: More tech, yes, but more collaboration first
Significant advances in society have historically been born from crisis. The need to change both mindset and processes can result in finding collaborative solutions where there was once resistance.
The pandemic has brought change to many at a rapid pace. For some in the legal profession, it has meant a profound difference in how work gets done. Transactions and meetings that were almost always face-to-face have been transformed with technology tools previously deemed too risky or impersonal for client work.
While some would argue that what is happening with remote work is not necessarily innovative, it's part of a wave of change that has been accelerated due to the pandemic. There is a greater need for communication delivered in a more virtual world.
Working differently
When Darlene Tonelli started Inter Alia Law in 2013 as a virtual law firm in 2013, she did it quietly, with little fanfare.
“I got enough flack about how I couldn’t possibly run a law firm strictly virtually that I barely marketed my launch,” says Tonelli of her Toronto-based firm focused on the tech, media and entertainment sectors. Most of the lawyers at Inter Alia Law have come to the firm by way of larger Bay Street firms and in-house counsel roles.
“I was so concerned there was something wrong with this plan — some aspect that I hadn’t thought of — that I launched it very low key,” she says.
Fast forward seven years, and Tonelli has barely felt the impact of the pandemic when it comes to how she works. Her firm has been paperless from the start, and client documents are shared and stored electronically.
Darlene Tonelli, Founder, Inter Alia Law
While many lawyers are still chomping at the bit to get back into the office (and many never left), Tonelli says a permanent change may have occurred in terms of the mindset around work in the profession.
“One of the things I think will permanently change is the acceptance of working from home as a functional option. It’s become a business risk issue — we must be prepared to continue operations in the event of a shutdown,” she says.
She wonders if it will cause other lawyers to question what she calls “the trappings of being a lawyer” — the workspace in a building with a receptionist and an office full of paper.
“I’ve always felt that one of the key areas for innovation in law is in the overhead. We have a massive access to justice issue, and the way our industry is structured, each law firm, whether you’re talking about big or small — there is a fair amount of overhead in everyone’s business. It is divorced from the reality of providing legal services — the nature of my practice for seven years is that I rarely meet with clients in person,” she says.
The widespread uptake of video calling has provided just one way of reducing travel costs for many client meetings and legal proceedings.
“I remotely commissioned an affidavit for a client — that’s something pre-pandemic I would have done in person because there were no guidelines issued by the Law Society about how to do it remotely,” she says.
Tonelli says in the wake of the pandemic, clients are looking for workflow efficiencies and being more strategic about their spend on legal services. Clients also have greater interest now in how Artificial Intelligence can help them.
“One of the things we’re looking at is which tools are best to compare contracts, for example,” she says.
Increased interest in automation tools
At Osler Hoskin & Harcourt LLP, the firm has had a push on innovation initiatives for several years around litigation and transactions. Last year it launched Osler Dash to streamline the franchise disclosure and contracting process. The tool for franchisors prepares, delivers and hosts franchisee documents, including handling e-signatures for a fixed price.
Early in the pandemic, Osler surveyed a small group of organizations and found that one of the biggest concerns they were facing in legal operations was around contract management, regulatory compliance and matter intake.
“Contract management was the biggest identifiable headache that we saw,” says Gillian Scott, partner, innovative products, Osler Hoskin & Harcourt LLP.
It was the ability to stay on top of contracts, and contract negotiation and due diligence, all while remote working, which exacerbated the issue.
“There were instances of clients wanting to look at their portfolios with force majeure issues when the pandemic hit in March and April. They were scrambling to look at each contract because summaries weren’t accessible or comprehensive,” she says.
While finding solutions to these challenges was being considered by legal departments before the pandemic, they are certainly seeing their value now. However, Scott says there is still a disconnect between making the funding available to fix those problems and recognizing the need to do so.
“Securing the budget still tends to be difficult. I do see the opportunity, but there are challenges with those who are hurting financially or just busy putting out fires,” she says.
As things continue to unfold, Scott says the opportunities to innovate may yet to be realized. Force majeure is still on the forefront for commercial leases as government programs have sustained a lot of business to date, but many businesses are barely holding on right now. Decisions about right-sizing organizations that were put off pre-pandemic are now going to be forced.
“Part of being in the innovation space is anticipating the fires that have not yet come,” she says. “For legal innovation and operations it’s often about finding the right person to talk to about these solutions — the decision makers are often divorced from the day-to-day users of the tools.”
Gillian Scott, Partner, Osler
Peter Aprile, Principal, Counter Tax Lawyers
Focusing inward
For some lawyers, the pandemic brought their practice to a grinding halt, providing an opportunity to reflect on how best to use the time presented to make change.
“They closed down the CRA and the Tax Court, completely shutting down our pipeline,” says Peter Aprile, principal of Counter Tax Lawyers.
Looking at the slowdown as an opportunity, Aprile decided to channel his firm’s energy and resources to an upgrade of its CounterMeasure software, which aids in determining the best route for tackling a client’s tax problem.
“We’ve looked at this COVID pause as an opportunity to look at our purpose, our principles and our strategy and to ask ourselves what is important to us? We are already pretty confident in where we are with business efficiencies. The thing our purpose pulls us towards is always better litigation outcomes: How do we get better at analysis, and how do we get better as advocates?”
“We said: ‘We’re going to go build’ and to get better outcomes for our clients,” he says. “I like what we did with our time. This has sped us up by at least two years, but it didn’t change who we are.”
A new spirit of cooperation fosters innovation
When people come together during difficult times, it often presents an opportunity to move beyond “that’s the way we’ve always done it” thinking in favour of a new possibility.
The Tax Court is just ramping up again now, and Aprile says it is demonstrating an interest in greater collaboration with stakeholders.
“We’re excited about that. Everything I have seen from the Tax Court, DOJ and CRA indicate the pandemic seems to have surfaced a spirit of cooperation,” says Aprile. “There is more of a willingness to engage in open conversations, and it seems like we’re all coming to the table differently. We all know we need to band together to make this more efficient and to integrate all of our interests.”
It seems that difficult times cause people to find better solutions through strategic thinking to solve problems that have lingered for too long.