This new series of events has been launched to provide a discussion forum focused on the specific issues and challenges that face small and mid sized law firms in relation to the adoption of technology related change. The need to engage specifically with this group has been a common theme of feedback and discussions from previous LegalTech in Leeds events.
The format of the event was a roundtable discussion, with four guest speakers each providing stimulus for group discussion. This was an evening event, in acknowledgement of the fact that it can be difficult for SME law firms to take time out of their standard working day to join events like this.
Julian Wells kicked off proceedings. Julian is director at Whitecap Consulting, which has been coordinating the LegalTech in Leeds initiative since its inception in January 2022. Since this time, nearly 30 events have taken place, bringing together the legal and tech sectors in the region and helping create a LegalTech community.
Katherine Megson, Innovation Events & Programmes Manager at Bruntwood SciTech, welcomed everyone to Platform and outlined the ways they support the regional economy, including hosting numerous tech-focused events and programmes, including initiatives such as the Female Founder Incubator.
Emma Pearmaine is Managing Director of Ridley & Hall Solicitors and a Director of Leeds Law Society. Emma has been involved in LegalTech in Leeds since its inception, and throughout that time has championed the need to support smaller law firms, and in particular those with a B2C / direct to client model.
Emma said that Leeds Law Society was enthused by the interest of Leeds City Council in supporting the growth of the legal services sector, including the smaller law firms. She noted that Leeds is one of the strongest cities in terms of the provision of high street legal services and legal aid services, both of which provide strong socio-economic benefits.
Moving on to focus on SME law firms, Emma said these firms face many of the same issues as larger firms, but their problems are exacerbated by lack of resources and time to address them. Ridley & Hall is nearly 100 years old and employs approximately 120 people across 4 sites. When Covid hit, the firm had just purchased new desktop computers for the team. It was not in a position to buy laptops, so Emma and colleagues had to drive the desktop computers to people’s houses so they could continue to do their work. There is a lack of time, expertise, and resource to think and research how technology products and services can help the firm.
“Most people in the firm are focused on clients and bringing in revenue, not things like tech. I know were’ not that different to other law firms in this regard.”
Emma also explained that it’s not just the cost of the purchasing new technology systems, it’s also the time involved and the opportunity cost in terms of billing. Changing a tech system comes at a huge cost to the business, and the cumulatively high cost of tech and software licences per employee has become so significant that it has even had an impact on decisions relating to hiring apprentices.
Ridley & Hall conducts a significant amount of Legal Aid work, and Emma used this an example of an area where technology could potentially help.
“We can’t get paid more for Legal Aid work, but we need to employ good people to do it. Understanding how we can use tech to do it more efficiently is really interesting for us to look at. Other firms have exactly the same challenge, so why can’t we work together to find collective solutions for smaller law firms?”
Cybersecurity insurance premiums have increased more than threefold for some firms, as the insurance market adjusts its pricing as it develops it’s understanding of this market.
Small criminal lawyers will be under huge pressure financially due to rising costs.
Laura Kaung is Governance, Compliance & Cyber Security Manager at Jungle IT, one of the strategic partners of LegalTech in Leeds.
Laura’s focus is on the first line of defence, and much of her talk focused on the importance of people and culture in protecting against cyber attacks, highlighting that the point of weakness for an organisation is usually a person rather than a system or process.
Laura said that smaller law firms are often targeted by hackers, and these firms don’t have the investment in cybersecurity protection. Residential conveyancing is a commonly targeted department, due to the high value transactions involved. The initial threat usually comes from clients being hacked rather than the law firm itself, but hackers use clever methods to gain access to systems such as email, and are then able to attempt to defraud a firm and its clients of funds.
Ensuring people are appropriately trained and also constantly aware of the threat of cyber attacks is critical. Regular communications about best practice and things to watch out for are important, and from the discussion in the room it was clear that cybersecurity awareness is part of staff induction process and ongoing training for firms. One firm had hired a an ‘ethical hacker’ (penetration tester) on multiple occasions.
“You’ve got to bring it down to people’s level and make it relatable. Not everyone is a tech expert and it’s important to recognise this. Also, we need to remember that people are human and will make errors.”
Laura highlighted that although cyber training is a cost, the cost of getting caught out by a cyber attack is infinitely higher.
Nevil Tynemouth is Lead Director at New Results, a people consultancy focused primarily on the professional services sector. The firm is increasingly active in the legal sector.
Nevil said that over many years of consulting he has observed that firms that do extraordinarily well have a real focus on what they need to do. But how do you focus? New Results uses a three-pronged model which involves using a microscope, telescope, and mirror approach to enhancing performance of people and processes.
The ‘microscope’ approach is appropriate where the focus is on a specific issue, such as AI or a CRM system. The ‘telescope’ approach is for looking at the longer term and big picture, helping firms to decide where to spend their time and apply their resources. The third approach is ‘mirror’, which involves the critical evaluation of the firm’s performance.
Nevil also highlighted the importance of understanding and enhancing the client journey. He explained that this is not simply referring to the process a client goes through with a firm, but it also relates to the emotional journey a client goes through, and the key role this plays in whether the client has a positive experience or not.
On the subject of technology, Nevil said that in order for a law firm to get the benefits of technology, you need buy in/ engagement from all parties including the law firm and the clients. He feels that technology can help break down silos in law firms because the use of common systems ensures that working practices and record keeping need to become more standardised, rather than varying by partner or department. Nevil also noted, however, that major technology like CRM is still not present in a surprising number of firms.
Nevil posed an interesting question in relation to the adoption of Artificial Intelligence in the Legal sector:
“At what point will clients start asking whether AI can do a better job than the lowest quality solicitor?”
Ian McCann is CEO (Chief Engagement Officer) at Legal Studio, a law firm with a business model whereby the lawyers are self employed.
The firm currently has 25 consulting lawyers, and is aiming to more than double in the next 5 years. In Ian’s words: “We exist to help lawyers enjoy work.”
Ian stated that more than 60% of law firm employees have had poor mental health, and 6% have considered suicide. He asked why, when numerous studies have found that happiness improves productivity and results, isn’t the sector focused on creating it?
The Legal Studio model requires a change in mindset for lawyers, who need to evolve into business owners due to the self employed model. There were a number of questions for Ian in relation to the risks and responsibilities of the firm and its lawyers.
In terms of technology, Legal Studio provides tech to its lawyers. Ian noted that there are lots of advantages to technology, but you have to focus on the people element of the business when operating in the legal sector.
Ian concluded that the Legal Studio model creates happier lawyers, who deliver a better service to clients.
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