Canada: Legal Tech And The Changing Legal Services Industry

Last Updated: February 26 2018
Article by Aaron Baer

Food for Thought

When I'm working late, I frequently head down to Marché to grab a salad from their salad bar. At Marché, the salad bar employees perform 3 key functions: (i) taking orders and providing the appropriately-sized container to the customer (who serves themselves); (ii) scanning the customer's card to allow for an expedited checkout process; and (iii) cutting vegetables and preparing the salads for the salad bar.

What's interesting is that during busy times, the salad bar employees primarily perform the first or second functions. However, in less busy times and when there are gaps between customers, the employees perform the third function. The result is that idle time is reduced and employee utilization is increased.

Law firms historically have not operated like this salad bar. Instead, law firm employees often wait for work to come to them. While the utilization of lawyers and law clerks has historically been measured, the utilization of other professionals at firms has not.

The key is for firms to figure out ways to derive value from those idle periods. While billable work can't (arguably) be created out of thin air, firms can make better use of these idle periods by having employees perform other value-generating (but not necessarily billable) tasks for the firm.

As a recent Harvard Business School Study found, idle time is costing employers an estimated $100 billion a year in the U.S. More importantly, many employees wish they had less idle time at their jobs.

To reduce wasted idle time, law firms may seek to (i) re-examine workflows; (ii) re-examine job descriptions/expectations; and (iii) identify value-add, non-billable work that lawyers and other professionals should be performing in their downtime.

Three Articles Worth Reading

Topic What's the Article About? Key Excerpt Why it Matters
Alternative Staffing Models for Law Firms
(James Booth)
U.K. law firm Hogan Lovells launches a flexible lawyering program in partnership with Elevate, a legal services provider. It is all about being able to respond flexibly to what our clients need. There are times when clients suddenly have an urgent need for people in a short timescale – our first priority is to resource that internally, but there are times when you need to respond with a greater capacity. One benefit of working at a big law firm is having access to experts on seemingly all areas of law accessible at your fingertips. If a client needs high-level tax advice, I walk down the hall to see one of the country's top tax lawyers. If the client needs urgent employment or intellectual property advice, I do the same.

But similar to the salad bar example, most firms have lawyers whose utilization is not has high as they would like. And if a firm needs legal expertise, but doesn't have sufficient workload to retain a full-time lawyer, alternatives are emerging. While Hogan Lovells isn't the first firm to launch flexible lawyer services, this is another reminder that firms (and lawyers) have alternatives to employing competent, full-time lawyers.
Use Cases for AI in Law (Alex Heshmaty) Some practical, real-world examples about how AI can be used to augment legal services. Potential Applications:
  • Document assembly and contract analysis
  • Billing and practice management automation
  • E-discovery
  • Case prediction
  • Legal Research
AI can be a scary concept to a lot of lawyers. The reality is that certain tasks that lawyers currently perform will be automated entirely. But in most cases, it will be lawyers leveraging AI to provide high-quality legal advice.

Understanding the use cases of AI in legal can be helpful to understanding how the lives of lawyers can be improved by the use of AI, rather than just perceiving AI as a threat.
Innovative Law Firms (Rhys Dipshan) Ireland-based law firm McCann FitzGerald built an AI-engine to provide technology-enabled assistance to assess GDPR compliance. In anticipation of the European Union's May 2018 implementation of the General Data Protection Regulation (GDPR), technology companies have begun changing their privacy policies and the way they design products.... Seeing an opportunity for compliance technology and services, legal organizations have also started offering products to help clients meet the regulation's strict mandates. Just like CASL posed a challenge for companies marketing to Canadians, GDPR poses a great challenge for companies who offer goods or services to EU residents over the internet. As I wrote back in July, the penalties for GDPR non-compliance are up to 4% of annual worldwide revenue. In other words, they aren't low.

So kudos to McCann FitzGerald for building a technology-enabled solution that attempts to allow companies to assess their GDPR compliance and offer recommendations to improve compliance.

A technology-enabled solution is much more cost-effective, and efficient than the traditional bespoke lawyering approach. Of course, there is little doubt that the firm's lawyers will provide GDPR advice, but the solution should be a whole lot better than conducting the same process manually for each client.

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Who to Follow

Interested in learning more about Legal Tech?

Consider following Clocktimizer (@Clocktimizer), a Netherlands-based company that helps law firms make data-driven decisions using their AI software.

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