Legal innovation is all the rage in our profession. In fact, innovation has been a hot topic in many industries for a while now. Law’s stock in trade has been analyzing and applying specialized legal knowledge to solving clients’ problems. But since technology has made information widely available, lawyers no longer have a monopoly.
The general public is searching the internet for legal information and services. Companies are selling legal information and services on the internet. And corporate clients are demanding greater value from their lawyers.
What does this mean? Lawyers need to change the way they practice, and legal education needs to change the way it trains the next generation of attorneys.
Legal Innovation Means Changing the Way Lawyers Practice
According to data gathered by the American Bar Association in 2016, 49% of lawyers in America are solo practitioners. Another 14% practice in a firm consisting of 2-5 lawyers and 6% practice in a firm consisting of 6-10 lawyers. Likewise, in Illinois in 2018, solo practitioners and lawyers in firms of 2-10 attorneys accounted for 54% of the 50,000 in private practice. We haven’t highly researched this part of the legal population. That’s why data from Clio’s Legal Trends Report over the past three years are so revealing.
Clio, a company that provides a cloud-based project management application, aggregated data from nearly 70,000 solo and small- to medium-sized firm attorneys who use the Clio platform. The 2018 data showed that lawyers logged only 2.4 hours of billable time per day and collected payments on only 1.6 hours per day. This is an average utilization rate of 30% and a collection rate of 20%, based on an 8-hour day.
Clio also surveyed 3,000 legal professionals on how they spend the 6 hours per day that’s not billed to clients. The 2017 Legal Trends Report showed that office administration (including generating and sending bills, configuring technology and collections) consume 48% of time that could have been spent on billable tasks. It also showed that 33% of lawyers’ time is dedicated to business development (i.e., landing new clients).
These data support anecdotal reports that I hear from solo and small-firm practitioners across Illinois who are having trouble making ends meet. They complain of being overwhelmed by trying to master technology, land clients and make payroll.
Lawyers clearly need help with office operations such as billing, tracking time, conflict checking and case management systems. The idea of a firm being more efficient in its support areas is an easy sell. The other piece, business development, is harder. Can an allied professional who isn’t a lawyer do this sales job?
This, and the idea that the legal ecosystem should embrace experts in areas such as data science, business and finance, has been advanced by various leaders in the field. Lucy Endel Bassli, formerly of Microsoft and current assistant general counsel at Snowflake Computing, is an advocate. Come hear her take on legal innovation and more at The Future Is Now: Legal Services 2.019 on May 16 in Chicago.
Legal Innovation Means Changing Lawyer Training
The legal education system is steeped in tradition. Lectures delivered by professors who wrote the casebooks or treatises are intellectually stimulating and a bit intimidating. But few of those professors ever practiced law. If they did, it was decades before distinguishing themselves as intellectual thinkers.
Back in my day, we were told that we would learn about the practice of law when we were out of law school. Does The Paper Chase just run on? Fortunately, there’s been progress since then. We now have numerous law school clinics and put an emphasis on graduating practice-ready lawyers. But what does that mean? Are law students learning process and program management, artificial intelligence and predictive coding?
There’s a movement in law school curriculum to include courses that consider topics outside of the law. “Law and—” courses, such as law and medicine, law and technology, and law and psychology, integrate substantive knowledge from other disciplines into the elective legal curriculum. Some law schools have truly embraced this innovation (see Dan Linna’s Law School Innovation Index).
But there may be more disruptive changes underway. For example, Northwestern University offers a Master of Science in Law with a flexible curriculum that centers on the intersection of law, business and technology. To add to that, in a unique partnership between law schools and employers, the Institute for the Future of Law Practice (IFLP) is entering its second year of training law students through bootcamps and paid internships.
Dan Rodriguez, Harold Washington Professor at Northwestern University Pritzker School of Law, is driving much of the innovation at IFLP, in law schools and at the ABA Center for Innovation. He’ll discuss how the legal industry must proceed rapidly and creatively in this changing environment at The Future Is Now.
To better serve our clients and our profession, we must all embrace legal innovation. How to do so will be a salient topic at The Future Is Now. Tickets are still available, but seating is limited. Register today.