It is usual for people to put themselves at the center of things and so it is in the enterprise. It is the task of organizational leadership, and the purpose of processes to use the natural predisposition of individuals to create the largest value for the organization as a whole.
Bundling legal competencies in one department create economies of scale, and that contributes to the overall efficiency of the organization simply by being a centrally funded function. After all, it would be much more costly to allow each line of business to have its own fully staffed legal department.
Legal tech incubators are becoming the Starbucks of the legal industry—there’s one popping up on almost every corner. Law firms, law schools, corporates, and State Bars are launching them. Also, many lawyers choose to work in large organizations precisely because these organizations allow them to focus on internal client relationships and on legal subject-matters instead of on revenue and costs. We have heard corporate colleagues say that, if they had wanted to become businessmen and think about numbers more than paragraphs, they would have opened their own law firm.
Rishabh Gupta, founder of MyAdvo said:
“The opportunity in this space is huge and thanks to the start-up ecosystem, where hundreds of companies are incorporated in a day, this segment is going to boom. The total legal market is $10 billion (67,000 crores), of which litigation alone is 33,000 crore and 10 percent of that market holds huge potential”
The fast development of information technology is both a driver and an enabler for the changing role of legal.IT systems not only automate and streamline work processes, but they also provide the basis for measuring all aspects of the business and balancing the conflicting goals of agility and control. Leveraging information technology creates transparency for governance, improves decision-making and provides the basis for scaling operations.
Like other disruptive innovations, the information-enablement of legal departments will make some legal jobs disappear. Most administrative back-office functions around managing and process data, for example, can be done more efficiently by machines than humans. And separating routine and high volume activities from high-value legal activities improves the allocation of limited legal resources and increases service transparency.
Shared Service Centers (SSC) are a proven way to scale operations and reduce the workload of senior personnel and expensive experts. At the same time, SSC establishes a clear career path for junior staff. Shared service rest on a unified service delivery platform. For each service in the portfolio, a process model must define which activities are strategic and should be kept in the (global or regional-local) legal line function, and which activities are executed by the SSC; client level engagement, service level agreements (SLA) and escalations paths between experts in Legal and the SSC must be defined with clear KPIs: the SSC funding model (e.g. central budget,co-funding above a base load,pay-per-service) need to be decided; roles, responsibilities, and interactions between the SSC front-office(client engagement) and back office(service delivery) must be clarified, and SSC hubs in low-cost countries must be identified. Legal Process Outsourcing(LPO) companies have been entering this market niche quite successfully in the recent decades.
Underlying shared service centers is software which often must be customized to fit specific needs. Yet when it comes to legal software development, many organizations today suffer from a knowing-doing gap. On one side legal experts, considering their work too complex to be executed by a machine, and on the other side are IT teams, unable to gather the required information to build programs that could ease the lawyers’ work. Even if IT and the legal department do jointly define functional blueprints, technical specifications, and programming work, the end result often is not as expected. Traditional software development usually lacks clarity or business formalization, takes too long and consists of too many isolated phases to create value for the clients and the customers.
For example, a specialized legal team at SAP, a global software company, ran their “business” on MS Excel for more than 5 years because their efforts to develop a simple case management solution together with internal IT failed. Using a rapid prototyping approach a specialized team to build such a solution in only 12 men days-from start to finish.
When software is used intelligently, it bridges the gap between those who know and those who do. The software opens up time for lawyers to think, and thinking creates opportunities for new legal services and jobs. While legal knowledge is ready-at-hand and can be searched in databases and shared in communities, lawyers will still be needed to apply this knowledge in varying business contexts and to communicate emphatically with people. Gathering facts to get a holistic understanding of the situation, weighing interests and claims, seeing the general in the specific, and the specific in the general in the specific, and the specific in the general-these legal skills will be more valuable than ever in the agile organization.
The Indian start-up world is growing and so are the legal issues associated with it. However, most of the start-ups can’t afford a team of lawyers and are also quite unaware about issues they have to deal with.
For example, a Bengaluru-based start-up (name withheld) resorted to legal aid after an ex-employee started a similar company with an identical brand name and logo.
Lawrato!
The start-up, which was bootstrapped and couldn’t afford high fees of established lawyers, found a solution through Delhi-based start-up LawRato, a legal tech platform providing expert legal advice and counsel to enterprises and individuals. LawRato helped the company sent a cease and desist notice followed by a criminal complaint and FIR. LawRato also ensured that the ex-employee shut operations before causing much damage to clients.
Similarly, it also helped save a start-up’s founders from losing control of their start-up as they were about to sign an investor term sheet which had heavily lopsided terms in favour of the investor.
There are several exciting opportunities emerging in the legal technology industry, and it is clear that the legal services industry is ripe for technological disruption to create efficiencies in an industry that is still fraught with manual workflow processes. Nevertheless, as previously discussed, there are significant barriers that have resulted in a lack of technology adoption by law firms and corporate law departments, resulting in a small number of venture capital-backed legal tech firms achieving significant scale, and to date, zero pure legal tech companies going public.