Technological trends in legal sector | Legaltech
What does the legal sector need to be successful in 2022? The answer, given that the trend is increasingly digital, is that the sector has to modernize and join the technological innovations in an already irreversible change.
In recent years, large firms around the world are investing massively in legal technology solutions to gain greater competitive advantage. This increase has accelerated significantly in recent months due to the coronavirus, which has made the transition to telecommuting environments and the maintenance of effective communication with customers, making the use of technology essential.
Innovations such as virtual reality, 3D format, Blockchain or Artificial Intelligence will revolutionize the current legal industry, putting great focus on the customer and facilitating the evolution of the sector towards the so-called, Legaltech.
According to Gartner, by 2024, legal departments will have automated 50% of legal work related to major corporate transactions, and will replace 20% of general counsel with non-legal staff.
- 1 What is Legaltech?
- 2 Trends for the legal sector in 2022
- 3 Virtual Coffe: Harness the Power of Data & AI in Legal Services
What is Legaltech?
The term Legaltech refers to technology that is transforming the way law is practiced and is used to market or provide legal services. Its main objective is to facilitate the legal exercise by minimizing waiting times, costs and increase productivity.
Trends for the legal sector in 2022
Now that we know what Legaltech is, we will see how it will evolve over the next few months and what are the dominant technological trends in the legal sector.
By 2025, spending on legal technology will triple, at least 25% of spending on corporate legal applications will go to non-specialized technology providers and will capture only 30% of the potential profit from their life-cycle management investments in their contracts.
The application of Artificial Intelligence in the legal industry will have a revolutionary effect when companies in the sector realize all the benefits that it will bring. There are many that have already incorporated it into their daily operations to streamline many of their processes, in addition to significantly reducing margins of error. One example is a UK firm, where they use AI to allow personal injury cases from road accidents to be litigated electronically, thereby reducing costs and speeding up customer service.
Another application would focus on the laborious task of verifying contracts in search of terms for specific clauses. This is one of the most recurring tasks of the legal process, and the most time and effort required. With AI-based software, machine learning algorithms can be used to review and analyze the most relevant case data, as well as identify similar documents. This greatly streamlines the process and allows lawyers to engage in activities that require further analysis, attention and experience.
The goal of Artificial Intelligence in the legal sector is to complement the activity of lawyers, not to replace the professionals themselves. Therefore, the aim is to provide them with the necessary tools to facilitate their more repetitive tasks and give them time to perform more specialized tasks.
Many law firms have already been introducing blockchain technology thanks to its great potential in the legaltech sector. Use cases such as smart contracts or tools for intellectual property protection and digital representation of different assets are some examples.
Also noteworthy are the cases of asset certification or management of corporate boards to revolutionize the processes of conflict resolution, making them much simpler and providing personalized services for the citizen.
The drafting of documents is part of the daily work, but it is also one of the tasks in which more time is spent. Competitiveness for efficient document management has led the legal technology trend to focus on the use of automated document-writing software to gain a competitive advantage.
Something that would traditionally take days to see the light if done manually, can now be created in a matter of minutes. According to McKinsey and PWS studies, 25% of lawyers’ time can be automated. Automation provides tools to organize more effectively, such as data collection, reporting, daily tasks and billing. In addition, this technology has the advantage of adapting to the needs of each company, which translates into improved profitability and efficiency.
Currently and under the circumstances, many of the legal proceedings are conducted remotely through videoconferences, so it is very important that they be recorded to obtain a transcript. Court reporters can now expedite their work with the help of legal transcription software. The results have figures of 99.9% accuracy and omits problems such as audio quality.
The great advantage of this is the speed at which these transcripts can be generated, lowering the number from weeks to days, even hours. This saves enormous money and time compared to traditional methods.
Dispute analysis and forecasting
Many countries around the world are joining the use of AI and Machine Learning tools, where they have seen how cases can now be predicted more effectively. Studies have shown that the cases in which these technologies have been used are far more reliable than human prediction. The numbers show that a model predicted 75% of the court’s results compared to 59.1% that the experts’ predictions.
An example is the Estonian Ministry of Justice which, in 2019, developed and tested AI-based software to listen to and decide on disputes with disputes below €7,000. The results are so good that following the example could trigger a global wave of AI use in the justice sector.
This is not a new tool for many sectors, as many companies have been using them for a long time. The legal sector has not been at the forefront to date and yet it is estimated that nearly 25% of legal agencies will adopt this technology to increase their operational efficiency and simplify complex operations that do not require much human intervention.
Virtual paralegals, also known as chatbots, have the potential to increase the operational capacity of internal corporate teams. These can help businesses deal with internal questions that legal departments face, as well as improve response time and efficiency. It should not be forgotten that virtual paralegals cannot replace human figures, but they will save them a lot of time in answering the most recurring questions repeatedly, and devoting time to tasks that require more attention. In addition, to ensure the success of chatbots, experts will need to set them up correctly and do extensive initial research.
Virtual legal practice and Teleworking tools
Two years ago, the United States experienced a boom in virtual law firms. It is a fully regulated practice whose professionals operate from their homes or offices, which focuses on providing services to customers remotely using technological means.
They have the same legislation as traditional law firms, with the difference that lawyers can be independent consultants rather than employees or partners. Thanks to this, many professionals in the sector consider the exercise in virtual format, which places it as one of the major trends of 2021.
In addition, tools such as Zoom and Microsoft Teams grew by 37% and 36%, respectively, over the previous year, so this trend is still on the rise. Coupled with new digital communication methods, such as automated phone messaging, smart greeting tools, voice technologies… Going to the office will take on a new meaning, flexibility will be boosted, and teams will adopt new technologies for better collaboration.
The adoption of the cloud is not the most innovative trend, as it started to rebound in the industry for some time. However, cloud solutions have increased by more than 20% by 2020, as, along with custom legal solutions, they help large agencies protect their databases and meet the needs of their customers wherever they are.
Software solutions, such as case management and document sharing applications, now use cloud solutions to access critical information without having to worry about cybersecurity. Cloud adoption extends to almost every part of the business, such as email, shared documents, eDiscovery, case management, Microsoft Office, hosted phones…
The big advantage of migrating to the cloud is that companies no longer need to invest in expensive infrastructure or have their own server installed. You only need to have access to the Internet and we already have everything at our fingertips.
No wonder you also want to focus on mobile apps, as most people spend most of their time in front of their phone’s screen. Figures argue that there are nearly 3.2 billion mobile app users worldwide, so launching our own specialized app has become a booming trend within the legal industry.
Making this decision increases the chances of attracting more users and improving their experience as our customer. In addition, if the professional can access reports or various information, you can manage your work remotely with the help of these custom applications.
The latest trend may be the most conspicuous or even seem to be off. However, in the coming years, the use of augmented reality in the legal sector will be very important. An example is Apple Glass, a virtual reality viewer that will launch in the coming months, that will create new ways to digest, interact and expand legal applications.
As we mentioned in the previous points, the change of course of the working meetings towards the digital environment requires that these barriers of space are broken. An example would be to be able to interact with clients as if they were in the courtroom or show a jury the crime scene with a 360-degree video.
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