How midsize companies are adapting to achieve growth
Ari Kaplan recently spoke with Debbie Foster, the CEO of Affinity Consulting; Jennifer Sherman, the chief product and experience officer at Caret Legal; and Laura Wenzel, the global marketing and insights director at iManage.
The three companies are part of a consortium that supported The Changemakers Report: How Midsize Law Firms Are Achieving Growth Through Adaptation, featuring the perspectives of 30 law firm leaders.
Ari Kaplan: What surprised you about the findings in The Changemakers Report?
Debbie Foster: While not surprising, several results stood out. The findings of the Changemakers Report were not surprising, but several results stood out. They noted, however, that law firms grow slowly and that no single activity will transform the way they work. There is no magic pill, quick fix or way to accomplish tasks. It’s all about incremental improvements, and you have to consider increasing and improving the efficiency at a lawyer’s desk. We see that technology knowledge and generational differences can affect efficiency. What may be efficient for one lawyer or paralegal might not be applicable to the entire firm. The days of buying software that only updated once a year are over. Only a few people are able to absorb the new features, as they can’t absorb what they have. It has to be a daily focus on how to leverage the tool optimally.
Ari Kaplan: Half the participants indicated talent acquisition and retention as their most significant challenges. What qualities do leaders of law firms use to help their organizations succeed in the current market.
Debbie Foster is CEO of Affinity Consultant; Jennifer Sherman is chief product and experience officers at Caret Legal, and Laura Wenzel works as global marketing and insight director at iManage.
Laura Werzel: It is the second time that we have seen legal leaders being challenged by associate retention. It’s a perfect storm, because midsize legal leaders are trying to grow their business and navigate a rapidly changing and maturing technological landscape. To achieve these goals, they hire new employees with the skills needed to grow their firm and manage their technology portfolio. The Changemakers Report supports that leaders who are driving change must empower teams to be successful. This is done by communicating, asking questions and showing up curious. They are also changing the culture by trying to understand workflows instead of mandating direction to determine what teams need to be successful.
Ari Kaplan: Sixty percent of the respondents advised that efficiency is their top objective for deploying technology, followed by a commitment to increasing productivity, enhancing security, and empowering client service. How do you see different teams within a law firm collaborating to ensure they select the right tools for their organizations?
Jen Sherman: I have seen technology projects fail because the team was not aligned on what they were trying to accomplish, and change is harder if your mission is not coordinated. Firms that have a cross-functional group with unified goals, regardless of the pains or opportunities they’re pursuing, tends to thrive. The Changemakers Report stresses that by starting small and being flexible, the core team can build on every success rather than only enjoying intermittent victories. This makes change management more difficult. Ultimately, all stakeholders must be represented in their decisions.
Ari Kaplan: The research revealed that training is essential to effectively deploying technology in a law firm. What training should leaders offer to help their teams thrive in the current environment?
Debbie Foster: Junior lawyers need training on how to practice and serve clients. More experienced lawyers require training in managing client relationships and developing business. The Changemakers Report is focused on the relationship between technology and education and how they relate to change management. There are so many opportunities to empower others through training. The research does highlight a recurring issue: many professionals claim they are too busy to attend training, despite knowing the benefits. Teams need to find a way to raise the profile of training and increase its value. They must make it a part of their performance review and demonstrate the importance by making it a top priority. Fifty-seven per cent automate document creation. Fifty percent automate email filing, with a CIO specifically mentioning iManage as a tool for this purpose. And forty per cent automate data extraction. How should teams balance their technology deployment with the individual effort that helps personalize an experience?
Laura Wenzel: Many in the legal industry believe they are unique in their operations, but when you evaluate their workflows, you can often find common, uniform aspects to replicate. The research showed that changemakers are aware of this and can encourage their organization to adopt automation when appropriate. Email filing, for example, has a strong compliance element, making it an excellent use case for consistent actions. When influential leaders explain why a particular action is important, such as centralizing communication and the importance of complying in order to enhance responsiveness, this activity becomes attractive. Teams can also minimize risks and security which are factors that encourage adoption. Changemakers are balancing the available automation with the ability to explain the value of higher-level opportunities to streamline the firm’s work to the organization.
Ari Kaplan: Thirty percent of the participants reported using generative AI through pilots, experimenting with ChatGPT, and deploying the features built into their existing platforms. How do you envision their cautious optimism evolving over time?
Jen Sterling:Generative AI has had a roller-coaster ride in the last 18 months. It would suddenly be able to write legal briefs, draft complaints, and interpret caselaw. There are also embarrassing public incidents when people over-stretch and put too much trust in technology. We expected it to replace seasoned lawyers in its first year, but have been more realistically identifying realistic uses. This technology can save time by automating a simple email response, scheduling meetings, or converting data into graphs. There are places where this technology can add time and peace of mind without trusting it to replace our highest level of thinking in the law, so I am cautiously optimistic about small experiments that are making professionals more efficient but are not necessarily trying to replace skills that have taken years to develop.
Ari Kaplan: How do you see generative AI affecting the way legal teams work and, in fact, even the model that law firms apply to their businesses?
Debbie Foster: It might be the least popular opinion in the room, but we need to stop talking exclusively about generative AI and start talking about a suite of tools people can use to help them get their work done more efficiently. It could be generative AI or it could be teaching someone to use Microsoft Word and Outlook more efficiently. Or, it could be AI that is built into the document management system. When we consider generative AI to be a game changer, we must also take into account the evidence that simply implementing new technology within a law office does not revolutionize the way lawyers work. To maximize the potential of generative AI, we need to create a foundation of productivity. Many aspects of AI also scare law firms. They may not be concerned about themselves, but are concerned about putting the power of AI in the hands those who may ignore its output. Generative AI will not solve all problems, and if not used properly, it could create more problems than solutions.
Ari Kaplan: Ninety-three percent of the participants said that legal technology improves client service, 90% said it increases revenue, and 73% indicated that it drives growth. What do you think leaders are doing to realize that level of success?
Laura Wenzel: The legal sector has matured significantly in its tech adoption, but simply throwing technology at a problem was a knee-jerk reaction during the pandemic. Many have learned from this experience and are now more aware of the problems they’re trying to solve. However, they still apply any technology they can find. Leaders first focus on laying the foundation for solutions. They then build the team and processes necessary to implement the solutions and create a culture of acceptance to ensure success. Changemakers provide incentives to increase adoption, and tell an effective story to convince teams that the technology will maximize their return on investment. How would you suggest they get started? The technology is the only way people can tell if you are a large established law firm. While it is not a sign of prestige or size, it does show a firm’s tech-savvy and ability to scale. Smaller and midsize companies use technology to enhance their growth, efficiency and opportunities. They decide where they are and the problem they are trying to solve, select a technology, implement it slowly and iterate. They decide where they are and the problem they are trying to solve, select a technology, implement it slowly and iterate.
Listen to the complete interview at Reinventing Professionals.Ari Kaplan regularly interviews leaders in the legal industry and in the broader professional services community to share perspective, highlight transformative change and introduce new technology at his blog and on iTunes.
This column reflects the opinions of the author and not necessarily the views of the ABA Journal–or the American Bar Association.
