Ditch the fax! Tips for building a tech-savvy law firm

The right technology can help law firms streamline their operations, automate tasks and offer better services to clients. Examples include practice management systems, document management software, e-discovery tools, legal research tools, billing and invoicing software, and video conferencing and communication tools such as Zoom, Teams and Slack.

But choosing the right technology can be time-consuming and daunting.

In this article I set out a few factors to consider when procuring technology, based on my experience with our firm that started 15 years ago with eight people and has now grown to almost 50.

Identify your needs

Every firm has unique requirements so the first step in procuring technology is to identify what you need. For example, some firms may want an all-in-one practice management system for their time recording, billing, client relationship and document management. Others may want separate systems to perform some or all of those individual functions.

We use a practice management system that has limited document management capability. As our firm grew, so did the number of documents and emails being created, stored and filed. Rather than trying to find one practice management system to meet all our needs, we decided to implement a separate best-of-breed document management system (DMS) that would work with our existing practice management system. So it’s important to evaluate your specific challenges and consider the areas where you want to improve efficiency, reduce costs or enhance client service. Our DMS has helped us to improve in all those areas.

If you’re not sure where to start, talk to other law firms and ask what solutions they’ve used, how they’ve found those solutions and what they might have done differently.

Evaluate the technology

Once you’ve identified your needs, you should consider the available technology options. Look for solutions that are user-friendly, customisable and scalable. Also consider the level of support available from the vendor, as well as the cost of the technology. Take advantage of free or limited-cost trials or demos to test the software before making a purchase. For example, we are upgrading our phone, video conferencing, instant messaging and mobile technology platform and have been trialling a solution for the last few months at no cost to ensure it works.

Evaluate the vendor

When selecting technology vendors, it’s important to do some proper due diligence. How long have they been around? Who are their customers? Do they have a decent-sized New Zealand customer base or will you be one of their first local customers?

Look for vendors with experience in working with law firms and a track record of providing reliable and effective solutions. Ask for references from other law firms to get a sense of the vendor’s reputation.

Consider integration

Technology should work seamlessly with your existing systems and processes. It’s important to consider how it will integrate (e.g., practice management systems, DMS, communication and messaging systems, email, calendar) and other software you use, such as accounting or HR software (e.g., Xero or MYOB) and standard productivity software (e.g., Office 365).

We spend a lot of time ensuring our systems talk to each other. It’s equally important to ensure there is a commitment from your vendors to work together:

• when there is a technology project underway;
• to resolve an issue in your technology environment; or
• to ensure the smooth day-to-day operations of all your systems.

Security and compliance

Legal technology often involves sensitive client information so security and compliance are crucial. Remember, you and your firm have obligations under:

• the Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 to ensure information remains confidential and to prevent any person from perpetrating a crime or fraud through the firm’s practice. The rules specifically refer to taking reasonable steps to ensure the security of and access to electronic systems and passwords; and
• the Privacy Act, in particular, Privacy Principle 5: when holding personal information, you must have “security safeguards” in place to protect against loss, access, use, modification or disclosure.

Make sure the technology is designed to protect confidential information and ideally meets industry standards for security (e.g., ISO27001 and ISO27002, which are international standards and guidelines for information security). Look for technologies with robust security features, such as encryption, multi-factor authentication and access controls.

Training and adoption

The success of a technology implementation depends on user buy-in so before procuring technology, consider how you will train staff to use it effectively. Ensure the vendor offers training and support to help staff get up to speed quickly. It’s also useful for the vendor to train someone in the firm who will provide training to new joiners and others (i.e., “train the trainer”).

You should also have a plan for communicating the introduction of the new technology, promoting adoption and encouraging staff to use it consistently. I remember hearing a near-disaster story from someone at another law firm that introduced a new system one Monday but people were told of the change only that morning!

Consider scalability

As your law firm grows, your technology needs may change. It is important to consider the scalability of any technology you procure. You should consider whether it can accommodate your firm’s growth and changing needs, and whether it can be easily scaled up or down.

For example, one reason we moved our systems from our physical server room into the cloud about five years ago was to give us the ability to scale up quickly. Previously, to avoid running out of storage space because of the increasing volume of emails and other documents being created, stored or filed, we would have to physically swap out hard drives for larger ones, which would result in downtime. Now we simply request our cloud provider to increase storage space and this is done almost immediately.

Read the fine print

No matter how small or large your law firm is, there should be a written contract in place between the firm and the vendor. You should review the contract and be prepared to negotiate it.

Some of the issues to consider in your contracts with your vendor include:

Term and termination

Consider the term of the contract and how it can be terminated. If the technology you are procuring is business critical (as opposed to "nice-to-have"’), you may want to agree an initial term with an automatic rollover for a similar length term (unless you decide not to continue before renewal occurs). I’ve seen contracts that roll over after an initial term on a month-by-month basis, which wouldn’t give the firm much certainty that the technology would be available after that initial term. Give yourself plenty of time before renewal to raise any issues with the vendor and negotiate any terms (such as pricing). If you’re using technology that is nice-to-have but not business critical, consider whether you want the right to terminate on short notice (e.g., 30 days) if you decide the technology is no longer suitable for your firm’s needs or if the uptake by people in the firm is not as high as expected.

Pricing

Vendors will often provide sharp pricing to get customers onboard. Consider what controls are in place to limit price increases after, say, an initial term. By the time the initial term is up, you’re unlikely to be moving to a new system so you don’t want to be hit with a significant price increase.

Service levels

Consider what levels of service are provided to the firm. How quickly will the vendor respond to a request for support? What is the availability or "up-time" of the service, particularly if it is cloud-based? For example, if you have a time recording solution offered by an overseas vendor, you don’t want them carrying out any scheduled maintenance during working hours.

Data security / privacy / confidentiality

One of the greatest risks a law firm faces is a security or cyber incident. The contract should set out in detail how the vendor deals with data security, privacy and confidentiality. How quickly will the vendor notify you if it is aware of a data or security breach? Does it even have an obligation to do so?

Liability

Check out the vendor’s liability position. While it’s common for a vendor to exclude liability for indirect and consequential loss, I have seen several legal technology contracts that try to exclude all forms of loss and/or have very low liability caps.

It’s common for a vendor and customer to agree that the vendor has unlimited liability (or at least higher liability caps) for all forms of loss for breaches of data, privacy and security as well as the standard carve-outs for beaches of confidentiality, infringement of a third party’s intellectual property rights or a wilful breach. However, typically a vendor’s initial position is that liability for these events is subject to the general liability cap, not an unlimited or "super" cap, which has to be negotiated.

Procuring technology for law firms requires careful evaluation and planning. By identifying your needs, evaluating the technology options, considering integration and security, planning for training and adoption, evaluating the vendor and entering into a suitable contract, you can select the right technology solution to improve your law firm’s efficiency and provide better service to clients.

This article was first published in LawNews