By Tim Rollins
At first glance, some of the key findings in the 2021 Legal Technology Report for In-House Counsel might seem discouraging to members of legal teams at mid-market companies that haven’t invested in technology already.
97% of respondents say technology is a must have or nice to have
90% of respondents at companies with mature legal operations say it’s a must have
Almost ⅔ of mature companies (who already have well-developed LegalTech stacks) plan to invest more in legal technology in the next year
It’s easy to think to come to the conclusion: “We’re behind in the race. We’re never going to catch up. It’s a lost cause.” But that attitude is unnecessarily defeatist. There is a clear path forward, and it starts with understanding the advantages mid-market companies have in purchasing and implementing technology.
Why Mid-Market Companies Can Close the Legal Technology Gap
Before digging into the path forward for mid-market companies, what are the facts or data points mitigating the long-term impact of this legal technology gap? The two main ones are the increasing complexity of multi-system legal technology stacks and the ability of smaller companies to move much faster than their enterprise-scale competitors.
Respondents to the ACC survey were asked about the challenges of adopting and implementing legal technology. Their responses reflected frustrations with complex technology environments (39%), software systems that aren't effectively integrated (59%), and confusing, non-intuitive user interfaces (45%). Lack of IT support and data security concerns were far behind with 26% and 20% respectively.
All of these challenges can be effectively addressed by a unified software platform, like Exterro. This holds true both for e-discovery, which can be orchestrated effectively in a single SaaS suite, and for the larger realm of Legal Governance, Risk, and Compliance, which also encompasses Data Privacy and Digital Forensics technologies. Where large enterprises must grapple with these challenges associated with complex technology stacks, mid-market companies investing in legal technology for the first time can choose to address their pain points with elements from a unified platform, then grow with the software suite as necessary.
The second advantage mid-market companies have compared to enterprises is their relative agility. Enterprises report:
- More stakeholders in purchase decisions: Over 50% of enterprises reported buy teams of 6 or more, compared to 70% of mid-market companies having 5 or fewer stakeholders.
- Longer purchase cycles: The median SaaS purchase cycle for enterprises was 6-12 months, where it was 3 - 6 months for smaller companies.
Considering that enterprises most likely also have complicated technology environments that could make implementation periods longer and more complex, mid-market teams can make technology decisions and act on them much faster--and if they're implementing a software suite, rather than a point tool, they could be taking large strides toward optimizing their technology very quickly.
The Legal Technology Road Map for Mid-Market Companies
Now that we've explored why all isn't lost for mid-market companies looking to catch up to enterprises, let's dig into how they should proceed, according to the conversation held in a recent Exterro webinar, The State of Legal Technology 2021, featuring David Yerich, Esq., Director of E-Discovery at UnitedHealth, Brandon Lee, Managing Director at FTI Consulting, and Michael Hamilton, J.D., Vice President of Marketing at Exterro.
Brandon Lee explained that the first step probably shouldn't be investing in technology at all, but in spending the time needed to understand and optimize processes to suit the team in place. He said, "I've always been a huge proponent of organization optimizing the people and their process. So really optimize the internal resource allocations and also the processes before going on a journey to determine the appropriate technology."
He continued, "Less mature organizations have to be a bit more strategic in assessing their technology needs, and they really have to prioritize the processes that are right for technology infusion. So I regularly advise my clients to identify an area where there's consensus agreement that improvement is needed, and then really build a business case. Present that to the stakeholders that have decision-making by an authority. In [presenting the business case], I typically suggest that organization look at kind of three different components. One, identify a pain point process that's either costly to a department or presents a risk. Two, determine a process improvement plan or plan of action or roadmap. And three, identify and vet a list of technologies that can aid in the desired improvement. And four, find and be able to articulate a means of measuring improvement of success."
The key to identifying and quantifying success is to set reasonable, achievable goals. David Yerich explained, "Start small. Start appropriately sized to the trust level, the maturity of the organization, and your actual ability to execute. That way you can build on those successes and it's a lot easier than trying to create this huge business case for this huge implementation that you truly might not be able to pull off."
Start on the road to technology implementation by understanding the landscape of legal technology in the 2021 Legal Technology Report for In-House Counsel.