The profound changes happening in the global economy, the intensifying political-world uncertainties, the rising strength of the Asia-Pacific region, and the unstoppable metamorphosis of technology is undeniably disrupting how things work in the market. Advances in information technology and telecommunications are affecting the global market including the entire sectors, not sparing even the most tradition-bound legal industry.
The legal landscape is being reshaped in ways that not everyone in the profession is ready to accept while some are even threatened. The emergence of low-cost and low-skilled labour offerings and offshore business opportunities are competing glaringly. The rising transnational legal marketplace is putting pressure both in large and small firms; matter-of-factly it is intimidating the entire profession. This revolution is testing how the legal industry will evolve and survive.
The ongoing trends that are stretching the legal industry includes but not limited to: process automation, the insurgence of flexible working arrangements, the introduction of alternative legal service providers, more niche practices and specialisation, promotion of alternative billing models, and business development skills.
The future of large and established law firms
The future of the legal services market definitely won’t be bright on the side of complacency and maintaining the status quo. It is important for legal professionals, especially large and established law firms to recognise what needs to be change and eliminate idiosyncrasies which prevents innovation. Large legal firms should no longer solely depend on tradition and precedent.
Traditional way of doing business in the legal sector will definitely be ruptured in the future as new technologies emerge and the clients becoming more demanding. Indeed, what’s ahead is a disruption so the need for large law firms to adapt the soonest possible is an utmost necessity in order to survive.
The idea of “disruptive innovation” is built on the impact of technological innovation, which is an ultimate game-changer on the market today. However, technology isn’t the only player that’s driving rapid changes, but the business model itself and existing general issues. Let’s look at some of the factors that’s revolutionizing the industry:
- Changing business structures and the convergence of services. Legal services market is no longer monopolized by law firms as more and more clients seek affordability and convenience therefore opening the door for multidisciplinary services to be offered. The accounting and investment industries for example, are attracting clients by creating the impression of one-stop services.
- Offshoring. Globalisation and liberalisation of markets contributed to the increase of demand for different type of legal services. The advances in technology greatly contributed to the rising interest in offshore opportunities.
- Legal process outsourcing. Outsourcing is one of the popular trends affecting the legal industry nowadays. Services like legal research, document review, drafting of pleadings, paralegal work, etc., can now be easily outsourced.
- Demand for billing alternatives. Most clients no longer patronize time-based billing, consequently creating the demand for billing alternatives such as fixed-priced and unbundled services.
- Cloud computing. The traditional way of maintaining data and documents is now being replaced by cloud computing. The ability to access and store data easily on the internet is not only promoting convenience, but also reducing costs.
- Artificial Intelligence. Currently, there’s already a pool of IA programs performing tasks usually done by legal practitioners and law grads. Ongoing arguments suggest that AI may cause structural collapse while others view the use of AI as a promising tool to increase productivity and profits.
- The existence of Virtual Law Firms. A new form of legal practice exist with the aid of virtual environment and associated technology. Virtual law firms are increasingly becoming more attractive to clients as they provide more flexibility in terms of service delivery and cost.
- Self-help websites. Simple legal concerns may now be addressed for free simply by accessing websites that publish free content as well as legal forms and documents for the general public.
- Electronic Courtrooms. Electronic courts are now being used in Australia which dramatically enhanced the speed, search capability, access and management of court documents.
- Social Media Marketing. Some law firms and legal professionals are taking advantage of Social Media to network, advertise services, raise awareness, and educate the public of their existence.
The future of large law firms and established legal professionals now depend on their ability to adapt to these changes, accepting that disruption has arrived, as well as the willingness to expand their knowledge and skills so as to remain competent.
The effect of new disruptive marketing on legal firms
Law firms are being called to reinvent in order to survive and thrive instead of heading to extinction. The new disruptive marketing is causing law firms to adapt as quickly as possible and re-evaluate business goals and client relationships. It’s sending an alarm to law firms to keep its lifeblood pumping by developing new marketing strategies, upskilling its workforce, and investing in new technologies.
Law firms who choose to remain complacent will eventually suffer death. However, firms who actively responds to business development and innovating marketing strategies are likely to stay alive and on top of the game. It’s a win-or-die situation now.