Amazon law and innovation take center stage at Legal Geek’s Uncertain Decade summit

What do you enjoy about your Amazon experience? Likely everything. The company’s success is derived from a few simple words of company CEO Jeff Bezos’ ethos: “Delight your customers.”

Yet, when you think about innovation, what does that look like inside a law firm? To be honest, it’s probably very different than perhaps it should look. These were the headline topics of discussion at last week’s Legal Geek Uncertain Decade Summit held virtually with Mark Cohen, Executive Chairman of the Digital Legal Exchange, and Richard Susskind, President of the Society for Computers and Law. In their respective lectures, they laid out in stark fashion where they believe law firms are missing the mark on innovation for their clients.

As was artfully illustrated by Cohen in the first of the two talks, Amazon is a corporate conquistador whose North Star is its customers. His premise is that law could learn a great deal from Amazon, and one day be as much of a disrupting force as the Seattle colossus.

What Cohen suggests the legal industry do, is think more like Bezos. While technology is a core component to the company, it is only an enabler. Where Amazon excels is with data. That means, law firms must get to know their clients much better, in order to delight them, Cohen explains, and that means everything must be measured. “You need to know your customers better than yourself,” he adds.

Unfortunately, very few law firms are operating under this ideal, according to Cohen.

If you think about the entire beginning-to-end process of engaging with that client, can you anticipate how they may feel through each gate? “It’s about what happens when they buy something,” Cohen states. “It’s how they buy something, what they want, and when they want it.” Ultimately, it is an end-to-end customer experience, and tech is an enabler to make it happen.

And Cohen did warn — if you read the clouds forming on the horizon — that Amazon law could enter into the legal industry, noting the company’s early inroads into legal with its IP Accelerator, a trademark registration arm that automates IP registrations for people and or companies. Cohen also mentioned Amazon Marketplace, where legal technology companies can add their wares to a legal app store to be downloaded and used. That means that even though Amazon isn’t involved in the practice of law, it is integrating into this space by enabling legal technology as part of delighting customers.

Legal Geek

In the second section of their talk, Susskind takes law firms to task on innovation, saying many of them have overpromised and underdelivered. Over the last five years, lawyers have spoken a lot about innovation, he said, but it was often vague as to what that meant. For some firms, innovation means process improvement, for others it means transformation, and for yet others it means marketing.

Susskind outlined 10 features that separate law firms on innovation, placing them in two different camps — second-generation innovation firms that baked innovation into their planning; and first-generation innovation firms that just want “quick wins”.

Here, according to Susskind, is what second-generation firms are doing:

1. Process improvement first, rather than new business models — Often law firms are thinking of innovation as “process improvement”, but that is not enough. Firms need to think bigger and ask themselves, “How might we reinvent the business model to delight our customers?”

2. Marketing noise rather than progress — One of the most popular first-generation innovation models is the marketing bullhorn. Many law firms still churn out noisy press releases declaring various “process improvements” as innovation. However, if you pull back the layers, “there isn’t much there,” says Susskind, adding that the focus should be on real innovation, with major steps forward in re-examining their business model.

3. Automation v. transformation — Automation is certainly popular and important, but transformation is even more critical. In the second-generation mindset, the lens is on the long-term vision for the firm — and that’s better for the firm and its clients. With second-generation innovation, the goal is to transform the business and the practice of law.

4. Pilot programs rather than fully operational systems — Pilot programs are playgrounds to learn, even if many of these pilots never make it beyond the jungle gym. And while that is naturally the case with pilots, Susskind emphasizes that second-generation innovation firms push to go beyond the playground. On this new plain, the goal is to learn and create new fully operational systems.

5. Little impact on figures as compared to serious revenue profits — Another concept Susskind discusses is the idea that innovation will have little impact on returns. Attorneys tend to believe revenue generated from innovation is inconsequential. Yet, if an organization pursues the second-generation path, there can and will be serious revenue profits from these new approaches if they’re done thoughtfully.

6. Arguments v. evidence — Many firms are still in the mindset that they can argue for or against the importance of innovation. Indeed, there are many firms that argue against it. Instead, the focus should be using evidence to support the case for innovation, and that evidence is all around us. However, it needs to be uncovered, cited, and then used to support innovative movements inside the organization.

7. Minority of partners involved rather than majority — In the early stages of innovation, it is usually the stakeholders that support it, Susskind says, but that is not always enough. When a firm sees the majority of partners actually buy in, that is when the real innovation takes place. Firms need a collective majority.

8. Intellectual grasp, rather than emotional grasp — In a very relatable narrative, Susskind talks about stakeholders who “get it” intellectually, but again, that is not enough. As he physically pounded his chest with his fist, Susskind says he knows when firms “get it” because that’s when they get emotional about it. You can see that firms leaders feel it in their guts and understand the importance of innovation at its very core. Then they will make sure it is the lifeblood of the organization.

9. Avoiding competitive disadvantage rather than seeking competitive advantage — In first-generation innovation, firms are generally attempting to hold their own against their competition, Susskind describes. They simply try to emphasis preservation, such as asking, “How can we stay alive in this pitch?” Second-generation innovation means firms are thinking differently, and asking “How can we steal the business from our competition?” The latter is far more aggressive as a result of baked-in firm innovation that came from long-term planning.

10. Preference for short-term ‘tactical’ v. long-term ‘strategy’ — Most of the firms that are just wrapping their arms around innovation still think in the short term and tend to be more tactical. Instead, firms should be thinking of how they can think differently along a decade-long strategy rather than a year-to-year outlook that’s focused mainly on profits per partner.

Cohen summarized the landscape in regard to innovation within the legal industry. “We are at the foothills now, and our clients are scaling the mountain.” Both Susskind and Cohen agree that most law firms are lagging behind where they should be in transforming themselves through innovation. And they feel that the Amazon ethos of delighting your customers should be emblazoned on the border bezel of every attorney’s computer.

Indeed, the acceleration of change is only increasing, and law firms face increasing competition from alternative legal service providers (ASLPs), and the Big Four consulting companies. Clearly, the clock is ticking.

“Don’t wait to change your model when you get pressure to do so by your competition,” Susskind warns. “It will be too late.”

Legal technology conference (r)evolution—the launch of Legal Geek North America

Originally published in Legal Insights Europe.

By Joseph Raczynski

Like the legal industry itself, legal technology conferences are transforming and Legal Geek is leading the change. These industry events are finally beginning to mirror the, more, customer centric start-up community perspective. Taking a step back, a decade ago the most renown and popular legal industry conferences in the US included International Legal Technology Association (ILTA), now ILTACON, and LegalTech now rebranded Legalweek. Both conferences have established a forum by ushering in a global audience for multi-day events centred on a mixture of vendor products and industry specific legal technology discussions. LegalWeek itself is a spectacle with hundreds of vendors vying for compact, tightly knit cubicals in a midtown New York City hotel in the middle of January. ILTACON, a mega conference, roams from city to city each year in late August with a five-day event in some of the largest hotels in the US. While the original intent was to educate, the creep of vendors and suppliers into the space may have watered down the primary mission. With the recent upheaval at ILTA and their executive leadership, one can almost sense the tug and pull of the shift in focus.

As all things evolve, hopefully, the next iteration of this evolution is the British Legal Technology Forum. This conference has mixed up the notion of what a legal conference looks and acts like. With an open mimosa bar in the morning bleeding into a beer fest for the rest of the day, this environment is starkly different than the traditional suit-clad legal technology events. In addition to the social-centric aspect of the one-day event, the British Legal Technology Forum has quicker sessions, sometime only 15 minutes enabling speakers to discuss a specific topic that is tight on scope. Vendor presence is strong at this event, but not as fully emmeshed in the fabric of the event sessions.

Legal Geek, the prime example of the conference revolution, originated in San Francisco in 2015, but gained favour in London—and so made it ‘home base’. This is the latest iteration of collaboration in the legal tech community. Over the last several years Legal Geek London has received rave reviews among legal technologists, consultants, investors, lawyers, and legal students alike. It has built a bit of a cult-like following. The founder, Jimmy Vestbirk, offers perspective on why Legal Geek has such fandom. The philosophy: come to make friends, not to sell; dress comfortably (please, please, no ties); come to learn and to teach; look after your fellow law-gends, you may need their help someday; and, this is your community, please pitch in and help. You will be rewarded. This elicits a mental shift of mindset for all who come to this legal technology event—from the typical conservative, staid legal conference approach—to the hip, cool, cutting-edge vibe of a grass-roots start-up company. There’s even promptings to ‘high-five’ your fellow delegates throughout the day.

Recently I attended the first Legal Geek North America in Brooklyn, New York. There was a buzz about this event weeks prior. Attendance reach over capacity with 450 people from around the world. A waiting list of dozens were reported—and understandable with an enterprising agenda of 60 presenters, from six different countries, speaking between 8-12 minutes each—and only three vendors present. The speaker line-up was geared to technologists and lawyers, from both private practice and in-house—on what legal technology is out there and why it matters.

This event had potential to be an earthquake event in the industry. The biggest difference at this conference, presenters are not supposed to talk about their products, at least until the very end of their 10-minute spiel. It was effective.

Highlights

Blockchain for non-disclosure agreements (NDAs): Jim Brock, CEO of TrustBot, is working on creating a tool that creates NDAs very quickly through a document automation system. Its primary goal is to solve for the problem for the user accepting the agreement. Anyone can adopt the agreement, then you share the URL. Each party is adopting the NDA prospectively—so that when you agree to it, anyone else who has already agreed to it is already set. You are accepting the ‘hash’ or the signature stored on a blockchain. This is all verifiable.

Access to Justice: Stevie Ghiassi, CEO of Legaler, is endeavoring to help legal services reach 1 billion people. Through the use of all of the latest buzz words—digital scarcity, smart contracts, programable value, internet of value, digital identity—Legaler is creating a blockchain operating system for legal services. One component of this is LegalAid—you can donate money to this fund using a blockchain and see who the money goes to using a smart contract. This enables the tracking of your donation and you can see how it impacts an individual’s life. Another aspect of the operating system is a Litigation Fund which pools people’s money together, raising money for a group of people who want to sue a mega company in a class action suit.

Distributed Law Firm: James M. Fisher II, Founder & Managing Partner of FisherBroyles, LLP has created the first distributed law firm in the world. It has just cracked the AmLaw 200. Their platform is based on compensation, people, location, and technology. They use smart contracts on a distributed network where all partners can see how everyone is billing, it’s automated and in the clear. Partners get 80 percent of all billable work for their clients. If you work with another partner, you receive 48 percent of the earnings. The cost savings comes from having no physical office space as every partner is geographically distributed as well. Their people join the programme from some of the biggest firms in the world with the attraction of no commutes, no overhead, increased professional growth potential, and an extremely diverse partnership. Lastly, their technology is a mix of both cutting edge and traditional tools to help their clients.   

Legal Geek North America, still in its infancy, is primed to shake up the legal technology community. The shortened sessions and its focus on the customers and not product is something to watch for the next several years. Likely the North American event will soon rival the mega-success of the Legal Geek Conference in London.