The end of the 14th largest law firm in Scotland
A talk on 'Lawyers and Social Media' emphasising the importance of personal branding for young lawyers which can and should start whilst still law students.
I and others have been writing on this Blog of late about the Legal IT curve. My view was that Big Law is so behind the legal IT curve and this could be detrimental to its future. However, this past week a New Law firm, Clearspire, who, on the face of it, was well ahead on that legal IT curve closed its doors. Why it folded is not clear.
— Patrick Ellis (@pmellis) June 6, 2014
One reason could be its spend on legal IT.
It would appear that this spend was $5 million and involved two and a half years of research and development. For a law firm with 25 lawyers that is $200,000 per lawyer spent on IT. The aspirations of Clearspire were much greater than a firm of 25 lawyers. In January 2013 the stated aim was to “expand its nontraditional legal services model across the country with the addition of 50 to 100 former BigLaw lawyers each year for the next five years”. That didn’t happen. If it had then the spend per lawyer on legal IT would have gone down considerably from that $200,000 figure.
However, $5 million seems one heck of a lot of money for any law firm (especially a new start) to be spending on legal IT. What was special about this IT? I have not been able to glean a lot about its USP if it even had one. I found an article that suggested CORAL, the system developed by Clearspire, provided a “highly secure technology platform to collaborate real time with clients and team members, post questions, review briefs, and more”. Perhaps we need to know what the “and more” is as everything else can already be done with off the shelf platforms at a fraction of the cost. As Carolyn Elefant said in a comment to that article:-
What is so revolutionary about Clearspire? I have been implementing flat fees, client plans and online secure portals for at least a decade as have many of my solo and small firm colleagues.
It has been suggested that CORAL did not even assist document management!
@AlexHamiltonRad They had no interest in document assembly, so not sure how “NewLaw” they really were.
— Ken Adams (@KonciseD) June 5, 2014
The Clearspire business model which involved amongst other things “no central physical office, but regional centres and a powerful ‘best-in-class enterprise IT platform'” is one being played out by other NewLaw firms but perhaps with substantially less spend on the IT element. With legal IT providers having invested huge sums in perfecting proven legal IT systems over the years is there really any need for a NewLaw firm to reinvent the wheel?
Such systems (especially the cloud based ones) can now be purchased on an affordable per user basis allowing the IT to grow as the law firm grows rather than the IT having to pay for itself once the law firm reaches a critical mass, which seems to have been the Clearspire model. What law firms need to spend time and money on is making sure these off the shelf systems are working to their full potential within their own four walls (even if that is virtual walls).
So in my view Clearspire may have got it wrong with the huge investment in its own legal IT system. It is not the start of the end of NewLaw but perhaps a lesson for would be NewLaw firms. Law Firms survive on providing legal services to customers (aka clients). Law firms, new or old, need to concentrate on that. Technology is a tool to assist that process. When setting up a law firm I wouldn’t try to create a PC or phone from scratch. Pier Giorgio Perotto and Alexander Graham Bell beat me to it. The same is true of legal IT systems. There are plenty out there that work very well indeed. Usually it is the law firms or individual lawyers within those law firms that are simply not using the systems anywhere near to their full potential.
— Mitch Kowalski (@MEKowalski) June 6, 2014
Arising from the Clearspire ashes appears to be CORAL. The law firm has gone but the legal IT will live on. As Mitchell Kowalski states:-
So, while some will mourn the loss of a New Law trail blazer, the fact that Clearspire will remain as a legal IT company and grow, bodes well for lawyers across the world.
Perhaps. But what is unique about CORAL? If it didn’t sustain the pilot NewLaw firm Clearspire does it really bode well for lawyers across the world? I am told we will will find out at the end of the Summer.
The Clearspire website tells us:-
Our law firm was a laboratory– a proof of concept that demonstrated just how innovative today’s lawyers can be. In the process, we redefined client satisfaction, lawyer efficiency, and pioneered the model for the future of legal services delivery.
Now, the time has come to scale. We’re taking Clearspire to the next level with a mission to empower not a law firm, but all law firms.
We are actively working to ready our class-leading Legal Services Delivery Platform for you! Stay tuned to these pages in the coming weeks and months for updates on our global deployment of The Next Revolution.
If it didn’t empower one law firm how will it empower all law firms? But perhaps ‘The Next Revolution’ will have a price tag less than $200,000 per lawyer
I have made assumptions in this post. I had to as there is no information yet from the horse’s mouth as to why Clearspire folded. I may be wrong. Whether I am or am not do you think law firms should create their own legal IT systems from scratch rather than buy in existing third party ones?
NB: This post is part of a series of blog posts on the Legal IT curve. See also:-
The truth is that lawyers are trying to reinvent themselves into something they will never be instead of improving on what they actually are.
The premise of my talk is that you might be able to reinvent your law firm by improving it a bit at a time. I will look at real life examples from my own law firm, Inksters, in the presentation.
This will be stuff from the coal face that I think is often missing from legal futurist and technology conferences where the focus tends to be on star gazing to 2034 rather than what can actually happen today.
A quick look at the 24 speakers announced so far suggests that perhaps only 4 are practicing lawyers and I think I might be the only UK based one of those.
I have long been a campaigner for Scott Greenfield to be invited to talk at a Reinvent Law Conference.
— Scott Greenfield (@ScottGreenfield) April 10, 2014
Looks like that day has yet to come.
— Scott Greenfield (@ScottGreenfield) May 9, 2014
I will see what I can do without Scott on 20 June. Whether I dance solo remains to be seen! Book your free ticket (or give a donation when you do so) to the event now to find out: Reinvent Law London 2014 Tickets
Guest Post by Ben Wightwick
Firstly, thank you to Brian for inviting me to write a guest post as part of the Legal IT curve series. I was asked to contribute to provide the perspective of a legal IT vendor. Before I start, I must clarify that I am blending my vendor hat with one that has just under 10 years experience in an IT department at a “big law” firm in London. HighQ, the company I now work for, has been selling “cloud” and progressive enterprise cloud collaboration tools and solutions to law firms for the last decade.
First of all I’d like to say that I’m of the opinion that it doesn’t matter what type of law firm you work for or how you classify it. It’s bigger than that. I think all firms, businesses and organisations inside and outside of the legal vertical face very similar challenges. On the flip side of that same coin, all organisations have the same opportunities. These challenges and opportunities come at a time when technology is changing and influencing our personal lives while leaving a bitter taste within the enterprise. Not 10 years ago it was only within the enterprise that we had access the latest software and devices. It was the enterprise where we saw the most innovation. This has changed forever – you can’t put the genie back in the bottle. I now have access to more innovation in my pocket via my smartphone than most enterprise software applications. Enterprise software has become stale, and this is not unique to legal.
According to Ray Wang of Constellation Research, “in the shift toward dominating digital disruption, CIOs can only move as fast as their organization’s DNA will allow while driving transformation.” When we review that statement and apply it to a law firm dynamic we come up against the single most important factor in the law firm technology debate: law firms are and always will be risk averse. As Ray puts it, it’s in their DNA. Just look at the technology adoption lifecycle which quotes five phases of adopters:
Innovators – – Early Adopters – – Early Majority – – Late Majority – – Laggards
In almost all instances, law firms will be in the Late Majority or Laggard phases of technology adoption. This is because many or most are resistant to change as written by Larry Bridgesmith. There are of course, people, teams and entire firms outside of these two categories but by and large it’s an accurate assessment. A risk averse stance will, in my mind, delay law firms (large and small) from progressing and moving forward. It could mean they miss opportunities and expose themselves to greater long term risks associated with survival.
Law firms need to be more agile. Whilst some manage this, the majority have focused on infrastructure and keeping the lights on while doing little to influence or transform the business. There have obviously been reasons for this. Many CIOs’ budgets have been cut in the last five years, even in “big law”. Arguably this has prevented innovation or an attempt at early mainstream adoption of technologies, ultimately firms have had to make do. There has been a wide spread consolidation of the market in the form of mergers and experiments with outsourcing. This all contributes to a lack of tangible forward motion in technological advancement.
Of course there are great examples of law firms using technology to drive efficiency and productivity. Those firms who are looking at technology as an enabler are making the charge forward. Those who are driving forward look at their assets and assess each based on what they can do today and on their potential to deliver in the future. This is all common sense, but many either don’t have the time to focus on it or focus on other more “important” things. Law firms of any size need technology to be simple and scalable. When you talk about adoption you should be aiming for limited IT involvement or training. This, I feel, is the primary role of the future CIO.
Currently there are, broadly speaking, four types of CIOs: Chief Integration Officer; Chief Innovation Officer; Chief Infrastructure Officer and Chief Intelligence Officer. All CIOs will fall into one of these main camps. Many will be more than competent in the rest, but they each have a natural alignment. Many in legal are not able to focus on innovation for reasons given above, but the future needs of the workforce will ultimately become a priority. Gartner talks about the transition from CIO to Chief Digital Officer (CDO) and predicts that 25% of organisations will create such a role. I can see this being a long way off within legal but very valid, the merging of roles and perception of the traditional functions in a law firm. The current CIO role will primarily be keeping the lights on and the CDO will be more strategic, aligned with revenue and client success and retention.
In my opinion it doesn’t depend on your business model or your size. Of course it might be easier to be more agile in a smaller more nimble firm but it also depends on whether your management team see technology as an enabler not a cost centre. It also depends on whether they can see beyond legal technology, and whether they value the human network of the organisation and want to allow it to thrive.
So what is the current state of play in legal IT in “big law”? Investment in technology within law firms up to around 2008/9 was largely internally focused. Focused on the business. There are rafts of legal specific applications from practice management systems to document management platforms and search tools. Almost all the Top 200 law firms have something or other in the majority of the categories (as seen in the LegalIT Insider Top 200 UK charts). But what this chart doesn’t tell us is how well are these products adopted? How well are they aligned to business processes? Has benefits realisation been a core part of project delivery? Are lawyers using them or are they bypassing them? Has business services requirements been included? How much shadow IT is being used? These are all questions to which many will have similar answers, I bet.
Taking risks is an important part of running a business. You will always fail. It’s amazing how quickly you can recover and learn from those failures and jump back on the horse if you are prepared to fail. I was at a legal marketing conference last week where the keynote speaker was Kat Cole and she talked about failure, taking risks, making hard decisions for the survival and ultimate success of her business Cinnabon.
Law firms are going to have to take some risks, this is inevitable. Many are under pressure from the wider market, changes in business structures, and client demands. Not exploring other ways of doing things because “we’ve always done it like this and look where it’s got us” is almost negligent. It doesn’t matter whether you categorise these factors affecting your business as challenges or opportunities or both. People, teams and firms need to realise they aren’t just delivering “tech”, they are potentially delivering a change enabler. It’s important to understand and focus on the impact of technology on the business and its employees (not just lawyers) and provide just as much emphasis on the people using the technology. The day this happens, we’ll be moving in the right direction.
Technology with a focus on the human network is the key, which allow greater innovation and enable wide change. A digitally proficient workforce (not millenials), the right culture and open approach to risk and innovation will drive the new ways of working.
Law firms like many other organisations are risk averse and are resistant to change, this resistance to change is ultimately a risk in itself to which some may not survive. Each firm has to focus on it’s people and is in control of it’s own ability to change and adapt. It’s up to them.
Ben is client focused and enjoys working closely with clients and colleagues to ensure the successful delivery of technology solutions which help clients derive the most value from their investment in HighQ software.
Ben has many different roles and is involved in many areas of the business including; writing, speaking, consulting, marketing, social media presence, defining strategy and other areas of general business improvement.
Ben’s primary role however is “Product director” of HighQ Publisher. This includes managing all aspects of the product from; managing new and existing clients, designing new functionality, project implementations and innovation for the future of the platform.
Main Picture Credit: Iain Mackay
NB: This post is part of a series of blog posts on the Legal IT curve. See also:-
Yesterday was LawTech Futures 2014 – The Future of Legal Technology (Europe’s largest legal technology event). The last two years I was invited to attend, went and wrote reviews: LawTech Futures 2012 Reviewed: The Search for the Holy Grail of Legal Technology Conferences has Begun! and LawTech Futures 2013 Reviewed: The one with the neocortex. This year I must have fallen off the invite list. So no review I am afraid but just a few comments generated via Twitter from this side of Hadrian’s Wall.
Legal Conferences (especially Futuristic / Technology ones) are usually well covered these days on Twitter. Indeed sometimes you can glean as much about the Conference from Twitter as actually being there e.g. LawTech Camp London 2012: In Tweets.
That was, unfortunately, not to be the case yesterday. There were quite a few tweets from vendors telling you to come to their stalls for free giveaways. Riverview Law, Jeremy Hopkin’s daughter and I have a particular penchant for flashing green bouncy balls (sorry… an in-joke from last year). But there were very few tweets about the actual content of the Conference. Indeed the official Conference Twitter account could only muster four and those were just about the venue filling up. I was left not knowing what the future of legal technology holds. It was the keynote by Sir Tim Berners Lee that got most tweet coverage. We found out in particular that:-
But then that had already been predicted by Jon Busby on Twitter last week:-
@ChristianUncut i think i know the answer…he’s remove ‘//‘
— Jon Busby (@jonb1966) March 19, 2014
So Twitter at least told us what was going to happen at the Conference before it did. Maybe just as well I hadn’t made the trip to London this year to find that out. Although Jon Busby tells me that Sir Tim’s http regret was widely publicised elsewhere and he picked it up in Wired last month. Other startling insights on the world wide web included:-
— Charles Christian (@ChristianUncut) March 25, 2014
Why so little LawTech Futures Conference Tweets this year? I tweeted with Jason Plant about that:-
@planty was there perhaps less to tweet about? Sir Tim seemed to be the main topic of tweets – but not much there I could see for legal?
— The Time Blawg (@TheTimeBlawg) March 25, 2014
@TheTimeBlawg you could be right. There was less on the main stage this year and the lounge stage smaller bit busier
— Jason Plant (@planty) March 25, 2014
@planty … of course my absence this year would have reduced the tweet count dramatically
— The Time Blawg (@TheTimeBlawg) March 25, 2014
So very little in the way of tablets, smart phones and tweets at a legal technology conference. I can only deduce that the audience was therefore dominated by Big Law (and if Eversheds attended they left their iPads at home). Big Law does, of course, need to attend these conferences because Big Law is so behind the Legal IT curve
On the Legal IT curve debate see also:-
Photo Credit: Yasmin Andrews
I attended the annual Law Society of Scotland Dinner at the National Museum of Scotland in Edinburgh last night. Law Society President, Bruce Beveridge, joked of lawyers gathering amongst dinosaurs, fossils and sharks. It was a magnificent setting for what was a thoroughly enjoyable evening. The dinner was excellent as was the after dinner talk by Hamish Taylor. A talk that encouraged law firms to steal. Not from their clients I hasten to add. But to steal ideas from businesses outwith the legal sector.
Hamish Taylor has a winning record of driving innovation and change at companies such as Proctor & Gamble, British Airways, Eurostar and Sainsbury’s Bank. Hamish has been dubbed the “master thief” by the Inspired Leaders Network for his track record of stealing ideas from one environment to use in another. He gave examples of going to a luxury yacht manufacturer to design the flat beds in First Class at British Airways and asking Disney to sort out the queueing system at Heathrow Airport.
The message was to look outside the legal sector and see what ideas you can steal from other businesses to use within your own law firm. Sage advice. When I set up a visiting base in Shetland for solicitors from my own law firm, Inksters, to work out of, I stole from the serviced apartment industry (e.g. Fraser Suites) and the serviced office industry (e.g. Regus) combined the two and created OfficeLodge. We won an Innovation award for it in 2007.
I wonder if there are many examples in actual practice of law firms stealing ideas from other sectors?
Picture Credit and link: Venue Hire at The National Museum of Scotland
Nicole Black has referenced my post on Big Law is so behind the legal IT curve in her post for Legal IT Professionals on Why large law firms face extinction by irrelevancy. Nicole states:-
For some time now, I have encouraged law firms to embrace change or pay the price of irrelevancy. It’s been my contention that because of the wide scale proliferation of mobile and cloud computing, 21st century legal consumers expect more from their legal counsel than ever before. They are used to instantaneous access to information and are more discriminating and demanding. They seek affordable, convenient, 24/7 access to legal representation using the latest technologies.
Nicole is of the view that law firms need to pivot with the changing times to succeed:-
When it comes to pivoting, large law firms seem destined to fail since, by their very nature, they are: 1) large, 2) precedent-based, and 3) run by lawyers. As a result, large firms are slow to change and cling to doing things the way they have always been done. I base this conclusion on 2 things: conversations with IT representatives from large firms and survey results regarding large law firms’ use of emerging technologies such as cloud and mobile computing.
Nicole makes reference to me stating that Big Law has invested heavily in non-cloud based technology and needs to “sweat their expensive IT investments” before they can justify a move to the cloud:-
And therein lies the problem – large law firms are too invested in legacy systems of the past and are thus too big and clunky to pivot. Not to mention the fact that their in-house IT staff have no incentive to encourage change. To do so would mean the loss of many of their current job functions.
So for now, the game plan for large firms seems to be to stick to the status quo. Let’s just hope their decision to change at a snail’s pace doesn’t lead them down the same path as the dinosaurs. Because when it comes right down to it, pivoting, while sometimes a painful process, is far better than extinction by irrelevancy.
Nicole’s post has caused quite a reaction as can be seen from the stream of comments generated. Big Law I reckon don’t like being compared to the dinosaurs. I would like to take a look at some of those comments.
Rob W (the first one) – there are two in the debate – states:-
Any law firm, or other serious business concern for that matter, that uses public cloud is foolish. There is too much threat to the security of confidential data from the NSA, USA PATRIOT Act, British Intelligence, etc.
Rob W (a different one) – there are as I said two in the debate – states:-
I don’t think anyone would argue that Cloud is compelling as a next-generation platform, but most of it is in no way ready for the complexities of today’s law firm when a needs assessment is properly completed.
So there are security issues, law firms are complex and the cloud is not ready yet for those complexities. I am unsure what those complexities are. Rob W (a different one) does not elaborate. I accept that services such as Dropbox and public cloud offerings from Google, Amazon or the like are not suitable for law firm usage. Indeed law firms in the UK cannot by law use such services as the cloud servers involved are not necessarily located in the European Union. But that is not what Nicole or I are talking about. We both know that there are specialist service providers out there with tailored cloud solutions for law firms that meet stringent legal and security requirements. If law firms talk to the right people they can have a cloud solution now that ticks all the boxes in any needs assessment. And those right people are certainly not the ‘snake-oil salesmen’ that David Edwards makes reference to. Law firms implementing such a cloud solution are likely to find their data is more secure than it would be if held within their own office walls.
Doug Carner states:-
Cloud computing is a tool, not a destination. Before embracing any technology, one must evaluate the costs and benefits, and not just with regards to money and information security. While good, the article did not adequately detail how the cloud would provide better service to the client and/or greater efficiency for the firm, versus their current use of a VPN and centralized file servers.
Disseminating such information was not the purpose of Nicole’s article. Such information can easily be found elsewhere and was probably taken by Nicole as already read. I covered many of these issues in 2011 in Law Firm in the Cloud.
Roy Allen/Lawgistics should perhaps also read my blog post from 2011. If he does it might not be as simple to him as:-
This magical “cloud” that makes all things better does not exist. All the cloud does is move the servers somewhere else.
how attorneys would, for example, perform document reviews which are done using very specific types of applications in the cloud, review transcriptions, enter time, etc.???
The answer is simple. These tasks can all be done in the cloud. I do them. If you can do it on a server in your office you can do it in the cloud. If your legal software provider can’t move you into the cloud it is time to consider an alternative provider as your IT people may just be cavemen (to maintain Nicole’s dinosaur analogy!).
LC also thinks that the cloud can’t work globally where you have law firm’s operating in different jurisdictions with different levels of security requirements e.g. the EU is higher in its requirements than the USA. This is something I have not had to give much thought to as my law firm, Inksters, is based within Scotland and subject only to the regulations of the Law Society of Scotland. Our cloud solution is based within the UK and complies with EU regulations. I would have assumed, although I may well be wrong and I have not researched this point, that if you were a global law firm you could house your cloud servers in the jurisdiction with the highest security requirements and that would satisfy those with the lower ones. I stand to be corrected on this if my view is too simplistic.
The bottom line from Nuno Brito Lopes is:-
Do not let evolution make you lose sight of the defining features of being a Lawyer.
Being a Lawyer and using technology to fulfil that function in better and more efficient ways are two different things. I fully agree that technology will not necessarily make you a better lawyer but you may well serve your clients better by embracing it. You may also evolve yourself and not face extinction.
John Mancini thinks that:-
Most successful big firms, and there are a lot of them, are successful because of their deep bench of talent. Good lawyering trumps cloud architecture any day of the week.
Small Law firms, Boutique Law Firms and NewLaw firms do not lack legal talent. This is one thing they share with Big Law firms, a fact brought out by George Beaton in NewLaw New Rules. Good lawyering coupled with state of the art agile legal IT will trump good lawyering coupled with prehistoric (keeping up Nicole’s dinosaur analogy!) legal IT any day of the week.
The thing that strikes me most when reading through the negative comments that Nicole received is that Richard Susskind was right. Many lawyers (and Richard has commented that this is a trait particularly common in large law firms) are irrational rejectionists. They reject ideas before giving them a chance. They possibly, for that reason, do indeed face the fate of the dinosaurs.
NB: This post is part of a series of blog posts on the Legal IT curve. See also:-
I will take exception to one of the things [Brian Inkster] said, “There is an acknowledgement that the cloud makes NewLaw ‘as agile, if not more agile, than Big Law’. I think much more agile.” It does not. Agility has little to do with the platform, and much to do with how you use it. There are agile firms who use premise equipment. There are awkward/sluggish/lethargic/stiff/clumsy firms using the cloud. People, process, work flows – these are where your agility is created. Choosing only the technology will fail every time.
I agree. However, the point being made originally in Briefing Magazine’s Legal Technology in 2014 (which I quoted only part of) was really emphasising the fact that, via the Cloud, NewLaw now has access to enterprise level technology that once was the preserve of BigLaw. This gives them, perhaps more correctly, the ability to be agile using such technology in a way that was not previously available to them. the same is true of Small Law of course. It also gives them the many advantages (often ones of agility) over office based Legal IT that I outlined when my own law firm, Inksters, moved into the Cloud. Some of these do come with simply being in the Cloud. But yes… agility will be increased substantially with how you then use your cloud platform. I rather think that NewLaw is tuned into this fact and may well be more agile in implementing that use than Big Law There will, however, no doubt be “awkward/sluggish/lethargic/stiff/clumsy firms” using the cloud just as there are and will continue to be “awkward/sluggish/lethargic/stiff/clumsy firms” using systems located within their own offices.
Paul Caris, CIO of Eversheds, said in the Briefing Interview that I was quoting from:-
The management and managers of law firms need to look at how they are going to compete when the technical competitive edge is gone, and when all [legal businesses, new and old,] are on a level playing field.
In my opinion it may not be a level playing field that the future holds but one where proactive cloud adoption and agile use thereof by NewLaw has left Big Law well behind the Legal IT curve and less able to compete with them.
NB: This post is part of a series of blog posts on the Legal IT curve. See also:-