The internet revolution poses new challenges to lawyers and law firms as they attempt to meet clients' expectations in an increasingly internet-intensive business environment. As the national and international information technology and e-business infrastructure matures, the needs of clients today will be more and more internet-driven and new business models will emerge posing unique challenges to law firms offering legal services. This article shows that not only will new models of service delivery lead to overall improvement in service value, it might also create new revenue streams for the law firms.
Introduction
The internet revolution poses new challenges to lawyers and law firms as they attempt to meet clients' expectations in an increasingly internet-intensive business environment. As the national and international information technology ('IT') and e-business1 infrastructure matures, more and more businesses will go online. The needs of clients today will be more and more internet-driven and new business models will emerge posing unique challenges to law firms offering legal services.
Against this scenario, how should law firms respond to this new challenge? What are the requirements for law firms to service their clients in this changed and changing environment? Law Firms may need to re-think their traditional strategies and begin seriously to focus on new models of 'lawyering' in the internet economy. Such new approaches are not likely to replace the 'traditional' modes of service delivery, which law firms provide to their clients, but will reinforce existing forms of such service delivery. This article aims to show that not only will these new models of service delivery lead to overall improvement in service value, it might also create new revenue streams for the law firms. A new breed of lawyers - as technology providers within law firms, may soon be an entrenched feature in our legal service landscape.
What is an Internet Strategy?
Let us start with the basics. Before a firm starts to design an internet strategy, it must have an existing business strategy. An internet strategy is a sub-set of the law firm's business strategy and it must include a technology component. By technology here, I do not mean the technical information that IT 'techies' love to dwell on. It is more the business application of IT, particularly, an awareness of how technology could be harnessed to benefit the legal practice as a whole. It is about technology exploitation that brings about business value to the practice through greater service value to the law firm's clients.
Equally important, awareness of the technology dimension of providing Web-based legal services requires the legal practice to fully understand the limits of technology. If a law firm and its lawyers do not understand the basics of technology, the design and implementation of the practice's internet strategy is likely to be flawed right from the beginning.
An effective internet strategy is about providing greater service value to the clients. It is not about good-looking websites but about providing a range of useful, secure and innovative internet-based services that the clients would benefit from. Such internet-based services can include basic functions such as making available useful legal information that can be accessed through a Web browser and/or it can be as complex as providing a secure digital space for multi-party legal transactions across different jurisdictions involving internet-based drafting, document management and 'live' case management facilities.
Elements of an Internet Strategy
An effective internet strategy for law firms should at least comprise some, if not all, the following elements:
Goals of an Internet Strategy
What should the goals of a law firm's internet strategy be? I would suggest the following twin goals which should be pursued concurrently or at least in overlapping phases:
Law firms must decide how best they are going to exploit internet technologies for their practice. If internal efficiency and the need to raise productivity take priority over providing Web-based services to their clients, then the design and implementation of the firm's internet strategy must be focused on this. There is no such thing as a 'one-size-fits-all' internet strategy for law firms.
Considerations in Designing an Internet Strategy
At the strategic level (or, some would simply say, the 'higher' level), the review of an internet strategy should provide answers to the following questions:
At the 'operational' level, the questions would in turn revolve around the following issues:
Law firms must incorporate a technology strategy within their overall internet strategy. There is no getting around this. Engaging external consultants may become necessary, even critical, if a law firm does not have the internal capacity to do this.
What Sort of Internet-based Legal Services can Law Firms Offer?
Like services in the 'brick and mortar' world, clients invariably want to feel or at least lawyers would want them to perceive that they are receiving personal attention. After all, quality legal service is about providing sound legal advice and excelling in providing high standards of personal service to the clients. The provision of internet-based legal services is no different in terms of the level of service excellence that law firms must aspire to.
The raison d'être of law firms is the provision of services that would help the clients achieve their goals. This often takes the following forms:
In the virtual internet world, advice can be provided over the internet and agreements may be drafted using the internet too. With some limitations, it is also possible to provide internet-based services to guide clients on particular transactions envisaged in point (c) above. This may come in the form of a legal guidance system.
Client and Transaction Portals
Internet technologies are emerging with increasing sophistication. At the same time, there are more and more 'user-friendly' features and functionalities in websites that offer Web-based services. With the convergence of sophisticated technologies with greater user-friendliness, more and more law firms are now able to create what is called a client portal. Internet portals are comprehensive interactive websites that contain a range of Web-based services in addition to providing information on any particular topic. In our context, a client portal is a kind of client relationship system set up by a law firm that uses the internet as the main mode of communication between the law firm and their clients. In such portals, clients may get legal information, legal guidance and documents drafted.
In more sophisticated client portals, one can create an integrated virtual workspace with the following features:
When such features and functions are introduced in the client portals which are managed by a law firm, the practice can be said to offer 'e-enabled' services where 'e' stands for electronic.
Yet another type of portal that law firms can consider setting up is what is called 'transaction portals'. These are portals which focus on specific practice areas such as conveyancing, litigation, corporate secretarial matter and intellectual property rights management. In such transaction portals, the same features such as those available on the client portals are also usually available. In addition, one may also create a 'dealroom', a sort of online work collaboration platform among lawyers from different firms servicing their respective clients. Such dealrooms are often secured by way of network security features (firewalls), encryption or simply through the control of access by way of userid and password.
Practical Steps to Take
Now that we have gone through the basics of designing an internet strategy and the kinds of features that can be built into client and transaction portals, what steps should one take next?
First, if you have the resources, employ someone from within the law firm to focus on the firm's internet strategy. Nowadays, it is quite common to see lawyers working full time on technology issues in a law firm. If these lawyers have technical background, that would be advantageous. But lawyers focusing on technology issues are still a minority and only the big firms see some business logic in creating such posts. Smaller law firms or even big law firms with less resources to engage such a person on a full time basis could get external consultants on a project basis.
Second, design a clear overall business strategy for the law firm where the internet strategy is one of the key features. For example, is it the law firm's strategy to focus on a niche market but high-value transactions? Or is the strategy more 'vacuum cleaner like', that is, taking anything that comes along at least for a couple of years until a strong clientele base is built in a particular area of practice? The business strategy should be designed in such a way so as to take into account the needs of the clients and the types of transactions that the clients would find useful if delivered over the internet. Clients have differing needs and, more importantly, different levels of 'net-readiness'. So the law firm's internet strategy must be pliable enough to accommodate the wide range of needs of their clients. Again, there is no such thing as a 'one-size-fits-all' strategy.
Third, sort out the types of services that the firm would like to offer its clients over the internet and whether the firm would like to charge for these services. I would recommend that this be done in the following stages (from (a) to (c)):
Fourth, have a clear technology roadmap. Know what technologies to use and more importantly know the limits of technology. Issues like 'scalability'2 and 'inter-operability'3 are commonplace in IT jargon, and lawyers embarking on an internet strategy must fully understand such terminology. It would be best, if the firm has the resources, to employ a technical person within the law firm to advise the firm. Lawyers who are not trained or who do not have some basic understanding of technology and its limitations cannot design a technology-adoption plan to meet the requirements of the firm and its clients.
Fifth, security issues must be addressed. The challenge of providing legal services online brings with it a new set of problems to law firms intent on providing 'e-enabled' services. Foremost among these are security concerns. Imagine if a hacker hacks into your law firm's network and intercepts confidential data belonging to your clients or if the whole of your legal precedents is stolen from your server. But there are technology solutions to this sort of security concerns, and this includes the use of technology such as firewall4 software and encryption features.
Conclusion
Traditionally, lawyers tend to think that technology issues are not really within their domain. In my view, technology issues are ignored at the peril of law firms. Law firms should re-think their traditional strategies and begin seriously to focus on new models of 'lawyering' in the internet economy. Such new approaches are not likely to replace the 'traditional' modes of service delivery that law firms provide to their clients, but will reinforce existing forms of such service delivery. This will not only lead to overall improvement in service value but may also create new revenue streams for the law firms. A new breed of lawyers as technology providers and advisors within law firms may soon be an entrenched feature in our legal service landscape.
Law firms need to 'e-enable' their practices to meet new demands from clients in this internet economy and they must make their preparation now. Lawyers must go for IT training to keep up with technology. It is still not too late as we are still at a very early stage in the internet revolution.
The provision of electronic legal services is likely to be the norm in future. The only issue is how fast the pace of change will be, or to put it in another way, how hard the pressure will be before the clients of a law firm begin to demand more and more services online. It is only a matter of time before law firms will accept the reality that websites which simply provide basic legal information will no longer be enough if they are to continue to provide quality legal services.
But lawyers need not fear the internet future. Unlike e-commerce where physical products need to be delivered, a substantial, but probably not every, component in the delivery of legal services can be done online. So the personal services of lawyers will still be required. But since the internet revolution is here to stay, the challenge is for lawyers and law firms to design effective strategies to exploit the internet to meet their client's expectations and to grow their practice in the internet economy.
Zaid Hamzah
Managing Director, i-Knowledge Technologies Pte Ltd
© Zaid Hamzah 2001
Zaid Hamzah, an advocate and solicitor, is the managing director of i-Knowledge Technologies Pte Ltd - an e-services solution provider catering primarily to the legal market. Zaid may be contacted via e-mail at zaid@myelaw.net or through the website address: i-knowledge.com.sg.
Endnotes
1 E-business (or e-commerce) is simply defined as businesses including
commercial transactions that uses the internet as the main mode of delivery from
marketing and promotion, sales closure and payment for goods and services.
2 'Scalability' is the ability to maintain a site's availability, reliability
and performance, as the amount of simultaneous Web traffic or load increases.
3 'Inter-operability' describes whether or not two components of a system, that
were developed differently, can operate in sync with each other.
4 A firewall is essentially a type of software that protects the computer system
by acting as a 'traffic controller'; allowing access to only those authorised to
go into the system and denying access to others.