Are you tech savvy?

In most industries, basic IT competence is not a matter of education. It is a necessary business skill that everyone is expected to have, like being able to answer the phone or write an email. However, IT is a problem for lawyers – because the billable hour is a disincentive to efficiency and training. Charging clients per six-minute interval means that the lawyers who struggle with simple Office tools or legal-specific applications get paid more for the same work than those who use IT effectively. Learning how to use software is ‘non-billable time’.

 The growth of alternative fee arrangements (AFAs) has shifted the balance, however, and clients are no longer prepared to pay for their external counsel’s IT incompetence. The problem was highlighted by Kia Motors corporate counsel D Casey Flaherty, who created a basic technology competence audit which he made part of his external counsel selection process. His findings were as he expected – all the firms failed his test because lawyers spent far too long on straightforward tasks. This triggered a big reaction in the US where corporate counsel started to include proof of IT competence from their panel firms in their request for proposals (RFPs). The CLOC (Corporate Legal Operations Consortium), which includes 60 of the Fortune 500, is talking about asking law firms via their RFPs whether or not their lawyers are technologically competent, as they recognise that this is relevant to the fees they are charged.

Joanne Humber, head of training at Phoenix Business Solutions, is working with e-learning provider Capensys and Suffolk University Law School in Boston to automate two versions of Flaherty’s audit. One is for law firms and the other for law schools, with the idea that the next generation of lawyers will understand both the law and the technology used to deliver legal services. Some 13 US law schools offer specific legal technology modules. Suffolk’s Institute on Law Practice Technology & Innovation, launched in March 2013, offers law students a legal technology concentration which includes hands-on experience with the latest tools and technology, and internships with legal services providers that use cutting-edge technology.   

So far, no UK corporate counsel has developed a test similar to Flaherty’s, but as top legal IT consultant Neil Cameron wrote in a recent blog post, that is just as well as many UK lawyers would fail it too. While Flaherty says AFAs are the answer, Cameron observes that this simply transfers the cost of lawyers’ IT incompetence from the client to the law firm and that law firms need to start training their lawyers now.

The closest thing to an assessment has been created by LTC4™ (Legal Technology Core Competencies Certification Coalition), a group of law firm training professionals who have established a set of workflow-based competencies covering the main aspects of legal work that are supported by technology. Phoenix and Capensys are closely associated with this project, which includes a certification programme.

Is the dearth of legal IT proficiency confined to law firms? Stacey Coote, UK CEO of Yerra Solutions, recalls working in legal operations and legal procurement in blue-chip corporates, implementing legal-specific technology, including matter management, document management and e-billing systems. ‘Although general counsel usually recognised the value of investing in IT tools to streamline and automate processes, it was a struggle to convince lawyers to learn how to use them,’ he says. ‘Even hands-on training was not as effective as it should have been, with lawyers requiring a lot of support even after they had completed the training. Lawyers are intelligent. They simply didn’t want to know.’

Humber believes it is time for lawyers to step up to the plate. ‘Lawyers need to take ownership of their own technology skills – they can no longer rely on support staff to carry them, particularly as the lawyer:secretary ratio is as high as 11:1 in some firms,’ she says. ‘Firms invest heavily in technology yet lawyers are deeply reluctant to attend technology training sessions… We carefully tailor our training so that it covers real-life activities. However, there is still resistance, and until lawyers understand that there are tangible business benefits to being IT competent, this situation will continue.’

What is needed is a cultural change. The two main change drivers stem from the recognition that lawyers are motivated by money. Whereas the billable hour was a disincentive to change, the increasing number of clients requiring their lawyers to have at least basic IT proficiency has made them sit up and take notice. The initial impetus was from Flaherty at Kia Motors, but now more corporate counsel are taking up the cause and making IT competence part of the procurement process.

‘We expect our lawyers to be familiar with our legal systems, both in terms of our matter management systems and our SharePoint portal, C-Net, which we use to manage our Legal Network,’ says Richard Tapp, group general counsel and company secretary at Carillion plc. ‘We also expect people to be competent in the basic packages as well as in legal research tools, and we offer training in our own systems and take training offerings from our legal research providers.’

In his former procurement role dealing with panel appointments, Coote expected external counsel to have basic IT competence, which he tested with online RFPs. These included asking firms whether they could use his company’s e-billing system and other online tools. He was shocked by the number of partners who asked their secretaries to do this for them.

The second driver relates to the changing legal services market. Fewer training contract opportunities for law school graduates combined with the growth of alternative legal services providers, whose businesses are often built on technology, means that IT-literate law graduates will have broader potential employment opportunities. Coote agrees with numerous general counsel that alternative business structures are striding ahead when it comes to leveraging technology and innovating to drive the business of law. And this in itself should be an incentive for law firms to change.

Joanna Goodman MBA is a freelance journalist and editor of Legal IT Today