Survival in the IT age

Are you ready for the 21st century?

IT’S always tempting, and perhaps rather predictable, to start an article of this nature with a prediction of doom and gloom in order to grab your attention.  It’s particularly dangerous to use this tactic when discussing the Internet and e-commerce.  We’ve heard it all before, and are perhaps fed up with the more excessive attitudes and rhetoric.  It could easily turn off your audience, but…

We operate in a very small corner of the overall commercial world.  Before I’m shot down in flames, let me add that of course it’s a vital and important corner, but, nevertheless, it’s still small in comparison to other marketplaces.  That’s why feature-for-feature, specialist legal software is expensive compared to other more generic systems, but that’s another story.  Coming back to the point, if we look at what’s happening in the rest of commerce, and some closely related marketplaces, the long predicted technological revolution is happening.  In some cases it’s already over, and the new order is established.  The Internet is changing the structure, economics, culture, and processes of every business in every industry.

Take banking.  Banks have long been shedding staff and branches by the hundreds and thousands as they’ve automated virtually everything in sight.  Cashpoint machines have replaced tellers, and risk analysis systems have replaced managers’ discretion. Look at insurance, another people intensive business – or at least it used to be.  Call Centre technology, backed up with powerful underwriting and claims processing systems have enabled insurance companies to dispense with staff by the thousand leaving only the odd actuary (I though actuaries were odd anyway) to assess the risks.  Teams of “operatives” work from preset scripts to conduct the business.  Virtually any service based marketplace you can name has undergone, or is undergoing, a shift in its structure and process mechanisms caused by the adoption of new technology based methodologies.

Why should the legal market be immune?  Just because we work within a profession steeped in history and tradition doesn’t mean there’s no need for forward facing vision.  Last year, I gave a presentation on the use of e-mail in another part of the UK.  After I’d finished I was thanked by the rather solemn chairman with the following words:  “That was indeed an interesting and useful presentation, but my firm has existed for 143 years without e-mail, and I’m confident that it will last for a good few years without it as well”.  I was stunned.  He received a lot of applause for that remark, but my retort:  “Have I just heard a dinosaur roar?”  had an equally stunned effect on the audience as the penny finally dropped.

Barriers to entry are tumbling.  Anyone with the appropriate qualifications, a computer, and a telephone can set themselves up as a lawyer.  Traditional firms are facing competition from nimble, smaller niche players of this ilk, and also from financial service institutions that “add-on” legal services, almost as a loss leader as part of an overall package.  Firms of virtual lawyers have started to appear, and are starting to turn in results that are making “bricks and mortar” firms about to sign long term leases on large prestige city offices think twice.

All these challenges, and many others I’ve not got space to mention, are visible.  Yet many law firms are still procrastinating about whether or not to invest in new technology.  That battle has been fought and won; the challenge is now to be well positioned to take advantage of the undoubted opportunities.  It’s crunch time:  either you are with IT, or you are without IT.  There is no halfway house.  According to the latest figures from the Office of National Statistics 25% of UK households are now on-line, which is moving towards the Government’s target of universal access by 2005.  Ask your commercial clients how they communicate with their customers and suppliers.  Dataquest predict that over 7% of the world’s business transactions will be conducted by electronic means in 2004, its currently 3%.  I’ve read that before too long access to the Internet may be considered a basic human right. Against this backdrop, it would take an ostrich of a businessman not to recognise that something is going on here, and he better take notice – quick.

Before you all go rushing off to the nearest computer system supplier, and spend your hard earned fees on the latest silicon offering, my suggestion (although you may find it hard to believe coming from a technologist) is to stop right here and think again.  Just because you have some new tin boxes doesn’t mean that you’ve got IT sorted.  Far from it, hardware infrastructure is the easy bit.  The tricky task is changing your business practices and procedures to embrace IT, getting systems to do the routine legwork, leaving you to concentrate on the value added stuff.  The magic is in the magician, not in the wand.

The real issue is not technicalities, but transformation.  Change your people habits before you change your systems.  It’s easy to ignore the wider aspects of IT, and treat it only as an administrative matter to be handled by the office manager.  With the greatest of respect to office managers, that’s like window dressing.  The pace of change is accelerating, e-velocity as Bill Gates terms it; new skills are becoming more important than traditional professional prowess, which is taken for granted.  Advertising and marketing, for example, are ways to make your practice look and feel different to clients, coupled with flexible mechanisms to ensure that key clients, and eventually all your clients, get treated in the way they want, rather than the way you would like.

It is clear that no professional firm can afford to stand still.  You have to start with where you want to be tomorrow, rather than with where you are today.  The only constant in today’s business world is change.  So, what do you want to do?