With so many technology implementation projects failing to achieve their core objectives, here’s what you can do to ensure the business embraces legal tech.
The importance of change management
Change management is defined by Harvard Business School as “the process of guiding organizational change to fruition, from the earliest stages of conception and preparation, through implementation and, finally, to resolution.”
It’s important because organisational change is notoriously difficult to get right. According to Gartner, 50% of organisational transformations fail to achieve their main objectives. A further 16% have mixed results, with just over a third, 34%, demonstrating clear success.
Lawyers face a unique set of challenges, which can make effective change management even more important – especially when it comes to successfully implementing game-changing legal tech.
Legal tech is booming
The growth of legal tech is continuing at a rapid pace, and shows no sign of slowing down. By 2025, Gartner estimates that legal technology budgets will have grown by 300%, rising from just below 4% of in-house budgets in 2020 to 12% by 2025.
It’s no surprise, therefore, that legal tech is becoming more common within in-house legal teams. There is a dramatic rise of contract lifecycle management (CLM) tools in particular. The global market was valued at $1.25 billion in 2020 and is estimated to grow at a CAGR of 13.8% to reach USD 2.7 billion by 2026.
Legal tech is big news, big money, and often a big change for how the legal team – and the rest of the business – approaches its contracting policies.
This is because a shift to digital will be a seismic transformation for many. Although law changes on a regular basis – helping to keep lawyers busy – the way in which lawyers work is not often impacted by change.
Law is, at its essence, still a story-telling process. A contract is drafted by one lawyer using specific language and wording to express the obligations of the relationship – ie which services or goods are being sold by one party to another, for what price, the terms and conditions of that transaction, and the consequences of either side failing to honour that agreement.
Contracting can become slow and complicated simply due to the use of legalese by lawyers, whereby the language used to describe even the most basic clauses can vary hugely from one contract to another.
Let’s look at an example: the choice of law clause, which is present in all commercial contracts and states which jurisdiction’s law would govern the contract (England & Wales, New York, etc.). Our data science team analysed 1.4 million contracts from our database to see how many different variations of this relatively mundane clause we could find. We found a staggering 335,000 variations of the language of that clause within our sample set.
Multiply that by every other clause within a contract and you can quickly see how complex contracting is. And, up until relatively recently, every contract had to be reviewed and redlined manually, as it has been for time immemorial.
So while introducing new technology can be challenging for any department, with legal that challenge is intensified, simply because how lawyers work has been so deeply ingrained over the centuries.
Let’s take a look in closer detail, and propose a few ideas on how to get change management right.
Tip 1. Get buy-in early
As Harvard Business School points out, change management begins when the transformational idea is first mooted – not when the system is up and running and users are expected to start using it as part of their day-to-day working lives.
When people have tech thrust upon them unexpectedly and without understanding why it’s suddenly needed, there can be negative reactions. They may not trust the technology. They may not see the value on offer. They may not even see the need for it in the first place.
People are naturally suspicious of change. Lawyers are typically analytical by nature, and will want to understand the rationale behind change. If sufficient logic is not forthcoming, and if it’s not presented early enough in the process, you are unlikely to realise your ROI potential.
So our first tip is to make the business case for legal tech well in advance. Not just to the company’s executives and board who will sign off on the investment, but the users too.
Talk with confidence about why technology is needed to overcome common business problems, and emphasise the benefits that legal tech will deliver. Get people excited – not just accepting of the need for legal tech, but actively looking forward to the difference it will make.
When your colleagues understand why legal tech is needed and how their lives will be improved, you are far more likely to get their support.
Our Building the Business Case for Legal Tech eGuide is full of top tips, practical advice, and expert insights to help make a compelling case for technology and get buy-in from the business. You’ll also discover real-life examples from GCs and senior lawyers who have gone through this process already, and have shared their experiences to make life easier for you.
We know that you may be out of your comfort zone when selling the benefits of legal tech and asking for investment. But don’t worry, we’re here to help you along the way.
Tip 2. Set expectations
While you need to get colleagues excited about what legal tech will be able to do for your legal team and the organization as a whole, that excitement needs to be tempered with a good dose of reality. Oversell the dream, and expectations may be set too high.
The result will be an underwhelming sense of frustration and disappointment – the exact opposite of the reaction you are looking for. Colleagues may soon start asking: “Why haven’t we seen value yet? When do we get a return on our investment?”
Expectation management is therefore important. Exaggerating the value that can be achieved, or how quickly that value will be seen, is counterproductive. Be realistic, and communicate clearly what positive effects are likely to be seen within a sensible timeline.
The other side of the coin when it comes to expectation management is what will be required of your users in terms of training and onboarding.
It’s easy for your stakeholders’ eagerness and anticipation to turn to frustration when they are suddenly told that they have long systems training workshops in their diaries. Attitudes towards your shiny new legal tech can turn negative, and this in turn will impact adoption and usage.
It pays to get ahead of potential causes of friction. Explain exactly what is and is not expected, and what will be required of users. If training is required – as it typically is with any tech implementation – then clarify what that looks like and what time and effort is required. Good communication will prevent disillusionment.
ThoughtRiver can help here. We have a tried and tested process to get you and your users up to speed with minimum fuss and maximum efficiency. We’ll outline exactly what is and is not expected of your colleagues. And we’ll share this implementation roadmap with you well in advance so everyone knows what the plan is.
Tip 3. Encourage adoption
This previous point is important because if there’s one thing that’s sure to result in project failure, it’s a lack of tech adoption. No matter how good the system is in theory, if it’s not put into practice it’s essentially worthless. Lack of adoption will kill ROI.
The challenge lies in the fact that there can be no prior indication as to whether users will embrace the technology or not. Most people will turn up to a training session if it means time away from their desk and free coffee and doughnuts. They may sit through training all smiles and say the right things, but ignore the platform as soon as they get back to their desks.
This point is also linked to expectation management – but in this case, it’s your own expectations that need to be managed. It’s unrealistic to expect absolutely everyone to get on board from day one. There are always one or two (but hopefully only a small minority) who need a few more nudges in the right direction.
ThoughtRiver gives you the ability to run regular reports on usage, highlighting who is embracing tech and who is failing to use it.
For example, on a relatively simplistic level you can check who has and has not logged in to ThoughtRiver. On a deeper level you can measure how many contracts each user has uploaded into the platform. The idea is not to act as Big Brother, watching your legal team’s every move. It is merely to measure the level of engagement with the tech, which allows you to understand why certain users are reticent, and remove the barriers to legal tech adoption.
Just as users must be sufficiently prepared to embrace legal tech, so you must be prepared to act as a champion of the platform and take proactive steps to increase adoption where necessary.
Tip 4. Establish ROI metrics
This blog is all about ensuring your legal tech implementation project is a success. But what does that mean exactly? How do you define success?
Success means different things to different people. Finance will likely look for the impact on the bottom line. Sales will probably want faster contracting turnaround times. Your legal team will want technology to remove the tedious, manual grind of contract reviews.
The first point to note is that success, however it is defined, needs to be measurable. After all, if something cannot be measured, how do you know whether it has improved or not? By applying metrics to your project you will be able to gauge how well it has performed.
Furthermore, all stakeholders need to agree to these metrics at the beginning of the process. This will help to avoid potential confusion and conflict later down the line. If colleagues across different departments have varying concepts of what’s important, a decision needs to be taken at a higher level to determine core metrics.
Our advice to keep success metrics to a minimum. Select a couple of core objectives, agree to them, communicate them, and stick to them. The more numbers you have flying around, the more difficult it will be to get a clear picture of what’s going right and what can be improved.
The value of successful delivery
With legal tech investment running into billions of dollars, the importance of getting implementation and adoption right can’t be overestimated. Get it wrong, and all that time, money, and effort has been wasted. These are resources that precious few companies can afford to throw away with nothing to show for them.
There’s another cost to the legal department should the project be deemed a failure too: legal’s reputation. With all departments asking for extra budget and more resources, the pressure is on to make it a success.
Legal tech is relatively new, and colleagues may be suspicious of its merits. They may wonder why legal has been granted additional budget when they haven’t. Successful implementation and effective change management will boost legal’s standing within the business, and demonstrate how the in-house legal team can really add value.
We hope these four tips help your change management initiatives and ensure your project is a resounding success.
