In November, the American Bar Association (ABA) published its annual Legal Technology Survey Report. The report typically is accompanied by a series of detailed reports on specific subjects, that are published over a period of several weeks. In a previous article we dealt with the first four of those reports. In this article, we’ll have a look at the next four, which deal with practice management, budgeting and planning, technology training, solo and small firms. A ninth report was published on lawyer well-being, but it largely repeats items raised in the other reports.
Law Technology Today summarizes the following key points regarding the survey’s findings on practice management solutions.
Usage and satisfaction of Practice Management software: while the rest of the world increasingly relies more and more on technology, the legal profession hasn’t really followed suit. The use of practice management software has been more or less stagnant for the last four years. The majority of users of these packages remains satisfied with their usage.
Need for improvement and all-inclusiveness: one of the main problems with practice management software is that most of them are still only offering partial solutions. There isn’t any program that handle every aspect of law firm management. As a result, law firms typically must rely on several programs, where their interoperability leaves much to be desired.
Rise of CRM as an alternative: as a result of the limitations of existing practice management software, there has been an increase in the usage of Customer Relationship Management (CRM) solutions in law firms.
Shifts in the Use of Laptops, Computers, and Mobile Devices: 57% of lawyers still use a desktop computer as their primary work computer. This confirms the downward trend of the last years and corresponds to the increase in the use of laptops as the main work computer, which now stands at 41%. This shift towards laptop computers can be seen mainly in large firms, followed by medium sized firms. For small firms the increase in laptop usage was limited to a 1% increase (to 35%), and for solo lawyers, the number remained the same at 40%.
The Continuing Increase of Remote Access: one of the main findings of the report is that lawyers are increasingly using remote access, with 73% of lawyers using telecommuting technologies in 2019, compared to 68% last year. These are mainly used to occasionally work from home.
Consistency of Fee Structures and the Adoption of New Technology: there was little change in how law firms charge. Most law firms, 69%, are still using hourly fees. Fixed fees saw a slight increase from 15 to 17%, which came at the expense of contingent fees which fell from 11 to 9%. Other fee structures remained the same.
Budgeting and Planning
There is some good news when it comes to budgeting and planning: in 2019, the law firms that have a budget for technology slightly increased their spending. Solo firms spent about the same as last year, and have no intention of spending more next year, where all other firms that have a budget intend to increase it for next year.
The report also advises to consider budgeting for technology training (see below), and to start using metrics to measure technology usage and the track what is working and what isn’t. “Plan well, spend wisely, and prioritize accordingly; technology is and will remain an essential part of running a law firm.” (Law Technology Today)
In 2019, lawyers need technology to efficiently run their practice. In fact, by now most bar associations require lawyers to be familiar with “the risks and benefits associated with technology”. To be able to use that technology effectively, training is essential. A majority of 82% of lawyers understand that technology training is important. The bad news is that in 2019, fewer attorneys had access to technology training at their law firms. Barely more than half of the attorney respondents to the survey had technology training available at their firms. The chance of having training available at the firm rises with the size of the firm, as was the case in previous years. Interestingly, the report also warns that solo lawyers may be overestimating their technology competence and underestimating their need for training.
Solo and Small Firms
Solo and small firms (with 2 to 9 attorneys) still form the majority of law firms: with 32% and 31% respectively, they’re good for 63% of law firms. When looking at the ages of the lawyers, the largest (10-year) segment consists of lawyers between 60-69.
The survey found that technology adoption among solo and small firms appears to be stagnant or declining. The only exception is the use of practice management software, which slightly more solo and small firms are using in 2019 than before. As mentioned before, rather alarmingly, less than 50% of solo and small law firms use file and email encryption, file access restriction, intrusion prevention and detection, web filtering, whole or full desk encryption, or employee monitoring.