Embracing the innovation imperative with Fulcrum GT
Dino Eliopulos, vice president, innovations & solutions, at Fulcrum GT, says now is the time to embrace a digital-first ecosystem and reshape what are still often restrictive legal operations for a more productive future.
In the fast-paced world of business, the professional services industry stands at a crucial crossroads. Outdated practices and traditional business networks have become hindrances — impeding growth, stifling innovation, and limiting value realisation for all participants in the ‘legal supply chain’ — law firms, legal services providers, and corporate legal departments. To remain competitive and capitalise on emerging opportunities, firms must embrace the modernisation of their processes and networks. It’s essential to recognise that the status quo is no longer sustainable. Change is both necessary and inevitable.
Why the legal industry is different
The legal industry is distinct due to its high barriers to entry, specialised knowledge and dynamic nature, driven by global regulations and economic trends. These factors have historically contributed to healthy profit margins and consistent firm growth. However, these favourable conditions don’t make the industry immune to change and external pressures. Recent events, such as the pandemic and ongoing economic downturn, have accelerated the need for adaptation in all sectors. Companies must continually evolve to avoid being replaced by new competitors. The operating environment is transforming, reshaping work practices, business models and the competitive landscape.
Embracing new possibilities
In the not-so-distant past, the idea of large professional services businesses other than law firms offering legal services and solutions seemed far-fetched. However, this notion has now become a reality. Similarly, artificial intelligence (AI), once dismissed as irrelevant to the legal field, has evolved to a point where its potential to enhance legal practice is undeniable. The latest generation of AI has successfully passed legal admittance exams worldwide, establishing itself as a tool that can augment legal work and expedite certain aspects of a firm’s operations. The time has come for another paradigm shift in the modernisation of the legal industry.
The outdated legal supply chain
The entire source-to-pay process – and the legal supply chain – suffer from outdated practices, heavy reliance on individuals, and manual work. The rising number of legal operations professionals spending significant effort on reviewing bills and e-bills is evidence of this inefficiency. Moreover, there is a lack of data visibility and continuity in collaboration throughout an engagement. Modernising business networks, digitising service offerings, streamlining payments, and enabling collaborative data-sharing, can unlock new ways of working, foster better relationships, and drive innovative business models. The disruption caused by digital platforms and online marketplaces in various industries also impacts the future of the legal sector. Professionals who embrace technology can leverage these platforms to reach wider audiences, tap into untapped markets, and offer services more efficiently, scaling their operations while reducing unnecessary overheads and manual efforts.
The impediments of outdated practices
But outdated practices across business networks and technologies hinder collaboration, impede decision-making, and incur additional costs in terms of time and money. Law firms and corporate legal departments prioritise both efficiency and cost-effectiveness. Consequently, the most high-performing and dynamic organisations place a lot of focus on interoperability and connectivity across systems. Furthermore, information silos prevent professionals from leveraging collective intelligence within their organisations, hindering informed decision-making. To meet the demands of the future of work, professional services must deliver solutions with innovative models, increased speed, quality and customisation. Relying solely on human expertise will be inadequate. By holding onto outdated practices and systems, professionals inadvertently restrict their ability to adapt, innovate, and drive meaningful change. Clients also play a significant role in driving this change, demanding more efficient and effective services.
The catalyst for change: modern business networks
The future of the professional services industry necessitates significant shifts in business networks and processes. Corporate legal departments will model and dictate pricing throughout the sourcing and bidding process. Firms will be evaluated not only based on their responses and proposed work, but also on their track records, client ratings, alignment with diversity, equity, and inclusion (DEI) and sustainability criteria, and the availability and execution capabilities of their workforce. In this not-so-distant future, a reduced number of intermediaries will facilitate payments, leveraging the commonplace use of digital and electronic payment methods found in other industries.
Embracing the inevitable
The time for the legal industry to adapt and adopt emerging trends is long overdue. Firms must consider offering commoditised pricing for repeatable tasks that can be augmented by AI. Subscription models — such as those used by software companies — should be explored as alternatives to traditional time and materials-based services or perpetual offerings. Both law firms and corporate legal departments seek improved business practices and favourable outcomes. This current moment presents the perfect opportunity to examine how the world operates, how it should operate, and the imminent changes that lie ahead.
