Combining Innovation & Technology for Real Change

Combining Innovation & Technology for Real Change

1. SETTING THE FOUNDATION Technology is often referred to as an innovation, but most agree that just buying technology, such as new AI-enabled software, may only serve as a Band-Aid to a problem or make matters worse. Real innovation happens when the underlying processes are examined and transformative new ways of solving a problem or creating a new service are identified. Either way, selecting technology as a solution comes later in the process.

   • Schumpeter placed a heavy emphasis on entrepreneurs and their ability to create a new good or service, a new production technique, or open a completely new market. Entrepreneurs are a main catalyst for change that causes the most disruption by modifying our current process for delivering goods and services or by creating entirely new services. Change is constant under the creative destruction model and culture is a main component to change. Both are viewed as being critical to economic growth.
     • How Does an Existing Organization Avoid Becoming Obsolete? One possibility is to make it table stakes for every organization to innovate, which might suggest that organizations incorporate R&D (Research & Development) groups to support a more routine approach to innovation or assign direct responsibility to an internal intrepreneur that is responsible for taking an idea to a finished product.

2. HOW DOES AN EXISTING ORGANIZATION AVOID BECOMING OBSOLETE? The Legal Nexus of Forces frames the issues from a law firm point of view and it surfaces many fundamental issues being driven and changed by technology. Namely, it identifies new competitors and new strategies of existing competitors, and it provides insights on how technology modifies firms’ relationships with clients. The Legal Nexus of Forces breaks the analysis down into four categories:

   • The Legal Nexus of Forces breaks the analysis down into four categories: 1. Client Sophistication; 2. Change in Competition; 3. Law Firm Innovation; and 4. Emerging Technology.
     • 1. Client Sophistication Client sophistication undoubtedly drives legal technology changes. With the advancement and consumerization of technology, law departments are able to do more with less—and that trend will continue. Reports show that law firms have been losing market share, and while corporate clients are seeing a modest increase in legal spend, the only increase in spend is occurring within the law department.
       • 2. Change in Competition Legal Process Outsourcing (LPO) and Alternative Service Providers (ASPs) increasingly take market share away from law firms. With an estimated
         • 3. Law Firm Innovation Law firms continue to leverage technology and new services to differentiate themselves in the marketplace. One key observation is that some firms have created dedicated teams to focus on innovation. Governance levels of these teams range from informal to formal. Those with the most support and direction from upper management tend to make the largest advancements and have the greatest ability to meet client demands for greater efficiency, predictability, and cost effectiveness in the delivery of legal services.
           • 4. Emerging Technology The emerging technology category is a direct reference to the Gartner Nexus of Forces, but streamlined to the legal industry. Today, vendors in the legal
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