How the cloud is finally bringing innovation to the legal industry

The cloud may have been embraced by businesses across all lines of work, but some industries have, understandably, remained more hesitant than others. The legal industry, with its history dating back hundreds of years, is one such profession that has appeared reticent to adopt a technology only a few decades in the making.

Innovation often provides faster results but unlike most other business sectors, this is not something law firms have traditionally strived for. By charging clients an hourly rate the legal sector does not have as much incentive to accelerate its business processes and it is often difficult for firms to  estimate accurately how long each task will take – leading to charges that are higher than expected.

[easy-tweet tweet=”The Legal Sector is beginning to embrace the cloud” user=”bsquared90″ hashtags=”legalIT”]

Recently, however, the legal sector has begun to embrace more modern ways of working and the cloud, in particular. The global financial crisis of seven years ago has forced many businesses to change the way they work and find new efficiencies and in these fragile economic conditions, customers were no longer willing to put up with unexpected charges.

One of the ways that legal firms have streamlined their business processes has been to outsource various services, specifically low value, time-consuming work. As well as transferring manual work, like document reviews, to lower cost legal services abroad, cloud computing is also helping organisations to realise the benefits of outsourcing.

the folly is assuming that physical storage is inherently more secure than digital

By moving their IT infrastructure or software to the cloud, legal firms have been achieve greater mobility and swifter disaster recovery.  The latter, in particular, highlights the folly of assuming that physical storage is inherently more secure than digital. There are risks involved with all forms of storage, but the cloud at least offers firms automatic back-ups, meaning that files can be accessed even if there’s been an internal IT disaster.

Similarly, the legal industry’s recent acceptance of outsourcing suggests a broader change in how the cloud is being perceived. Legal businesses, much like banks and medical services, contain highly sensitive information and many companies have been reticent to see this information stored digitally, let alone off-premise. Alex Hamilton, CEO of legal services firm Radiant Law, believes that modern approaches to cloud security offer a flexible way of resolving this issue.

“I think it’s important to remember that we are always going to live with security risks, but there are now more nuanced ways of approaching data protection,” he said. “You can store contact data with Salesforce, for example, but keep transaction information in-house.”

[easy-tweet tweet=”41% of UK legal firms said they were likely to move their significant systems to the cloud” user=”bsquared90″ hashtags=”legalIT, lawcloud”]

Considering that third party cloud vendors rely on a reputation of trustworthiness in order to generate new business, security is often one of their key concerns. This can mean storing data with a cloud provider is actually more secure than keeping it in-house. Of course, when the decision has been made to transition to the cloud, selecting the right supplier is critical. Service level agreements and accreditations have helped give many law firms (and their customers) peace of mind regarding cloud computing.

With security concerns abating, cloud computing is being embraced in a variety of ways. The contracting process has been streamlined, performance analysis metrics have been introduced and automation, where possible, is saving companies time and money. Understandably, however, convincing some legal firms to move to the cloud remains a difficult task.

This year, 41 per cent of UK legal firms said that they were likely to move their significant systems, such as their case management and customer relationship management, to the cloud, but the remaining 59 per cent said that this was unlikely or that they had not yet decided. For Alex Hamilton, it is worth remembering that not all legal firms embrace innovation to the same degree. 

the legal sector cannot stand still when other industries are embracing innovation 

“Innovation has generally been driven by in-house legal teams, placed under greater pressure to evolve and positioned closer to the core business. Internal teams have also historically had little support from IT departments, so are hugely receptive to external cloud solutions.”

The discrepancy between the organisations that are willing to adopt new technologies and those that are more hesitant is not necessarily a sign that legal firms remain stubbornly rooted in tradition, but it does reflect that the cloud is not right for every business, nor for every business process. Organisations may still wish to keep certain types of information on-premise and that is an understandable decision.

But even with such a well-established history, the legal sector cannot stand still when other industries are embracing innovation. Fortunately, firms are now beginning to recognise the advantages that cloud computing can offer, finally bringing a profession more than a thousand years old into the 21st century.

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