TECHREPORT

TECHREPORT 2018: Practice Management

The Practice Management report is sponsored by Thomson Reuters.

 

The annual ABA TECHREPORT combines data from the annual Legal Technology Survey Report with expert analysis, observations, and predictions from leaders in the legal technology field. For the first time, we are bringing TECHREPORT to Law Technology Today for you. Every Monday we’ll be posting a new report from one of our experts, so stay tuned!

In last year’s TECHREPORT, we noted that the profession’s adoption of practice management tools had slowed to a crawl. After several years of increasing uptake, this year’s numbers confirm the narrative that a plateau has been reached for now. “Peak legal technology” is the order of the day, barring a sea change in demographics or a disrupting event.

Usage and Adoption of Practice Management Tools

Attorneys continue to use practice management software at a steady rate at firms of all sizes. Attorneys at solos and small law firms report usage at around 30% to 35%, which has held steady for several years. Among law firms larger than 10 lawyers, the high 62% usage among firms with 10-49 attorneys and 51% usage among firms with 100+ attorneys in 2016 were mere blips. The general trend has held steady at 33% and 22% respectively with little change over the last handful of years (disregarding the 2016 blips).

Most attorneys are satisfied with the practice management software they use, as 32% reported “very satisfied” with the features and functions therein and 61% reporting “somewhat satisfied,” for a total of 93% that were somewhat or more satisfied. This is not surprising. Practice management software offers a myriad of advantages over the old ways, including an efficient way to docket, bill, manage timelines, build contacts, and store documents within one application. It is also a gateway to a paperless practice.

With such high satisfaction levels, one can only speculate as to why the adoption of practice management software has plateaued. Is the inertia of the status quo (practicing without this technology) simply too much to overcome? Is the up-front cost in time and effort to change to a new way of practice too daunting? Presumably, given the steady usage numbers, practice management software does offer value for money.

Room for Improvement—and for Disruptors

The true one-stop shop is still missing. Some practice management software includes built-in accounting, some offer built-in timelines from local court rules, some have robust document management systems, and some have great collaboration tools. But not one has everything under one umbrella. There is room for improvement, and integration with other applications can range from smooth to rickety, with no standard for what “integration” truly means nor what levels of integration are appropriate. This leads to a common refrain from attorneys trying to figure out which is best for them: it is difficult to impossible to compare different practice management software given the lack of standards.

In the meantime, the public (“non-lawyers”) are catching up. Apps for legal tasks are made available for free or minimum charge. The market for legal services at the bottom end, previously unmet, are gaining traction to the point where there is likely an invasion into legal services provided at the higher (more expensive) end. This continues to put pressure on attorneys to provide efficient and cost-effective lawyering through technology like practice management software.

Managing Clients and Conflicts

In the absence of the one-size-fits-all solution, dedicated customer relationship management software (“CRM”), document management, and conflicts products are potentially easier to implement and they provide more robust solutions. Following the theme of this report, the use of these systems has remained steady, neither trending significantly up nor down.

Metadata Removal

Bucking the steady-ship trend, metadata removal software availability is slowly rising. This is good news as privacy and confidentiality have become bigger issues. With the implementation of GDPR best practices, it is perhaps only a matter of time before attorneys are expected to take steps like metadata removal to protect the privacy of their clients.

Tablets are Laptops are Tablets are Laptops

The line between tablets and laptops is blurring. The Microsoft Surface has steadily grown in availability at law firms every year since 2015, from 12% to a high of 22% in 2018. Competitors are popping up everywhere with tablets and attachable keyboards. Those not providing the power of a laptop within a tablet are likely going to see market share and usage fall.

Tablet use among attorneys at every firm size spiked in 2016, but it did not stick among solos and small firms (which peaked at 57% in 2016 and fell back down to 47% in 2018). Meanwhile, tablet use has increased markedly among large law firms, from a low of 32% in 2015 to a high of 53% in 2018 for firms of 100-499 attorneys. Firms of 500+ also peaked at 39% usage. The Apple iPad continues to dominate the scene, with 77% of respondents reporting it was available at their firms, followed by the Microsoft Surface (22%), the Samsung Galaxy (6% and falling every year), and the Amazon Kindle Fire (3%).

The usage of tablets among the large firms is interesting. Is it because large firm attorneys travel often and enjoy the portability of tablets? Is it the ease of use of conducting large trials and transactions on a tablet? Is it the growth of legal apps that can be run on a tablet? Is it the rise of tablets becoming the equivalent to laptops such as the Microsoft Surface? It certainly appears as though the trend will hold. The soothsayer here says don’t be surprised when tablets and laptops refer to the same thing, sooner rather than later.

Remote Access On The Rise

Remote access is slowly taking shape among solos and small firms. The anecdotal demand from millennials to be able to telecommute is showing up in the numbers, with usage among solos rising from 38% in 2015 to 46% in 2018, and from 58% in 2015 to 68% in 2018 among firms with 2-9 attorneys. About time!

Curiously, a downward trend in remote access for larger firms is showing, from a high of 87% in 2015 to a low of 79% in 2018 among attorneys of 10-49, and from a high of 94% in 2016 to a low of 88% in 2018. Perhaps while working remotely has high rewards, there is a limit to just how much work one can do outside of the office.

Fees and Time Management

A word on fees. Law firms continue to report hourly fees as the most popular (69%), followed by fixed fees (15%), contingent (11%), retainer (4%), and other (1%). This is almost identical to last year.

Despite the popular discussions surrounding the need and growth of alternative fee arrangements like fixed fees, this does not seem to be borne out by the numbers. Has the alternative fee revolution reached a plateau? Before speculation begins as to why, this is one to watch in the years to come.

In a nod to practicality, electronic billing software continues to trend upward among solos and small firms generally. This is no surprise as the benefits are indisputable. Both law firms and clients like accurate accounting, and electronic billing software allows for regular billing intervals which means happier clients (yes, clients like to know you are working on their file regularly and how much it’s costing them on a regular basis!).

Rules-based docketing has seen increased use among small firms, topping out at 40% in 2018. These are incredibly useful to keep deadlines in check. It is good to see that even amongst the biggest law firms, rules-based docketing remains steady (and has not declined), indicating the value in the software. Will solos step up in the next year?

Conclusion

With few exceptions, the use of technology has not taken any large steps in recent years. Even alternative fee billing has not seen a rise. Law firm technology has been around long enough now that attorneys know what is available. It seems attorneys that wanted to change and upgrade made the change, and those that didn’t have remained behind. Perhaps the onus falls on the producers as much as on the users: an iPad-like user-friendly interface is still sought out, a layman looking at the front page of a practice management or document management software may be more intimidated than impressed, and security and speed remain question marks among the uninitiated. The world keeps turning, though, and one can only assume that those who turn with it, by adapting the technology according to the market, will be less dizzy.

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About Ian Hu

Ian Hu
Ian Hu is claims prevention counsel and the face of practicePRO at LAWPRO. He likes to hike mountains and snowboard, even though he does neither well.

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