TECHREPORT 2019

TECHREPORT 2019: Solo & Small Firm

The Solo & Small Firm report is sponsored by Casetext.
ABA TECHREPORT combines data from the annual Legal Technology Survey Report with expert analysis, observations, and predictions from leaders in the legal technology field. Every Wednesday we’ll be posting a new report from one of our experts, so stay tuned!

Solos and small firms are in a unique position to leverage technology in order to become more sustainable and competitive with larger firms and alternative legal service providers—they have the ability to be more agile than larger firms because of their size. There are numerous technology options available and many are solo and small firm budget-friendly. Consumers are demanding convenience, transparency, and efficiency from the legal profession. Attorneys must be adaptable to this driving force. The legal profession has some of the highest rates of addiction, depression, and suicide. Women are leaving the profession in droves and lawyers are struggling to find work-life balance. Technology use can reduce human error, increase efficiency, reduce overhead, provide flexibility, enhance attorney well-being, and better meet client needs.

Demographics

Solos and small firms (2-9 attorneys) comprise the majority of the legal profession. This year, 63% of respondents of the 2019 ABA Legal Technology Survey Report, “Volume III: Law Office Technology” were solo and small firm attorneys (32% and 31%, respectively). The largest majority of solo and small firm respondents were between the ages of 60-69 and on average most had been admitted for over 30 years. Of those participating, 69% were in solo practice, consisting of 33% female attorneys and 32% male attorneys. Estates, wills, and trusts was the largest primary practice area, based on billing, for these firms.

Overall, respondents most closely identified as being primarily litigation attorneys. Sole practitioners most closely identified as being both primarily litigation and primarily transactional attorneys (31% for each). Small firms represented a larger number of attorneys who most closely identified as litigation attorneys (at 43%).

In terms of billing practices, more solos (26%) and small firms reported offering fees based on fixed fees than any other demographic. Hourly fees, however, still dominate the overwhelming majority of respondent practices.

Here’s the most telling information about the state of solo and small firm technology use as revealed in the 2019 ABA Legal Technology Survey Report, “Volume II: Technology Basics & Security,” and “Volume III: Law Office Technology.”

Law Office Technology

Hardware

Small firms are most likely to report a desktop as the primary computer used in the firm and solos were statistically more likely than not to use a desktop as their primary computer. Overall, the largest percentage of respondents report their preferred primary operating system is Windows 10, yet solos and small firms were more likely to use MacOS than any other demographic.

Software Communications

Respondents were asked to identify the types of communication software used in their firms.  Overall, the top three software cited were: contacts (81%), remote access (73%), and electronic fax (43%). Contacts software availability among solos was up 7% from last year, with 77% of solos reporting the use of such software in 2019. The primary contact software used by most respondents is Microsoft Outlook (82%), with Clio being the next most frequently cited at just 8%.

Documents

Solos were the least likely to have document and record management software available (37%) followed by small firms (55%). Solos and small firms were also the least likely to have document assembly available but are using it more often than other demographics when it is available, and availability is increasing in those firms. The leading brand reported to be used by most respondents is Hotdocs.

General Office

Respondents were asked to identify the types of general office software available for use at their firm, the types personally used, and product brand names. Nearly all respondents report that their firms have word processing software available. Microsoft Word is by far the brand most often available at the firms.

Calendaring software was also reported as available at most firms. Solos, however, report the lowest percentage of the availability of calendaring software. Most solo and small firms reporting availability personally use the calendaring for law-related tasks. Microsoft Outlook is the primary brand reported to be available.

Overall, a large percentage of respondents have and use spreadsheet software, but, solo and small firm attorneys are the least likely to report spreadsheet software availability. Among what use there is, the most popular program reported is Microsoft Excel.

Solo and small firm attorneys were the least likely to have time and billing software, which may result from the higher use of fixed-fee pricing in solo and small firm practice. Solos and small firms are also the least likely to have presentation software, like Microsoft PowerPoint, the highest reported software used.

Small firm attorneys have the highest availability for accounting software while solos report the least availability. Although, solos are the most likely to personally use the accounting software if it is available. Overall, QuickBooks is the most popular accounting software. Most firms also have electronic billing software, but solos and small firms report the highest likelihood of using it.

Overall, 53% of respondents have case or practice management software. This is trending upward slightly from the 2018 Survey. Small firms were the most likely to use a case or practice management software, while solos were the least likely to use the software (28%). Microsoft Outlook is the most popular case or practice management software.

Legal-Specific

Solos and small firms are most likely to use specialized software (real estate closings, bankruptcy, estate planning), which may correlate to the primary practice areas for reporting solo and small firm attorneys being estates, wills, and trusts, and real estate law. Solos were least likely to have conflict checking software and rule-based docket/calendaring. The most used specialized software brand is Westlaw.

Satisfaction

Solos and small firms are “somewhat satisfied” with most of their software, but the satisfaction regarding the functionality of time and billing software has decreased (51% down to 42% for solos, and 54% down to 50% for small firms). Case or practice management software satisfaction also went down for solos, from 50 % in 2018 to 44% in 2019.

Hardware Use

Small firm attorneys are most likely to use a laptop in the courtroom, followed by solo practitioners. Based on firms of all sizes, attorneys practicing personal injury law are the most likely to use laptops in the courtroom. The greatest use of laptops is for email. Overall, 58% of respondents of all firm sizes are using smartphones in the courtroom,  compared with 84% in 2018. The greatest use for smartphones was checking email, followed by calendaring. Solo and small firm attorneys were also most likely to use tablets in the courtroom.

Software Use

Small firms are most likely to use cloud computing software. The primary cloud computing service reported is Google Docs. Overall, easy browser access from anywhere and 24/7 availability were cited as the most important benefits. The biggest concern expressed regarding its use was confidentiality and security. The importance of the name and recognition of the cloud computing software was cited as “very important” across all firm demographics (72%).

Extranets

Solos and small firms were the least likely to have extranets. Microsoft SharePoint is the most commonly used extranet service (34%), slightly more than a custom/in-house creation (33%).

Technology Basics and Security

Technology Budget and Goals

Solos and small firms are the lowest reporting demographic for the allocation of a technology budget (39% and 50%, respectively). The median annual software spend to manage the law practice, which includes practice management, document management, and time and billing software is $4,000. Solo and small firm attorneys spend on average $1,000-2,999 annually on firm management software. Solo and small firm attorneys spend approximately the same on hardware as software annually. Respondents were asked to select their firm’s top technology spending priority over the next 12 months. Solo and small firm attorneys reported hardware as their top technology priority (30% and 38%, respectively).

Technology Training and Support

When asked whether or not lawyers are required to stay abreast of the benefits and risks of technology as part of their basic competency requirement under their jurisdiction’s rules of professional conduct, 64% responded in the affirmative overall. Sole practitioners were the second most likely demographic to report having to stay abreast of the benefits and risks of technology as part of their basic competency requirement.

When faced with technology issues, solos and small firms are most likely to enlist the services of a consultant. 24% of solo practitioners, however, turn to Google to address the problem. Smaller firms are slightly more likely to be comfortable using their technology, with 62% of solos, and 61% of small firms stating that they are “very comfortable.” The first source solos turn to in order to learn more about their technology is Google (30%). A smaller percentage of solos and small firms turn to vendors and manufacturers for IT education.

Technology Information and Influencers

Solos and small firms more often cite consultants as being very influential in their technology purchasing decisions, in contrast to larger firms. Sole practitioners are most likely to report that expert review is very influential.

Technology Policies

Half of solos report that their firm has no plan or policy in place governing any firm technology. Most solo and small firm attorneys report that they have the primary responsibility for their law firm’s data (84% and 29% respectively). The most prevalent policies in place for solos and small firms include email, internet, social media, and computer acceptable use policies.

Security Tools

Respondents were asked whether their firms have a variety of security tools. Solos and small firms are the most likely to not allow personal mobile devices to access their networks (29% and 16%, respectively). Overall, small firms are the most likely to have cyber liability insurance.

Security Breaches

Respondents were asked whether their firm has ever experienced a security breach, including lost computers or phones, hackers, a physical break-in, or website exploitation. Solos and small firms reported the least experience with a breach (14% and 26%, respectively).

Viruses/Spyware/Malware

Overall, 36% of respondents have been infected by viruses, spyware, or malware. The most prevalent physical security measure taken by solos and small firms is entry security, computer locks, and security alarms. Only 26% of solos and 15% of small firms, however, report using a password management tool.

Backup

Respondents were asked how their firms back up their computer files and about the frequency of backups. Overall, most firms report backing up files at least once per day. The leading method used to back up computer files by solos and small firms is with an external hard drive. Solo and small firm attorneys were the least likely to have a formal policy on information and data retention.

Summary

Overall, technology adaptation appears to be stagnant or declining, with most increases being nominal. Solo and small firm attorneys who have arguably the most to gain from technology implementation appear not to be taking full advantage of the technology available to them.

Microsoft continues to be the dominating software brand used in law firms across all demographics. Yet,  with a greater percentage of solo and small firm attorneys responding that they are more likely to use macOS as their primary operating system than other demographics, it will be interesting to observe how this trend tracks in the years to come.

Case and practice management is a software field ripe with opportunities to improve solo and small firm practice, as well as client experience. Overall, firms reporting that they have and actually use case or practice management software is trending slightly upward, however, solos are the least likely demographic to use the software.

One of the benefits of technology, like practice management software and communications software, is the ability to conduct transactions in a secure manner. Less than 50% of respondents use file and email encryption, file access restriction, intrusion prevention and detection, web filtering, whole or full desk encryption, or employee monitoring. Assuming most attorneys across all demographics use email as a primary communication tool, a lack of technology in place to secure documents and communications increases law firm vulnerability.

At the least, solos and small firms are using some technology. The availability and use of technology in these firms, however, still isn’t mainstream.

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About Brooke Moore

Brooke is the founder of MyVirtual.Lawyer, an online law firm providing flat fee and subscription-based limited scope services to self-represented litigants, individuals, and small businesses. She is also the co-owner of MVL for Attorneys, a law company designed to assist attorneys in other jurisdictions in implementing limited scope, virtual components into their firms by leveraging the MVL brand, systems, and workflows. She’s an ArkBar Leadership alum, Judith Ryan Gray Outstanding Young Lawyer recipient, ABA Law Practice fellow alum, 2017 Women in Legal Tech honoree, 2017 Fastcase 50 Award Recipient, and an ABA TECHSHOW Board member. She is also a nationally recognized speaker and author on topics related to limited scope representation, virtual lawyering, alternative fees, attorney wellness, and legal technology.

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