The global legal profession is facing a period of unprecedented change with technology set to have the greatest impact on law firms over the next five years, according to a report published today by accountancy and business advisory firm BDO LLP.
BDO’s Law Firm Leadership Survey polled the managing partners and senior partners of 50 leading law firms, revealing that more than 80% of participants pointed to technology as the factor most likely to have the greatest impact on their firm.
Within every geographic group, law firm leaders were twice as likely to select technology as any other single factor, and 94% of considered technology a strategic priority for their business.
“Technology has been changing the world for a long time. Why should law be any different?”
– Managing partner of a global law firm
Law firm leaders said artificial intelligence (AI) will have the greatest impact, with many believing it would replace the work of lawyers, or strip out a significant layer of work and revenue from law firms. This will in turn bring about changes to their resourcing mix,, business models and financial structures at law firms. However, many said the effect of AI was unpredictable and its scale still largely unknown.
The research also found that many of the larger and more global firms were more likely to be pioneering new technologies to stay ahead of the competition. Equally there were as many firms who wanted to carefully observe the competition before investing in new tech solutions.
When asked what the greatest challenge their firms face in keeping up with the pace of technological change 49% said that cultural change is the biggest barrier to innovation.
“Law firm leaders are agreed that the pace of change in the legal industry is accelerating. One of the key challenges of technology today is how to fund the investment in technology, in the partnership model, in order to keep up to date with the competition.“
“We are seeing several pioneering solutions entering the market. Law firm leaders are either embracing this transformation or they are waiting to see what the competition is doing. It remains to be seen who will be the winners and the losers.”