29 Oct 2015
A legacy of conservatism creating innovation inertia in the legal profession
29 Oct 2015
A need to adopt client-centric focus through innovation needed for future success, new report reveals
While 96 per cent of lawyers in private practice believe innovation is important to very important to the success of their firm, overcoming legacy barriers to develop the necessary risk appetite to implement innovation is far more problematic, the latest report by LexisNexis has found.
Innovation Inertia: 2015 LexisNexis Roadshow Report combines the findings from the 2015 LexisNexis Australian Legal Industry Innovation Survey and 2015 Innovation Panel Series to explore how the Australian legal landscape is addressing inertia and embracing innovation to drive a client-centric culture.
While the national survey indicated that innovation was largely synonymous with technology-based implementations (54%), panellists called for strategic technology adoption that is implemented through the client's lens. Meaning that innovation should not be just about technology, but transformation, to evolve and match client needs through any means. When looking at what drives innovation throughout the organisation, the importance of managing partners and leaders (54%, Survey), indicates the importance of top-down commitment.
"The need to be an 'ambidextrous' firm is also creating its own set of challenges. Being ready to adapt to tomorrow's disruption while exploiting today's efficiencies, can result in an imbalance between strategic and operation modes that can make it difficult to progress innovation initiatives," says Joanne Beckett, General Manager of LexisNexis Australia.
"Some firms have addressed this through the creation of separate businesses or teams. For example Allens Accelerate, Unison Outsourcing (RMB Lawyers) or Orbit Legal (Corrs Chambers Westgarth) which may operate more freely outside the strictures of the traditional model or parent firm," Ms Beckett explains. "We've also seen several firms start to adopt formal innovation roles, programs and processes designed to drive innovation."
Client demands for budget and outcome certainty versus a legal professional's fear of lost profit from wrongly-estimated fixed fee arrangements continues with the prime solution requiring a new form of collaborative communication and transparency between client and lawyers.
Revenue was found to be the main measurement for return on investment (ROI) for innovation (26%), closely followed by client satisfaction (24%), but most panellists uniformly agreed that the measurement focus should be client satisfaction, which would then create domino benefits into other areas to drive profitability.
"Improving the client experience means challenging traditional practices, business and fee models and putting the client above all else," Ms Beckett says.
Innovation Inertia: 2015 LexisNexis Roadshow Report highlights the importance of strategic innovation to drive a client-centric culture and identifies the need for a paradigm shift away from stifling legacy practices.
The 2015 LexisNexis Australian Legal Innovation Survey surveyed 140 Australian law firms and corporates in April-May 2015. Based on the Survey, the 2015 Innovation Panel series: Innovation Inertia in the Legal Industry was developed, which involved six panels across Australia from June-August 2015 visiting Perth, Canberra, Melbourne, Brisbane, Adelaide and Sydney consecutively with a total of 200 attendees and 24 panellists, collectively. The results and findings are reflected throughout the Report.
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