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Six highlights: How clients view innovation in legal services

A new beatoncompass report probes corporate clients' knowledge, expectations and attitudes related to innovation in legal services. The insights are penetrating, sometimes surprising, and always actionable. Order here.

The survey

In late 2017 our online survey received 154 detailed quantitative and qualitative responses from corporate clients of Australia’s largest law firms. One-third were in-house lawyers and the balance a mix of c-suite executives and managers. The sample was a cross-section of corporate Australia.

Why we are researching this field

To recap, corporate and commercial legal services are now in the mature, or buyers’ market, stage of the industry life cycle. Powerful forces are at work, including more-for-less demands, price-down pressures, new forms of competition, technological augmentation and substitution of lawyers’ services, and growth of law departments.

All this means effective innovation is fast becoming a determinant of success, even survival, for the supply and demand sides of the market.

Yet little-to-nothing is systematically known about clients’ knowledge of and attitudes towards innovation, whether in clients’ own organisations or in outside law firms. Most media and conference coverage of legal services innovation focuses on technology, but is this how clients see the world of innovation? In a word 'No'.

Some highlights of the report

  1. When asked ‘What makes law firms innovative’ only 15% gave answers related to any kind of technology. To beaton, this is not unsurprising; in the office towers of Australia in-house lawyers grapple daily with many more things where innovations, other than technology, would make a big difference to getting work done in a better, faster and cheaper way.

  2. Startlingly, more than one in four of all respondents replied ‘Nothing’ when asked whether they could name any law firm they would regard as innovative.

  3. And of the firms that were nominated as innovative, two-thirds were not the primary firm for the respondent. It seems most clients need to look over the fence to find innovative firms ­– and then the question is are these firms amenable to and capable of helping?

  4. When their current firms are not delivering, is it any wonder why clients are looking to competitors for innovation? When asked if they had personally experienced an outstanding example of innovation that addressed their needs, one in four respondents said ‘No’.

  5. To test the well-known truism that a professional services provider can only be as good as their client will allow we asked the respondents how important innovation was to achieving their job-related KPIs. One-third said ‘Very important’ and of these eight in ten said advice from outside law firms on new technologies and processes was important. Clearly there is pent-up, unmet demand.

  6. Yet when asked about their internal innovations of their law departments, only 11% said these innovations were co-designed and implemented with a law firm. There is an obvious need – and opportunity – for law firms to collaborate with their clients that is not being filled.

​Enquire here to obtain a copy of the Client-lead Innovation in Legal Services report.

George Beaton

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