LegalTech Contract Document Management Trends for 2021 and Beyond
In recent years, Wolters Kluwer has conducted a thorough evaluation of the legal industry to identify important technology trends that could have an impact on the LegalTech market. The 2021 Future Ready Lawyer Survey provides an invaluable glimpse into the strategic mindset of both legal departments and law firms in the wake of one of the most disruptive years in memory. Unsurprisingly, the report highlights a number of changes that are likely in store for contract document management and other LegalTech automation tools in the near future.
Top LegalTech Investment Trends
The last year has convinced legal organizations that it’s time to ramp up their technology capabilities. Nine out of ten respondents said that technology was an important factor in their success during the pandemic, and 80 percent said their need for LegalTech solutions are greater than they were in the past.
That’s true of corporate legal departments and law firms alike, both of which expect to increase their technology investments in the near future. According to respondents, 57 percent of legal departments and 63 percent of law firms are already making plans to improve their LegalTech capabilities.
Among the available software tools, legal organizations are most interested in three key areas pertaining to contract document management. More than three-quarters of law firms and legal departments are planning to invest in these technologies:
- Automation of document and contract creation.
- Document collaboration and tools for contract drafting/reviewing.
- Workflow management and process automation.
Big data and predictive analytics software are also expected to have a major impact on legal practices over the next three years, but less than a third of legal professionals claim to understand those technologies well or know what specific benefits they can provide. Unlike contract automation, which carries a clear value proposition, the advantages of analytics tools are not quite as obvious.
“When I just say I’m going to go through my billing data and derive insights, that’s very squishy. I don’t really know what success looks like there,” says Dean Sonderegger of Wolters Kluwer Legal & Regulatory U.S. “Something we’ve got to work on (in the vendor community) over the next few years is really driving home where success occurs.”
However firms implement these technologies, it’s clear that having them in place and leveraging their benefits will be critical to securing new clients. When it comes to outsourcing services, 91 percent of legal departments say they’ll be investigating how law firms are utilizing technology. In fact, 52 percent of them are already asking those questions in 2021, up from 41 percent in 2020.
Resistance to LegalTech Change
Legal organizations have historically exhibited a strong resistance to change when it comes to adopting new technology for contract document management. Although a lack of training and financial constraints are certainly a factor, 47 percent of legal departments and law firms cite organizational issues as their most significant impediment.
The term “organization issues” can be applied to a number of specific constraints:
- Lack of a technology strategy: Implementing new LegalTech tools takes time and focused effort. If an organization doesn’t have a clear idea for why it needs a particular application or how it plans to utilize new software, it will have difficulty leveraging the benefits of those tools consistently.
- Fear of change: Established legal professionals may fear that any level of automation will undermine their own value and expertise. Convincing them that software tools can help remove the burden of routine administrative or low value tasks so they can focus on more important work is often the first step to overcoming those fears.
- Lack of change management process: Some organizations are not well equipped to implement change on a large scale. Adopting new LegalTech solutions requires additional training and workflow restructuring in order to make the most of those tools. Without a process in place to reshape how work is done, organizations will quickly revert to habit and abandon new ways of doing things.
- Leadership resistance: Perhaps the most difficult challenge to overcome, a lack of buy-in at the leadership level can quickly undermine any effort to implement new technology and processes. LegalTech developers need to take special care to secure the support of key leaders within an organization if they’re going to have any success at putting a new solution in place.
- Difficult to change workflows: Many legal organizations still rely on outdated legacy applications or even manual processes for their workflow needs. It can be challenging to adapt newer LegalTech tools to those procedures. Most firms and departments want to preserve at least some aspects of their current processes, which can make it hard to secure buy-in for a new system that will require them to make extensive changes.
Enhancing LegalTech Applications with Accusoft
Building a successful LegalTech application that provides the contract document management and automation tools organizations are looking for is no small task. While many developers are focused on creating innovative features that incorporate the latest trends in AI and data analytics, their software still needs the very best viewing, markup, and document assembly capabilities if it’s going to win the trust of legal professionals.
Accusoft’s collection of document management and image processing solutions allow LegalTech developers to quickly add the features they need without compromising project timelines. For eDiscovery software, PrizmDoc Viewer provides secure viewing capabilities along with extensive annotation, redaction, and file conversion tools to easily manage a wide range of document and image formats. The conversion API even allows applications to convert Microsoft Office files with comments, changes, and notes included, which is essential for complying with eDiscovery requirements.
Contract document management solutions are only as good as their automated assembly tools, which is why many LegalTech developers turn to Accusoft’s PrizmDoc Editor. With its ability to programmatically locate, extract, and replace text, PrizmDoc Editor allows developers to rapidly generate unique contracts using a variety of templates. Rather than relying on manual copy and paste methods to build and review contracts, programmatic document assembly can prepare lengthy files for review in just a few moments without anyone having to lay a hand on them. And when it’s time for markups and redlining, PrizmDoc Editor provides a familiar word processing interface that allows contributors to share files securely and make changes without creating version confusion.
The team at Accusoft is always working to provide new and exciting software features for legal applications. To learn more about our contract document management tools or other LegalTech integrations, download our legal solutions fact sheet.