Chutzpah

Legaltech News publisher Zach Warren uses this Yiddish word to describe one of the qualities needed to launch a legaltech Startup. In addition, he says, it takes vision and the ability to think oneself into the situation of the desired user as precisely as possible. There's a lot of truth to that.

Many founders fail at even describing their customers. You often hear "all lawyers" or "all attorneys". Maybe one should also generally move away from this customer group-based mindset and instead ask the question, "what pain are you trying to solve with your new product?" Then it's time to show your colors.

One example: from the current study by Wolters Kluwer, one can read that the standardization of contracting is a very important topic for law firms and for corporate legal. But why is that? Is it about the speed at which new contracts can be created, or is it about ensuring quality? In the former case, systems like Bryter or top.legal can actually help by analyzing the most important contracts and putting them into a question-answer grid with all the options provided. In the second case, it is more about the internal workflow and ensuring that all valid templates and text modules are actually stored and, above all, maintained in a defined location and that all employees are obliged to access only these quality-checked modules.

Certainly, the answers will mostly be ambiguous. But the message is: you have to understand your customer very well and know his pains as good as possible before you start developing a new software product. And exactly the same applies to customers facing the introduction of new tools. First define the pain and then deal with possible solutions!

With these meaningful words, Leginnside says goodbye to summer vacation. We will be back in mid-August. Stay healthy!

Show factor

In his column "Lost in innovation," the highly respected Markus Hartung expresses doubts about the innovative power of both law firms and their clients, the legal departments. There is no other way to explain the fact that both staff numbers and per capita turnover at law firms continue to rise, but so does the number of employees in legal departments, Hartung says. Innovation would require a permanent, joint process analysis between law firms and their clients, and there is no sign of this.

So far, so undisputed. But is this relationship really only a professional one? I claim, no. The value of consulting services (both of lawyers and of tax and business consultants) is, after all, also determined to a considerable extent on an emotional level. The particularly aggressive lawyer's letter to the opposing party, theatrical meetings, and even heavy documents - they all serve to convince clients of the extraordinary qualifications of "their" lawyer and of his overwhelming commitment to the cause.

The question remains why clients play along here. The answer is probably differentiated: some because they want to - the behavior described above gives them self-justification that they have made the right choice. And the others? - they are probably to be found in the rapidly growing group of clients willing to change, as described in the current Future Ready study by WoltersKluwer. 

Everything will stay the same until it will change.

Chutzpah

 

Never in my life would I have thought that the word "chutzpah" existed in English. The editor of Legaltech News, Zach Warren, uses it to describe one of the character traits it takes to launch a legaltech startup. In addition, he says, it takes vision and the ability to think as precisely as possible into the situation of the desired user. There's a lot of truth to that.

Many founders fail at even describing their customers. You often hear "all lawyers" or "all attorneys". Maybe you should also generally move away from this customer group-based mindset and instead ask the question, "what pain are you trying to solve with your new product?" Then it's time to show your colors.

One example: from the current study by Wolters Kluwer - I already mentioned it last week - you can read that standardization of contracting is a very important topic for law firms and for corporate legal. But why is that, really? Is it about the speed at which new contracts can be created, or is it about ensuring quality? In the former case, systems like Bryter or top.legal can actually help by analyzing the most important contracts and putting them into a question-answer grid with all the options provided. In the second case, it is more about the internal workflow and ensuring that all valid templates and text modules are actually stored in a defined location and that all employees are obliged to access only these quality-checked modules.

Certainly, the answers will be mostly ambiguous. But the message is: you have to understand your customer very well and know his pains as well as possible before you start developing a new software product. And exactly the same applies to customers facing the introduction of new tools. First define your pains and then deal with possible solutions!

PS: Even if founders have defined the parins and found a solution, it will still be a very long journey that requires a lot of chutzpah.

In the end, it's always about money

Wolters Kluwer's Future Ready Lawyer Study 2021 was eagerly awaited, as it provides an opportunity to track changes due to the pandemic. There is one aspect in particular that I would like to address here: the growing willingness of legal departments to change.

A quarter of in-house counsel surveyed said they were looking to change law firm(s). The figure has doubled since the previous year. A key reason is the lack of use of technology in law firms. That's worth a closer look.

One would like to think that a client could care less how the lawyer handles his mandate, as long as the time, quality and price are right. To paraphrase Bertram Burtscher (Freshfields): Whether hordes of "ants" (a term used by me) are involved in due diligence or AI-supported software - who cares, as long as the result is right. 

But that is obviously no longer true. Apparently, the awareness is spreading among in-house counsel that the use of technology in law firms can lead to better quality results. Presumably, however, it's not about the technology per se, but about the transparency of the processes for the client. Or thinking one step further: in the end, it's about the best possible quality and - surprise! - it's about money.

Digitization of legal studies (cont.)

Last week I wrote about an event of the Department of Innovation and Digitalization of Law at the University of Vienna (Prof. Nikolaus Forgò). A panel discussion had also addressed the question of the low level of digitization of law studies in Austria. Today I would like to take up this topic and dig a little deeper.

Thesis 1: Digitization is preceded by standardization

If we assume that there are about 20,000 active law students in Austria, then this would be an attractive number for a digitization project. However, if you look at how diverse the teaching and examination methods are, even outside of Corona, the number quickly becomes relative. Oral and written exams, multiple choice, comprehensive papers, course exams - the list goes on. There are good reasons for each individual form of examination - from the perspective of the respective faculty/university and the examiner/department. But what does one want to digitize? Teaching or learning?

Thesis 2: Before digitization comes the why

The finding that the study of law has not really changed for decades is correct. In other fields of study, things are different; medicine, for example, students now learn in a case-oriented manner in dialog with their professors; in the past, they had learned thick volumes by heart. But when we talk about change, we should first clarify what the real goal is:

• Is the teaching itself to be digitized? 
• Is the learning-process of the material to be supported by digitized methods/means?
• Or is the real goal to provide students with knowledge and skills of digitization as such via the digitization of studies? ("Computer skills")

Depending on that, answers and possibilities will be highly different. One thing should be noted, however: If the high goal of legal studies is to give students an understanding of structures and to enable them to recognize contexts, then this is the highest of all development levels in relation to digitization. It will be correspondingly difficult to make progress here - even if standardized teaching and examination methods were agreed upon.

Why isn't the study of law in Austria becoming more digital?

In a virtual panel discussion hosted by the Department of Innovation and Digitalization of Law at the University of Vienna (Prof. Nikolaus Forgò), the question was why law studies in 2021 would still be the same as they were 30 or more years ago.

Of course, there are initiatives: ReddyForLaw by MANZ, for example, a multiple-choice-like knowledge check and the most successful app of the market leader. Or Timebite and Studo, both community-driven information platforms. Another example is Lawstar, a marketplace for legal courses. But truly revolutionary is different. Why is that?

I think it is due to the self-image of law schools in Austria and the professional training system as a whole. "Law schools have an interest in placing their students, and as the roles of legal ops increases, they have an opportunity to move their students into those roles," Connie Brenton was recently quoted on the American platform law.com. She is the HR manager at data management and cloud giant NetApp.

In Austria, on the other hand, the faculties continue to insist on the model of teaching fundamental knowledge without taking into account professional qualifications. The several years of follow-up training required to qualify as a judge, lawyer or notary also prove them right. But one thing is clear: Where there is no job-specific training, there will be no knowledge transfer in the areas of digitization, automation or knowledge management.

Don’t filter out your customer

 The two sides of Customer centricity

Yesterday, I involuntarily witnessed a customer phone call. You know, in German-speaking countries, "managers" regard large-capacity compartments of express trains as walk-in telephone booths. The man had to conduct an escalation conversation with a dissatisfied customer. In doing so, he moved very skillfully between appeasement, assurances, but also pressure (“Yes, what am I supposed to do now, I can't change the situation either”). At the end of the long phone call, the customer was satisfied to the extent that the conversation could end on a consensual basis.

Things only got really exciting afterwards, when Mr. Manager followed up in one-on-one meetings and/or conference calls with his employees. The fact that the tone of voice changed depending on the person being talked to is not unusual. Between the lines, however, it was clear that the customer's concerns were dismissed as an annoyance - mistakes happen and capacity problems are externally determined.

If you communicate this to your employees, you can spare the expense of customer centricity programs. It is then a mere mask that does not promote genuine customer understanding, but filters it out. Just like the masks in the pandemic.  Customers in project business, on the other hand, are well advised to invest a lot of energy in contract design - even if it hurts and puts the brakes on. Otherwise, they will be just as defenseless against the supposedly inevitable defects in (software) development as the unfortunate person on the other end of the line was yesterday.