Legal Technology Digital Transformation: The Tipping Point

Legal digital transformation

The legal industry has reached a tipping point in its digital transformation

Mary O’Carroll is fast becoming the doyenne of legal ops:  in demand as a speaker, a thinker and a practitioner. Ex-Googler and now head of the customer community at Ironclad, O’Carroll gained her prominence primarily through her work with CLOC from its inception in 2016 until 2021. Thus, when she prognosticates, it is worth paying attention. 

In an interview with Artificial Lawyer published in April, she was asked about the need for digitally transforming legal departments and where the drive was coming from. Her assessment is that it comes from the leaders of fortune 500 companies who are focused on the entire digital transformation of their organizations. All other departments have already undergone or are currently undergoing transformation, even HR, which she cites as an exemplar – one could infer that if HR is doing it, then why is the legal department not. Essentially, the legal department really is the last bastion of analog thinking!  

Legal is at a Tipping Point

We discussed this recently on our blog, with very similar perspectives. So, it is nice to see we are aligned with one of the key influencers in legal tech! We firmly believe that legal is reaching a tipping point when it comes to technology. A perfect storm is approaching: 

  • Business leaders are demanding legal departments transform digitally;
  • Investment in legal tech continues unabated;
  • Core technology platforms like CLM are being adopted more readily and essentially “coming of age;”
  • Artificial intelligence is at the tip of the spear and the rate of innovation is scarily fast;

At the same time, there are headwinds. As O’Carroll acknowledges, while businesses want their legal functions to move faster and implement technology that makes them more effective and efficient, they are also looking to keep spend under control. This is at a time when the complexity of business generally is increasing, and regulations and compliance have such a great prominence. So, where to start on this digital journey? 

Where to start on your digital journey?

One logical place to begin would be where the costs are highest and the time to value, the longest. As lawyers are the most expensive resource in the function, where do they spend time which could be better utilized? Well one area is in the negotiating of contracts.

Now, while more complex contracts do require time and high levels of expertise, most do not. The negotiation of standard contracts such as NDAs, MSAs, Vendor Agreements etc can be automated to a great extent thus freeing up expensive resources to concentrate on the more complex contracts which offer the better opportunity for revenue enhancement or risk mitigation, should the utmost care not be taken.

While CLM is being adopted rapidly to provide the legal platform which is key to digital transformation, it is primarily addressing the post-negotiation and post-execution of contracts. Workflow and repository capabilities are key for a CLM and very necessary. But the bulk of expense in the contract lifecycle is spent pre-execution, in the negotiation or redlining phase. Addressing the automation of that phase is also an essential part of the digital transformation journey. Doing it with advanced AI contract review technology is the mission of BlackBoiler

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