TODAY’S LEGAL MARKETPLACE
Several expressions have been used to describe the amalgamation of tasks and processes, that make up the system of upholding the system of laws and regulations, that guide our day-to-day interactions as humans. Expressions like legal industry and legal profession have been used. However, in the past few years, the idea of a legal market or marketplace has become increasingly popular.
One can only speculate as to the reason for this. However, it must be noted that there is now a mainstream understanding as lawyers, that our role goes beyond knowing where to find the law and how to apply it.
The idea of a market presupposes a common area where goods and services are exchanged. When it comes to legal services, there are buyers and sellers. As lawyers, we are the sellers in this instance and the clients who come to us for our services are the buyers. This exchange between the seller and buyer takes place in the legal market.
Historically, this has always been a straightforward transaction. Often, when a person is in any legal trouble, they quickly find the nearest lawyer who can help them find their way out of it. A meeting takes place between this prospective client and the lawyer – usually in the lawyer’s office. The lawyer listens to the client’s problem and advises the client. The lawyer is then retained (if both parties agree), and goes about finding the best solution to the client’s problems, with the aid of the law and their experience in such matters.
While the clients will always need to find solutions to their legal troubles, the manner in which they go about it has changed. Today, a meeting between a lawyer and his client may take place using Zoom or Google Meet. In some instances, given the advent of AI-assisted technology, the client may no longer need the services of a lawyer because there is a computer program that can help with solving the issue that he/she faces.
Let us take a detour into market economics and how they affect legal services. Generally, a market needs a buyer and a seller (the client and the lawyer in this instance). Although there is also the need for a third party who will bring about competition. In the legal services market, this may be Alternative Legal Services Providers.
Alternative Legal Service Providers are firms that deliver legal services outside the traditional model of lawyers working in a law firm. They include but are not limited to:
- Legal Process Outsourcers (LPOs): These are independent organisations that carry out routine legal services (often high-volume, low-value tasks) on behalf of a law firm or in-house team. They are typically located in lower-cost regions.
- Captive LPOs: These companies undertake the same type of work as LPOs but are wholly owned by a law firm or a corporation. Again, they are often located in lower-cost regions.
- Managed Service Providers. These may be independent or captive and they typically carry out all or part of an in-house team’s function from end to end.
- Legal services provided by organisations that are not primarily law firms: For example, the Big Four accounting firms.
- Contract and Staffing Services: Here lawyers are provided temporarily to companies and law firms. Tasks can range from entry-level document reviews to those requiring highly skilled specialists.
The widespread adoption of legal technology is also changing the style and variant of services offered by various lawyers and law firms. Legal Technology refers to the use of technology to provide legal services and support services. It uses different types of new technologies from Artificial Intelligence (AI) to blockchain technology to provide niche legal and business solutions.
In the past, the term legal technology was more commonly associated with exclusively law firm technology, which helped with support services such as practice management, accounting, billing and document storage. However, from 2011, the term has grown to include technological solutions that make access to legal solutions easier for the public, online platforms for connecting lawyers and legal focused technology start-up companies.
The legal industry is known to be conservative. This means that the effects of the digital transformation of our society have not been as widespread when compared to other industries, like the financial services industry and media. Legal advice is usually written by legal professionals in various law firm structures and delivered using formal documentation on a one-on-one basis. Clients are dependent on lawyers for legal services as they lack the technical know-how and license to practice law. However, a wave of change is upon us and every 21st century should adapt so they do not find themselves redundant.
21st-century clients are exacting in their demands and armed with more knowledge than clients in the past. This means that for any lawyer or law firm who wants to remain competitive in the legal market, there is a need to rise to the occasion.