Look and learn before leaping
25 February 1997
The breathtaking pace of development in information technology available to lawyers brings enormous opportunities for small firms.
Improvements in the speed with which documents can be drafted and turned around, in the availability of legal and marketing information, and in communication with clients, domestic and international, have been dramatic. But these opportunities also bring dangers, especially for small firms.
Technophobe partners may fail to permit investment in technology, or not make use of it, and business will be lost to such firms.
Alternatively, without the financial muscle to engage consultants, small firms may be bamboozled by unscrupulous suppliers into buying the wrong equipment or software.
A less obvious danger is presented by the natural tendency for the job of commissioning and buying IT to be delegated to the partners who are prepared to devote their time to it. They are likely to be interested in the application of information technology per se and, if allowed to run riot, will spend the firm's entire profit, if not turnover, on gadgets which are useful but not essential.
IT used to be the province of the back office, and the accounts system was often the extent of computerisation in a firm. Today, data and document production and management and communications have tipped the balance of power towards the front office, and it is vital that the partners lead the introduction and use of technology.
With this in mind, any investment firms make in IT must meet one or more of the following objectives:
to enable provision of services efficiently and profitably
to contribute to the perception that we are up-to-date
to meet client demand.
Six years ago, my firm had 25 fee-earners and 26 support staff: a ratio of about one to one. We now have 44 fee-earners but, because of investment in our PC/Novell network for the entire firm, support staff have only increased to 32.
Initially, secretaries typed letters and documents and our lawyers simply checked them on their screens. Gradually, by a process of training and evolution, our lawyers have come to prepare many of their own letters and documents on their own screens, sending them out directly via network faxing.
There is seldom an obviously right time to make a particular investment. Almost without exception, the longer you wait, the less you pay and the more you get. It is here that the influence of client perception has a major influence.
In 1993, our Wang system was still working adequately and there was no clear and pressing operational need to replace it. But our clients in the IT world were questioning how we could be taken seriously as advisers on matters of IT law if we were not keeping pace with them and embracing the latest technology.
The timing of our investment in a new PC network was certainly influenced by questions of perception. Similarly, we introduced external e-mail earlier than many firms due to pressure from clients in the US.
Recently, we have created our own Web site, not because we believe it will induce serried ranks of new clients to instruct us, but because existing clients expect us to do so. By contrast, we have chosen to defer any general access to the Internet by staff because we do not believe it will increase efficiency and we are not being driven by clients to do so.
The trick to investing at the right time is to stay "one step behind". It is important to:
let large organisations commission bespoke software, and rely instead on off-the-peg proprietary packages
stay flexible - modular design helps when expanding the system and eases upgrading
use a single system supplier, so there is one person to blame if things go wrong
insist on a 'turnkey' contract and do not change the specification
'instruct' a partner who has not been involved in the buying decision to negotiate the contract as if the firm was his client
invest in training for all partners and staff
treat investment in IT as a revenue item, rather than assuming that a large one-off capital investment will last you for more than a couple of years.
When the technology is installed, partners should lead from the front, setting an example in the use of IT, and they should make the most of the opportunities to impress clients.