Fast Fish and New Technologies: Are Small Law Firms Outcompeting Large Firms?

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Fast Fish and New Technologies: Are Small Law Firms Outcompeting Large Firms?

Part of my #blogfirst project.

School of fish. Photo by Thiago Casst from PexelsWe have moved from a world where the big fish eat the little fish, says Tom Peters, the famous management consulting guru, to a world where the “fast fish eat the slow fish.”

I’ve noticed lately that many of the most innovative developments in legal technology have come from smaller firms and solo practitioners. Small firms and solos have developed some of the most successful legal website, pioneered the use of legal applications, and taken the lead in productizing legal services with technology. They have become the fast fish.

While small firms and solos can have difficulty finding good technological assistance, the flip side of the story is that small firms and solos have some advantages over big firms that help them leverage new technology and the growing availability of cloud-based Internet tools to level the playing field against larger firms.

Here are ten advantages that small firms and solos have over large firms when it comes to innovation and technology.

1. The People Most Affected by the Technology Decisions Actually Make the Decisions. Large firms generally have an IS department that manages and controls technology matters. Technology decisions are generally announced to lawyers rather than discussed or voted on. As a result, decisions tend to be based on what is best for the organization as a whole (or the IT department, not the firm) rather than what is best for individual lawyers.

In a small firm, the people most affected by the decision actually make the decision. There is an opportunity to tailor technology to individual needs. More importantly, the decision-makers will directly experience the impact of their decisions. A critical factor in the success of the adoption of any technology is the amount of “buy-in” from the people who will be using the technology. Better participation leads to better attitudes about changes, greater success with training, and more effective use of new technology.

2. Decisions Can Be Made Quickly. Some large firms have spent countless hours debating what shade of blue to use on a website, let alone try a technology tool requested by actual clients. Some small firms have gone from decision to implementation over a weekend.

Any process that involves a long series of committee meetings will foster an atmosphere of cynicism and frustration. In a small firm, decisions often can be made over lunch or a short series of focused conversations. For solos, important decisions can be made in the shower or on the drive to work.

3. The Need to Find Cost Savings Drives Innovation. In a small firm, every little bit of cost savings can have a direct impact on an attorney’s earnings. In larger firms, cost savings have more indirect results. Cost savings can be an important motivation for adopting new technologies.

If you are starting up or maintaining a small practice, the cost of a library can be prohibitive. Purchasing library material strategically in electronic form or as a cloud-based service can result in both space and cost savings. Wise choices made while attempting to cut costs, especially in current times,  can result in an innovative use of technology that leads to a more productive practice.

4. The Size of the Project is Less Daunting. It is easier and cheaper to make changes on a network of three or thirty computers than it is on a network of three hundred or three thousand computers in different geographies. Small firms can try pilot projects with one or two people who will also be primary decision-makers.

5. Technology Improvement Can Be an Important Use of Downtime. Smaller firms and solos sometimes have alternating cycles of busy periods followed by slow periods. In a large firm, the constant push to bill hours does not allow for that type of cycle and puts pressure on attorneys to focus exclusively on generating billable hours and not on developing systems or improving technology.

In a small firm, a slow period in the practice may be a perfect time to implement new software, to use document assembly to automate forms, to try a new calendaring or case management program, or simply to plan for future technology requirements. Taking more time to think about technology and explore options will result in more successful applications of technology.

6. Small Firms Are More Willing to Adapt Their Practices to Cloud Solutions. In a large firm, different departments often do things in very different ways. In addition, there may be a “Firm” way of doing things that has not been modified for many years. These firms will often spend enormous amounts of money to customize legacy installed programs to match existing practices.

Small firms, on the other hand, are likely to use cloud-based services, such as one of the case management tools, or even services for home users, and adapt their practice to these platforms. What matters is that job gets done, not that you are using “legal-specific” or customized software to do it.

7. The Payoff From Technology Investment is More Easily Seen. A larger monitor may give you an immediate impact by reducing the need to squint to see details. A premium LinkedIn account might start producing clients that can be readily traceable to your efforts. A small firm’s return on investment can be easily seen and measured. In a larger firm, return on investment can be harder to identify and may take place over a longer time frame because of the scope of projects and the time it takes to implement them and measure results.

8. Small Firms Are Willing to Experiment. Small firm lawyers are usually the lawyers speaking at seminars about innovative technologies. As a general rule, lawyers are not known as “early adopters” and many large firms are extremely conservative and unwilling to take risks when it comes to technology.

In small firms, there tends to be more of an attitude of experimentation and a willingness to try new things. There is also a willingness to admit that an experiment has not worked and to try something new. This attitude allows smaller firms the opportunity to match technology to their needs and to keep them in some cases closer to the leading edge of technology than many larger firms. Smaller firms seem more willing to try new options like document automation, case management, and collaboration tools, especially client-facing ones.

9. The Need to Level the Playing Field Drives Technological Change. Some of the more innovative uses of technology by small firms came in response to the practice of larger firms of trying to bury smaller firms in paperwork during discovery. Today’s cloud-based ediscovery and litigation management tools can give a small firm control over mountains of evidence in a way that can be superior to what can be achieved by a team of big firm lawyers not using the same technologies.

Because it is all but impossible for a small firm to compete with a large firm in a war of attrition using human resources, small firms have tremendous motivation to leverage technology to level the playing field against big firms. Competitive factors often drive excellent decisions about technology.

10. Small Firms Focus on the Practical. Often big firms seem to be preoccupied with theories, definitions, and philosophies of technological improvement and with thinking about how technology might work rather than actually getting started on using the technology. In the meantime, small firms are adopting new technologies that streamline their practices, putting up productized services and apps that draw in clients, and producing charts and visuals that help them to win cases.

An important example that is still relevant is law firm websites. Large firms seemto have websites that look like the websites of other large firms because it is seen as a requirement for a firm of stature, with no real expectation of getting clients, often a self-fulfilling prophecy. Small firms put up websites that work and get clients and client portals that keep clients.

Here are five final points to remember about technology and the small firm:

1. Be flexible and willing to experiment.

2. Build on your successes. Constantly try to extend the efficiencies you have already gained through other technology and systems you’ve developed.

3. Try to identify areas where cost savings will also result in innovation and increased productivity in your practice.

4. Focus on practical and measurable results that positively impact your clients.

5. Look at what’s happening in other professions (e.g., patient portals in health care) and with new collaboration and community-building technologies.

Be a fast fish. By being flexible, practical, and innovative, small firms and solos can use technology to increase their effectiveness and productivity and level the playing field against slower-reacting large firms.

Photo by Thiago Casst from Pexels


[Originally posted on DennisKennedy.Blog (https://www.denniskennedy.com/blog/)]

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