WHY YOU NEED A TRUSTED TECHNOLOGY ADVISOR
Moore’s law states that about every 18 months, the number of transistors per square inch on integrated circuits—which drive all computers—will double. While this formulation may not be perfectly accurate, the pace of technological change and its impact on all of us, personally and professionally, cannot be doubted.
Given that technology is increasingly more available than ever before, what makes sense for your law firm? Where should you be investing? What technologies are “must haves” and what should you avoid? More importantly – what company can you trust to ensure your technology strategy will meet the demands of your internal and external customers and overarching business strategy?
As the President of LOGICFORCE, I usually see poor IT and business strategy alignment at law firms. Normally their IT ecosystem is a mixture of hardware and software applications that lack integration, with limited ability to easily upgrade systems when needed, and virtually no long-term financial planning or discipline. The issues often become more compounded by the fact that the capital budgeting process for technology is often inexact and the partnership model at law firms does not easily lend itself to investment where the return is difficult to measure.
5 RISKS FROM MOORE’S LAW
Here are 5 risks associated with the disruptive pace of technological change brought about by Moore’s Law:
- You face unnecessary business risks by not adopting the right technology strategy.
- The cyber security threat landscape is evolving faster than law firms can handle.
- Tomorrow’s work-force will expect a workplace with a dynamic technology ecosystem.
- Your competition’s adoption of technology will require you to keep up.
- How you finance and manage technology today probably won’t scale or work in the future.
There are other substantial risks as well, but these 5 are relevant to nearly every law firm of any size. Now I’d like to take you through them one by one, and then we’ll turn to my recommended action step.
YOU FACE FINANCIAL RISKS BY NOT ADOPTING THE RIGHT TECHNOLOGY
You may not view technology as a strategic enabler of your financial success, but you should. To begin with, on a pragmatic cash flow level, law firms that use an integrated IT ecosystem average 9% higher billings annually. Integrated IT ecosystems with CRM and data analytics produce 71% more client referrals annually.
Those are both substantial advantages. But it’s just as important to acquire and deploy the right technology and avoid getting locked into an IT ecosystem that doesn’t enable positive results. In the next 12-24 months, the decisions you make about how to align your technology ecosystem with your business strategy will directly correlate to your financial well-being for the next 10 years.
The reality of this situation makes many lawyers uncomfortable, because they know they are not technologists. Ask yourself, who do you trust to architect and deploy your technology ecosystem in such a way that it aligns with and enables your business goals?
If you don’t have a ready answer, you very likely need a guide who not only “gets” legal technology, but who has a deep understanding of your law firm’s goals and culture.
Law firms that use an integrated IT ecosystem average 9% higher billings annually and a 71% annual increase in client referrals.
THE CYBER SECURITY THREAT LANDSCAPE IS QUICKLY EVOLVING
Moore’s law is giving all kinds of businesses new tools that they didn’t have before —including hackers. If your cyber defenses (including how you use the cloud) are not being updated and maintained on a regular schedule, your firm will almost certainly be seriously at-risk for cyber hacks. The resulting fallout can be measured in terms of malpractice suits, lost clients, a tarnished brand, and a downward spiral that could be hard to recover from.
Lax procedures in cloud usage can be particularly devastating. For example, uploading sensitive client data to insecure cloud systems, such as DropBox, puts your firm at-risk. But law firms do this all the time. Magistrate Judge Pamela Meade Sargent decided in Harleysville Ins. Co. v. Holding Funeral Home, Inc., that putting private client documents on a file-sharing site was like leaving them on a public park bench. For more details on the cyber security threat landscape, please see the article recently written by my colleague, LOGICFORCE CIO Jordan McQuown.
Who is guiding your firm to stay ahead of the wide range of cyber security threats facing you?
TOMORROW’S WORK FORCE WILL EXPECT A DYNAMIC TECHNOLOGY ECOSYSTEM
Members of Generation Y (those born in the 1980s and early 1990s) and Millennials (those born in the late 1990s and early 2000s) have grown up in a world awash with accelerating technology. Their daily lives have always included smartphones, tablets, laptops, and ubiquitous connectivity to the Internet and each other—all of which is increasingly facilitated through the cloud. When they encounter a cool new device or app, members of these two generations are delighted and quickly share what they’ve found with friends. They expect innovation.
These young people are your firm’s potential future partners, attorneys, paralegals, and other staff.
Law firms who fall behind, and do not embrace change, will find themselves at a competitive disadvantage when it comes to attracting and retaining this creative young workforce.
YOUR COMPETITION’S ADOPTION OF TECHNIOLOGY WILL REQUIRE YOU TO KEEP UP
Most law firms upgrade their laptops and desktops about every 3 years, and servers and network equipment are upgraded about every 5 years. However, we are seeing more law firms awakening to the reality that a regularly refreshed technology ecosystem creates competitive advantage. But new equipment alone is not the solution.
One factor that distinguishes highly profitable firms from others is the performance of their technology systems and ability to interoperate seamlessly with their clients’ systems. Security, eBilling and the sharing of work product are just a few examples of what today’s General Counsel expect.
THE WAY YOU FINANCE AND MANAGE TECHNOLOGY TODAY PROBABLY WON’T WORK OR SCALE IN THE FUTURE
If Moore’s law continues to hold true, the technology you are using today will be outdated within the next 18-24 months. Within 36 months, today’s technology will, for the most part, be obsolete. The range of everyday core technologies used at mid-size law firms comprises a large list:
- Document management systems
- Email systems
- Company issued computers
- Company issued mobile computing devices (phones, tablets, phablets, PDAs)
- On-premise enterprise applications, including time and billing systems
- Cloud-based applications of all types
- Storage systems (including network storage, off-site, and cloud-based systems)
- Backup and archive systems
- Network hardware (switches, hubs, routers, internet access, WIFI, LAN, WAN)
- Remote access systems (connectivity, security)
- All cyber-security systems, hardware and software
This introduces a major challenge: given all these technologies, how can you afford to keep everything updated?
Most law firms seem to prefer to “buy and hold through end-of life” to get the greatest ROI. But there are two major problems with this strategy:
- It’s cost prohibitive to keep your entire technology ecosystem updated.
- It doesn’t scale with your firm as you grow.
For example, let’s assume you have a server that supports 10 users today with good performance. What happens when you hire another person? Do you add them to the server and degrade everyone else’s performance? Do you buy an expensive new server just to support that new individual?
What happens if the new-hire triggers the capacity limits of your network, storage and backup, document management, on-premise applications, or other systems? Extend this example beyond servers to all other parts of your technology ecosystem, and you begin to see the magnitude of the affordability and scalability issues.
Fortunately, there are new ways of financing and managing technology ecosystems that address these concerns. Infrastructure as a Service (“IaaS”) offerings, such as our New Style Legal IT™ solution, provide a core technology ecosystem for one reasonable fee-per-attorney-per-month. This approach eliminates technological obsolescence because regular refresh is built right into the solution, and it is also inherently scalable.
YOUR NEXT STEP: A RESOURCE TO HELP YOU
While Moore’s law may not be absolutely accurate, it does directly lead to three observations that I am very comfortable making:
- The exponentially increasing pace of technological disruption in the legal market is the new business normal.
- Most lawyers are not technologists.
- Smart firms partner with a business and technology advisory firm who can help you reach your desired goals.
To help you on this journey, I’d like to offer you an eBook I’ve co-authored called Ten Strategies To Add Ten Million Dollars To Your Law Firm. You can download it for free right now. The eBook will help you begin to align your technology ecosystem for superior business performance. If you found the ideas in this article compelling, I know you’ll enjoy the eBook.