Doing More with Less: Can Document Automation Help … but How?

By Lorna Campbell.

2020 has been so far, shall we say, interesting. Every aspect of our lives feels like it’s been impacted and changed in ways we’re only just starting to realise.

Change is not necessarily a bad thing. In fact, evolution has shown that change is normally a catalyst for good. Frequently painful, yes, but undeniably for the better in the long run. The trick being to still be alive and kicking when the dust settles!

As a Document Automation consultancy company working with law firms, we’re acutely aware of the level of change that’s going on, and we spend much of our time looking to see how we can help our Clients alleviate their own challenges. These are typically the same fundamental hurdles - do more with less and be more agile than they have ever been before.

It won’t come as a surprise when I say that Document Automation can, if used wisely, genuinely help businesses of all sizes with addressing these challenges.

You can make significant improvements with productivity - easily more than an 80% time saving - and the use cases for Document Automation are endless.

As well as helping you scale up your practice, compete in the legal marketplace, streamline work and improve productivity, Document Automation can help you increase workflow efficiency, reduce the risk of errors, and ensure compliance with your industry’s standards.

So, if Document Automation really can allow you to do more with less and support a shifting business focus, why isn’t everyone using it to its fullest potential?

It’s the chicken and egg situation. The same challenges can mean it’s difficult to free up the budget to adopt or further leverage Document Automation.

Several of the Document Automation vendors are offering discounts towards software costs, some are even providing deferred invoicing, so you can legitimately see the benefit and return on investment before you pay for the software itself, but is that enough to convince law firms that Document Automation can help you do more with less?

So, you think you need Document Automation…

Just to clarify what Document Automation is not, as it’s often confused. Document Automation is about the creation of documents. It’s not about what you do with them - that’s Document Management. It’s also not about who will use the documents - that’s Document Workflow. Finally, it’s not about negotiating, that’s known as Lifecycle Management.

Questions you may want to ask yourself if you’re thinking about Document Automation for your law firm include, ‘Is document accuracy ‘mission critical’ in your firm?’, ‘Do you have a high volume of repeatable documents?’, ‘Does your team need to collaborate on your documentation?’ and ‘Could the contents of your documents cause impact to your organisation if they contained errors?’ E.g. Contracts, calculations, clauses, personally identifiable information etc.

In DocGovern’s experience, most law firms answer ‘yes’ to all the above! but how many actually utilise a Document Automation solution effectively and receive ROI from their investment?

Document Automation’s Use & Its Impact on Remote Working

DocGovern undertook a programme of market research in July 2020 with a number of key individuals within organisations across a variety of industry sectors, 46% of those recipients from the legal sector, with several participants from AMLAW 250 companies.

The purpose of the research was to determine their company’s use of Document Automation, including its impact on remote working. Of these companies, some already used a Document Automation platform and others didn’t.

A White Paper [1] was put together presenting the results of the research, covering areas such as limitations of Document Automation platforms, the value of Document Automation, Document Automation & Remote Working, and how Document Automation aligns with Business Transformation priorities.

Key Takeaways

82% of respondents already used a Document Automation solution, with 68% of respondents using their Document Automation solution to interact with external Clients (e.g. via Client interviews, such as contract negotiation or intake forms).

When asked what they thought the value of Document Automation was to them, the top three answers were - improving productivity, reducing errors, and sharing knowledge.

When asked if their organisation currently uses Document Automation to support remote working, 64% stated yes. When it came to Document Automation and how it helps their organisation achieve its business transformation priorities, over 90% of respondents stated operational efficiency as the main reason.

From the research undertaken, it’s clear Document Automation plays a big part in businesses achieving Digital Transformation, and the question of whether Document Automation supports remote working is a resounding ‘yes’, with key functionality such as cloud hosting and shared collaboration being crucial parts of remote working.

More recently, an article in Legal IT Professionals [2] around remote working stated that,

“Legal teams are making much more use of cloud technologies to collaborate on matters because they now lack face-to-face interaction, but they are also prioritising legal-specific technologies that enable the legal team to function effectively in a fully remote and digital manner, including electronic signatures for contracts, e-billing and matter management, and knowledge and document management.”

“Technology brings huge benefits but approaching it in the right way is crucial...it can make significant differences to legal teams who are working remotely and need to ‘do more with less”.

“Document Automation can support remote working in terms of client collaboration and revenue generation.”

Dorna Moini, Founder & CEO,

Documate

“It’s reassuring to know if you have a system in place, that all those elements of risk that come into play in those forced dispersed systems [through remote working], have been mitigated by the Document Automation solution itself.”

Sarah Sheehan, Legal Consultant

Unit Pricing and Fixed Fee Arrangements

When it comes to ‘doing more with less’, law firms are coming under increasing pressure from clients to address the way they deliver and bill services.

For nearly 70 years, the billable hour has been the fiscal pillar of legal practice and it has been integral to the traditional way of practising law. This billing structure involves charging on a time basis and measuring performance against financial targets.

Clients pay for legal services which has no relationship to the value they receive, and lawyers are recognised and rewarded on how much time they spend doing the work. Time-based, not value based.

The legal market, however, is experiencing a paradigm shift in the delivery of legal services as new players and new pricing models are emerging in the market. These new players are not committed to traditional ways of working. Instead, these “NewLaw” practitioners understand that aligning their prices to value is critical. That keeping track of time is the lawyer’s measure of cost, not necessarily a measure of the value he or she is providing the clients. According to the American Bar Association [3], alternative fee arrangements (AFAs) can help law firms distinguish themselves in the market, open up client opportunities, and allow them to focus on providing client value rather than on the amount of time you are billing.

The use of technology has certainly impacted this trend. Lawyers have more powerful ways of analysing and leveraging data to price their services, create budgets and map workflow. With detailed information on the historical cost of different kinds of matters, law firms can uncover patterns to determine reasonable ranges of cost for a wide variety of legal services.

Perhaps rather than assuming AFAs are the best option, law firms should take an in-depth look at their business models to ensure they are meeting both the economic interests of the client and the firm.

Document Automation & Fixed Fees

According to an article in Artificial Lawyer in May 2020 [4] a new survey on the use of fixed price legal services suggests that when combined with Document Automation, lawyers can make more money, not less, especially with matters perceived to be ‘complex’.

The survey by Australia-based New Law CLE focused mostly on SME-sector firms, but its central finding is relevant to larger legal businesses. The finding is that complex matters, priced with a fixed fee, and utilising Document Automation, will generate a higher ‘yield’ relative to the amount of work put into the matter.

In other words, if you go down the route of fixed fees, then Document Automation clearly speeds up the work process, and can provide a boost to your profit margin if workflows are managed well.

In addition, clients have their own perception of what is a complex matter and will pay more in terms of fixed fees depending on the type of document; so lawyers can gain an even greater yield on work inputs when using Document Automation for such matters.

Technology has been seen as a threat to the inefficiency-based model of law firm profit generation that is centred on selling time. That, in turn, hurts technology adoption as some firm’s fear impacting their ability to bill for time as efficiency increases.

However, the survey suggests, where clients perceive a document to be ‘complex’ a combination of fixed prices and Document Automation can drive up profitability.

Conclusion

Increasing client demands are forcing law firms to be more agile and ‘do more with less’, perhaps even more so, in this current climate.

The benefits of Document Automation are well known to law firms, and although most companies are working remotely in this current climate, client demands haven’t changed, if anything, they have increased.

Unit Pricing and fixed fee arrangements is a topic hotly debated across the legal sector and law firms must be able to show value. Like all parts of the economy, the legal sector must move with the times, and client perceptions of value are always changing.

In which case, is it not perhaps better for law firms to embrace Document Automation, not only to help them be more efficient and productive, but also to enable them to compete in the current and future legal marketplace more effectively.

Footnotes

[1] DocGovern’s ‘Document Automation and Its Impact on Remote Working’ White Paper

can be read in full here https://bit.ly/39nxEuA

[2] Legal IT Professionals - ‘Accelerated legal transformation and digitalisation during lockdown’ https://www.legalitprofessionals.com/legal-it-columns/65-guest-columns/12130-accelerated-legal-transformation-and-digitalisation-during-lockdown

[3] American Bar Association - ‘TAPAs: Alternative Fee Arrangements’ - https://www.americanbar.org/groups/gpsolo/publications/gpsolo_ereport/2019/september-2019/tapas-alternative-fee-arrangements/

[4] Artificial Lawyer - ‘Doc Automation + Fixed Fees Can Drive Law Firm Profit’ - https://www.artificiallawyer.com/2020/05/04/doc-automation-fixed-fees-can-drive-law-firm-profits/

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About the Author

Lorna Campbell is the Marketing Director of Document Automation consultancy company DocGovern. A B2B marketing professional, Lorna has over 20 years’ experience in the Marketing industry. With the last ten years spent in the technology sector, including legal tech, she has worked in global organisations, as well as SME's and start-ups, creating and implementing Marketing Strategies and Growth Plans, with a focus on Digital Marketing and Content Marketing.

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