General counsel set out modern demands of external law firms

McGuire: Law firms can’t ignore that clients are unhappy with their tech

Most companies expect external law firms to offer a flexible workforce, advanced technology and advice on how to use data to achieve a competitive advantage, new research has found.

However, a significant minority of in-house teams are unhappy with what their panel lawyers are delivering – 26% feel law firms have inadequate technology to meet their demands, while 20% are frustrated by slow response times.

The ‘Next Gen Solutions’ survey of 511 general counsel (GCs) by Censuswide was commissioned by City firm Simmons & Simmons.

Asked about services law firms could provide that were important to their operations, 67% of GCs said flexible resourcing – such as project-based lawyers, paralegals and project managers – 65% identified advice on data strategy, structure and use, and 59% said subscription-based, self-service legal products and services.

But, on each front, GCs highlighted problems. For example, a quarter experienced a lack of flexibility in the resourcing on offer, and 29% said there was a lack of specialist products or knowledge offered.

“It’s accepted wisdom that two, seemingly contradictory, things can be true at the same time,” the research said. “This is what the results from our first show us: the roadmap to meeting the unmet needs and challenges of GCs is simple and complex.

“Simple, because law firms need to deliver on what we already know: tech and client experience has and continues to represent a solvable top challenge.

“Complex, because law firms need to be highly tuned to the needs of the sector, size and location of the clients that they serve, recognising the mutual challenges but accommodating and responding to the diverse and evolving needs by reference to the individual clients.”

The failure to hit the mark on technology “won’t make easy reading for firms who demonstrated their ability to rapidly accelerate digital integration and adoption during COVID”, the report said.

“Whatever we are all doing, Simmons included, we need to do it better and quickly if we want to close the gap on GC need.”

The findings on responsiveness may link to those on technology, but the survey argued that, for many GCs, this was “just about doing the simple things well” – agreeing a clear scope and plan, keeping them informed of progress, ensuring they were engaged early when things changed and making sure there were no last-minute surprises on costs.

It went on: “Individual relationships with partners and the contribution they, and their teams make, remain important to the success of GC’s businesses (23% said ‘very important’) – but it is becoming increasingly clear that GCs are expecting law firms to offer more diversified skills, capabilities and offerings to help them solve the complex ‘business’ (rather than just ‘legal’) problems they face.”

Three in 10 (29%) of respondents said flexible resourcing was very important to the success of their legal operations.

Though the volume of data continues to grow at pace, the ability to extract value from contracts and other agreements was “still out of the immediate reach of the overwhelming majority of GCs, with the mean expecting to do so in 2.5 years”.

Just 14% of GCs said they were extracting “significant value” from their data, opening up an opportunity for law firms, Simmons suggested.

Ben McGuire, managing director of Simmons Solutions, said: “Law firms can’t ignore the fact that nearly a third of businesses in some sectors are unhappy with their external legal counsel’s inadequate technology estate.

“Equally, it is clear that all businesses – particularly those operating in the financial sector – now expect their law firms to provide a much broader set of products, services and capabilities to enhance the provision of legal advice and in support of their own legal operations.”

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