The Future of Legal Innovation: Cultivating an innovation mindset
Embracing innovation forces us to approach long-standing practices with some humility and accept that they may not serve us best for the future. Innovation has become an acknowledged need in recent years because of the accelerated pace of change in business and technology.
However, innovation in professional service firms – like knowledge management in its emergent phase – has struggled to be understood, accepted, and successfully implemented, its mission sometimes vague. In her book, Legal Upheaval, Michele Destefano articulates that there is a skill and behavior deficiency that leads to this disconnect and the leap from collegiality to collaboration has still not happened among the majority of lawyers.
Innovation is about a new method or idea or service that creates value. It can range from something that modifies a process, making it simpler or cheaper to something that could be considered a breakthrough. Innovation is not about single flashes of insight, or a great idea that is not fully executed or an executed idea that is not fully adopted. This chapter considers the viewpoint of one kind of innovator, an intrapreneur. On the spectrum of innovators, this kind of innovator seeks to create innovation internally in their own department or firm or company. They are different from entrepreneurs who build something new on their own. An intrapreneur who applies their talent internally and also projects the same effect externally and loops the results back into the organization is an extrapreneur.
Barriers to change
Some of the barriers to innovation in a law firm resemble the impediments to change in any other organization. Organizational inertia is common in most large organizations, so much so that the phrase “corporate antibodies” was coined in the context of innovation. The lack of certainty associated with innovation can be daunting for anyone but especially so for lawyers, who strongly prefer clarity and precision to the opposite. This aversion to ambiguity is exaggerated because of the following aspects of a law firm.
Revenue model – the majority of a law firm’s revenue is still tied to the billable hour model. The billable hour is an impediment in the journey to doing things in a new way because the current opportunity cost of investing in a learning curve is weighed against the possible future gains. In a time sensitive and pressure driven environment, that opportunity cost can seem very high.
Partnership structure – the traditional partnership structure encourages a short-term view to growth and profitability. This reduces the incentive to invest in the ongoing professional development of administrative staff or building out a stronger technology stack to improve the overall infrastructure, workflows, and flow of information. The result could be outdated skills in the administrative ranks and weak technology infrastructures in many law firms.
Compensation system – lawyers are compensated and recognized for their billable hours, which means that that metric will be the one that counts the most. Any non-billable time is seen as unproductive, even if the practicing lawyer might benefit in the long run from learning new skills or how to use a new tool more effectively.
Drivers of change
Many large law firms have gone beyond introducing legal technology in the form of commercial tools to do some of their legal tasks in new ways. They have developed their own technology solutions, set up incubators, or invested in legal tech start-ups. Their exploration of legal technology is largely driven by clients that are pushing for lower cost legal advice and threaten to bypass law firms to use legal tech solutions directly.
Investment alone is not sufficient, although it creates the backdrop for innovation. Culture and circumstance are both key to cultivating an innovation mindset. Framing it in a way that is aligned with achieving the client’s objectives and serving the client’s interests can guarantee a successful outcome. Innovation could also give firms the cost-saving efficiencies they need to safeguard their profitability in the face of fixed prices and mounting cost pressures.
Starting point
Once this larger view and approach have been cultivated, the bigger question is what would be a good starting point. In my own case, our first knowledge audit revealed a few areas for improvement and change. The firm’s leadership prioritized the one area that is a common thread for all lawyers across all jurisdictions – the challenge of managing unprecedented levels of volume and variety of information today. Lawyers have always had to search for, navigate through, and process enormous amounts of information. They are expected to gather and manage information that spans from legal evidence to legal source materials and background research to practice area guidance.
From a knowledge management perspective, lawyers are usually balancing two kinds of knowledge – the first kind that I would refer to as crystallized or explicit, something that has been codified in books and research databases, along with a second kind of knowledge that is more fluid, contextual and tacit. In this era of hyperconnectivity, there is a third kind of knowledge, one that is drawn together in the form of crowdsourced feedback, sometimes in real time. There is a fourth kind, heretofore missing without machine scale, the knowledge that is possible because of sophisticated algorithms that can detect patterns in vast swathes of data and present back results with visualization and through search engines. With current commercial tools, it is possible to see patterns in the behavior of judges, parties, opposing counsel, and expert witnesses to make better strategic decisions in cases similar to their own. Research databases augmented with improved entity extraction and correlation can now find and extract the specific language and case citations that judges rely upon the most, allowing lawyers to insert them into their own arguments to make them more appealing and persuasive. The lawyers will still need to add their own experience-based judgment for context, something that is beyond the reach of current day commercially available off-the-shelf artificial intelligence tools.
Given that a good starting point is managing knowledge streams, our first innovative effort was to address the loss of shared tacit knowledge in our law firm. These are knowledge exchanges that typically happen over email or phone calls or at the proverbial water cooler. In any firm with multiple offices and practice groups, there is a considerable opportunity to tap into the experiential knowledge that would otherwise be labor intensive and time consuming to codify. We decided to explore a way to capitalize the third kind of knowledge described above, one that is derived and built on collective or networked intelligence. David Weinberger in his book, Too Big to Know, explains that the new tools of connectivity have changed the very shape of knowledge. The same idea was expanded by Clay Shirky in his book, Cognitive Surplus, which highlights the power of technology to share work and ideas to achieve exponentially more because of collaboration.
And what is innovation, if not finding opportunities in obstacles.
Background
The case study I am describing was at a large full-service law firm with more than 600 lawyers in more than 20 offices that used lateral acquisition as its growth strategy. In the span of a decade, the firm grew from its regional-only presence to a national firm. Quickly growing numbers of lawyers in multiple offices exacerbated the challenge of not being able to tap into the tacit knowledge of colleagues in an easy and scalable way. Lawyers relied on quick broadcast emails to ask and answer the questions, but the answers were never threaded and nearly impossible to search through and use again. As my firm’s first chief knowledge officer, I led the charge to capture and manage the knowledge from these brief knowledge exchanges in a way that connected the lawyers to each other and improved response time to clients and knowledge management.
The solution
Once we had identified our business needs, we set about to plan for a solution. We applied basic design thinking principles although we were not designing a product from scratch. There was a digital divide in the workplace and driving innovation and technology adoption meant bringing employees of all levels and understanding on board and along for the journey. We created personas and mapped the user journeys. We conducted deeper level interviews with partners, associates, administrative assistants, and professionals in the IT, marketing, records and HR departments. Before building out the training materials and videos, we focused on the user journey for each of the personas.
We introduced a social collaboration tool firm-wide that doubled as a detailed firm directory and expertise locator. This was an important tool to add to our toolkit for many reasons. With rapid expansion, both geographically and with the ongoing recruitment of new laterals, it was a challenge to keep track of the expertise that existed and grew within the firm. In terms of organizational management, it was critical to ease the assimilation of laterals so that they could see themselves as part of the firm’s community and how they fit into the bigger picture. From an economic perspective, the firm wanted to ensure that the laterals could optimize their full potential, thus justifying the recruitment costs. Finally, a law firm that harnesses the collective knowledge within its walls is fundamentally strong and wields an advantage that is not easily replicable by competitors.
Social collaboration tools operate in that messy hybrid space where corporate culture and strategy intersect, and where the hard logic of productivity and the soft sell of employee engagement cross paths. These tools enable informal learning, hybrid thinking, and serendipitous discovery.
How it worked
The tool was branded internally so that it would be easy to identify, and this included both a unique name and a visual identifier or logo. The goal for any new tool in the toolkit is to become embedded into the firm’s business language and workflow. Lawyers can easily suffer from tool fatigue and each tool available to them needs to stand on its own merit. Creating a unique brand for a tool that is expected to be deeply embedded in everyday workflows helps with initial training and messaging and later on with easy user recall.
The technical implementation of any new tool should only command a fraction of the resources and effort that go into its rollout. The rest should be diverted to training, awareness campaigns, and ongoing adoption. It is important to have a nimble response approach to any suggestions that come in during the pilot phase, when the first batch of users are using the new tool. It is essential that first impressions hit an intellectual chord with the lawyers and the paraprofessionals in the firm, else it will struggle to make any discernible impact.
Awareness and adoption
To define the dimensions of our adoption strategy, we planned the awareness, training, and change management efforts with a Head (thinking), Heart (feeling), and Hands (doing) approach. Other similar approaches are referenced around Aristotle’s “logos, pathos, and ethos” in the art of persuasion, or in the language of a psychologist, “cognitive, affective, and behavioral”. During the launch phase, an intense training effort was made via live webinars. We designed the training in multiple formats, including webex sessions, practice group-specific live training, office-specific live training, one-on-one sessions and short videos distributed through emails and on the intranet. For ongoing adoption, we offered basic and advanced training sessions on a regular basis. For the senior stakeholders that could serve as visible and significant proponents, reverse mentoring sessions proved to be an effective introduction to the new tools. The practical tips were complete with guidelines of acceptable online conduct and appropriate information sharing.
There is a reason why “Empathize” is the first stage in design thinking. When the human–machine interaction is well understood it ensures that the resulting product or service will be better received. We explained how this tool would help the lawyers, and why it would give them an advantage with client work. We were aware that any change associated with the core enterprise technology stack would be difficult, especially when it was about changing behavior around something as embedded as email, a tool that has been around for more than two decades and is a natural center of action for today’s workplace. We used a narrative that would appeal to our lawyers intellectually (Head) and explained that the pace of business is highly accelerated, an internal peer network with quick answers and suggestions helps avoid digging around for information. It also helped that the system was self-populating, which meant we could fully use technology to scale up the task of gathering knowledge exchanges for future reference.
Our adoption campaign directly borrowed from influence psychology guru Robert Cialdini’s principle of social proof and aligned with the emotional (Heart) aspect of our approach.
A challenge for the adoption of new technology within the enterprise is that the stakeholders are at different levels on the spectrum of understanding and user experience. Given that some users needed to be persuaded to use any new tool, behavioral change management was essential – they needed help to overcome their resistance, or in some cases bias. In the case of lawyers, motivation was more about getting them to understand the “why” rather than the “what”. For the late adopters, stories of how their early adopter colleagues engaged with and used enterprise social were communicated through the firm-wide newsletters, mini campaigns, word of mouth and other reliable vehicles of internal communications, like practice group meetings.
For users who were well versed in the use of digital tools, they needed lesser persuasion but still enough reason to use these tools within the workplace (which is different from their use of similar tools in their personal lives). Anecdotes of successful connections, learnings and business opportunities were highlighted. For some groups, even initial incentives through a formal reward/recognition system or a gamification system could be considered. In the long run though, these incentives are not advisable – intrinsic motivation would ideally identify the inherent value the tools offer.
Our training was aligned to the Hands-on (doing) dimension. The how-to instructions were simple with lots of visuals and steps. Social collaboration tools are usually very user-friendly but even then the instructions were communicated through cheat sheets, mini-manuals, short video tutorials, and user guides.
The results
Our tool replaced the infamous “pardon the interruption” emails in the firm. The knowledge exchanges moved from email, phone calls and water coolers to this virtual water cooler of sorts. It was set up to become the repository of the initial questions that everyone asked along with the answers, creating a searchable repository of Q&As without a manual labor-intensive process. It also helped reduce the ramp-up time of new joiners into the organization, who benefited from viewing past discussion threads and learning more about the rhythm of the firm they’d just joined. Some argue that the peer network is available via email as well, but after two decades of overuse, email has outlived its usefulness to serve collaboration, effective and broad knowledge sharing, and organizational learning.
The tool was also billed as the firm’s internal directory and was used effectively to combat the challenges of a large, expanding organization with geographically-dispersed resources. The awareness campaign was very successful and led to an adoption rate of 85 percent within the first six months after launch.
We adopted an innovative approach to capturing and managing knowledge exchanges. Our program was innovative and client-centric because it helped the lawyers find information more quickly, saving time and avoiding billing the client for spending excessive time looking for information. It had other unintended consequences, such as bringing together people across the firm. This was a benefit wherein new laterals assimilated faster into the firm and existing employees reported greater camaraderie across offices and practice groups. This changed how we captured and managed brief knowledge exchanges and searched for expertise within our firm.
Innovation is ultimately about improving the business value of an organization. Designing innovation into tangible programs requires us to rely on divergent and convergent thought, a broad understanding of technology, a nuanced observation of human-computer interaction, and insight into human behavior. To translate all this in to successful programs, we need to draw on the mental matrix of change management and user adoption.
This piece was originally authored by Vishal Agnihotri, chief knowledge officer, Hinshaw & Culbertson LLP for Ark Group's publication The Future of Legal Innovation