Three considerations financial organizations should make before selecting a legal tech vendor

Note: This article originally appeared in Legaltech News on 3/21/2022. See here: https://www.law.com/legaltechnews/2022/03/21/three-considerations-financial-organizations-should-make-before-selecting-a-legal-tech-vendor/

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Like other corporate legal departments (CLDs), in-house teams based in the finance sector are struggling to do more with less - only with the added burden of being one of the most tightly-regulated industries on the global business landscape. While technology can help these CLDs drive new efficiencies or automate key compliance and reporting requirements, first they must choose the right provider. In a legal tech landscape boasting more than 1,800 different providers, this is sometimes easier said than done.??

Fortunately, it’s not as though financial institutions are complete strangers to technology. From as far back as the introduction of the credit card in the 1950s and the ATM in the 1960s, financial institutions have leveraged customer-facing technologies to increase efficiencies and gain a competitive edge. However, the pandemic and the sudden push towards a remote working environment may have expanded that focus inward towards digital tools such as matter and spend solutions that bring new efficiencies to middle office functions.??

As financial industry CLDs work to onboard truly advanced solutions, here are three things to consider.?

Workflows?

Middle-office legal solutions demand specific capabilities to enable cross-functional efficiencies –? and few things will derail productivity faster than new technologies or solutions that cannot integrate with a corporate legal department’s existing systems.?

To protect efficiency gains, in-house teams should evaluate prospective applications with an eye towards how compatible they will be with the document and contract management, accounts payable, and the other front- and back-office systems constituting their office ecosystem. Some examples of tools with useful integrations include AI-empowered legal bill review tools like my company’s LegalVIEW Bill Analyzer product, which enables shared visibility and data within your workflows, or matter management solutions that connect directly to popular enterprise-level tools such as Microsoft Word, Excel or Outlook.??

The more disparate systems a legal department is running, the more difficult it may be to gather the data necessary to satisfy regulatory reporting obligations or even requests from senior leadership teams. Manually curating data scattered across any number of disconnected tools or solutions is a process that can take days, possibly even weeks – by which point the data itself may no longer be accurate. A comprehensive and singular technology ecosystem built from interoperable solutions will significantly cut down on that legwork, allowing legal teams to expediently curate the data they need.??

Interoperable tools also make it easier for leadership to drive adoption among employees, which is crucial to ensuring that any technology investment yields its fullest return. Users can often be reluctant to fully engage with a technology network that requires them to juggle multiple passwords or forfeit precious time switching back and forth between various applications. Solutions that afford a greater degree of interconnectivity help to streamline those workflows, creating a more user-friendly experience that helps drive adoption.??

Business Intelligence?

CLDs should vet any advanced technology purchases to ensure that features include real-time visibility into key performance indicators. Graphical dashboards with at-a-glance metrics allow in-house teams to keep a better eye on their legal spend, as well as track operational and vendor performance. The end goal here is to make it easier to spot trends or patterns – and ultimately devise strategies that are in line with a financial organization’s larger business objectives.??

General counsel will want to consider the types of data categories they may want to highlight during a meeting or presentation. If they want to take a closer look at outside counsel spend, does a prospective new tool make that information easily accessible? And does it provide the visualizations necessary to advance that conversation in a meaningful way??

In-house teams will also want to verify that a dashboard or product allows them to benchmark their own performance against that of the industry at large. A solution featuring AI-powered predictive analytics like the LegalVIEW Predictive Insights functionality offered by my company, for example, can allow legal departments to compare outside counsel rates by matter type and other variables to formulate a more strategic approach to law firm selection and other critical decision points.??

Vendor Health?

Choosing a tech provider isn’t about focusing solely on the quality of any one solution. In-house teams should perform due diligence to ensure that a vendor has the right people, processes and technology in place to continue serving their needs for many years to come.??

For example, does a vendor have the resources necessary to offer important services like project planning and management, user training, or responsive customer support? Are they taking advantage of cutting-edge technologies such as AI to regularly update and improve products? And perhaps most importantly - will the company still be in business a year or two from now??

The goal here is to avoid the types of service disruptions that can occur when a provider lacks the technological or service bandwidth necessary to support a legal department’s ongoing growth and development. General counsel will likely find it easier to rely on a single provider who can meet any number of needs rather than being forced to manage a broad stable of vendors each addressing a different portion of their workflow.?

Identifying the right provider or solution to meet your needs requires a thoughtful, deliberate approach. Financial organizations must have a clear idea of the problems they are trying to solve, the objectives they wish to accomplish and – if possible – where their innovation strategy is slated to lead them in the future. The reward for that upfront investment of time and effort is a partner who can grow with them as they continue to seek out new and more efficient ways of working.?