What are the legal tech trends to look for in 2021?

The legal technology industry has witnessed a monumental change in the last few years. The evolution of the industry has significantly transformed the practice of law and the delivery of legal services. As the legal practices are more becoming reliant on technology, legal practitioners must ensure their services are as innovative, practical and accessible to their diverse client base. In the outbreak of COVID-19, law firms have been affected by several like other businesses. The industry saw the reduction of clients’ business activity, postponed or cancellation of several M&A transactions and closure of courts.

According to a recent research report, law firms’ revenue was declined by 15 percent – 20 percent in 2020 compared to the previous year. As the industry is exploring new ways to navigate this pandemic, what does the future of legal tech look like in 2021?

Shift Towards Digitization

Digital transformation in the legal tech industry is gaining momentum. Digitizing legal processes can make a big difference to the way law firms function. With the rise of new technology such as AI, big data analytics and blockchain, legal firms are able to garner more value that technology can play in their operations. Digitalization of legal technology will allow lawyers to serve clients quicker and even expand services to whole new markets.

Automation

The legal sector is relentlessly facing emerging market challenges such as surged client demands, pressure for fixed-fee pricing, and greater competition from new business models and new entrants. Embracing automation could be an obvious solution that helps firms navigate uncertainties. Legal practitioners usually spend hours browsing documents for litigation, reviewing and creating documents, and raising red flags during due diligence. Thus, automating certain tasks can make it easier for practitioners to perform their jobs more effectively and focus on more valuable tasks.

Focus on Client Experience

Integrating advanced technology will certainly help law firms to create more connection points with their clients. But before implementing any technology, companies must evaluate and understand their goals as well as their clients’. It is crucial to understand clients’ feelings that make the relationship stronger, their problems, and how the firm can address matters and improve on a matter-by-matter basis.

Heightened Technology Adoption

With ever-growing competition across the industry, law firms will need to revisit and rethink the way they deliver legal services. They will require to reconsider their cost structures and invest in technology to increase efficiency. A myriad of legal technologies has evolved in recent years. These include document management and discovery tools, regulatory compliance software, legal research tools and more. Many legal technologies fundamentally reimagine the way law will be practiced in the future.

Use of Digital Signatures

Digital signature or e-signature technology in the legal industry is having a crucial moment. Since the use of signature is mandatory in law in certain cases and holds an imperative legal position in the document, digital signature technology allows legal organizations to save costs and bestow more time, attention to their clients. Digital signature software enables practitioners to sign documents on the computer and authenticate the signer more efficiently and securely than traditional physical signature does.

The adoption of technology within the legal industry has been heavily driven by major global events. According to Statista, the legal tech market generated US$17.32 billion in revenue worldwide in 2019. The legal tech startup market, which generated 570 million U.S. dollars in 2019, is forecast to grow at a CAGR of 27.82 percent by 2025, with revenues set to reach 2.49 billion U.S. dollars at the end of this period.