“Great chasms are not crossed in small steps.”
So said my fortune cookie – and it has a point. There is a convenience – a comfort, you might say – in viewing the next decade of law as a series of incremental changes. After all, most outcomes are a series of steps bundled together over time. But incrementalism suggests time is plentiful and markets are friendly. Applied to law, the incrementalist view aligns well with a soft landing and a happy ending for all participants. Like a Disney movie.
I’m not buying it. We know that life isn’t always like that. There are moments when things simply speed up – you grab them or get left way behind.
The direct parallels with prior industry chapters such as ITO, HRO and BPO are clear. However, the issue of technology separates law from simply becoming another “letter” in the “O” Suite. For a while, a lot of folks wanted “LPO” to be the magic formula – after all, it was convenient. Long-distance, tech-enabled mass labor arbitrage – switch the L for the B in BPO and, hey presto, you would have “LPO”. Except it wasn’t as simple as that. And it isn’t going to be either. Why? Along with the acceleration in technology development went technology “adoption” – and along with “adoption” goes sentiment. Buyer sentiment has shifted – the expectation of tech and its impact on what we do and how we do it has far surpassed the modest goals of rote BPO back in the day. We simply expect more. We are less accepting of inefficiency. That’s symptomatic of vast change and distinctly problematic for the incrementalists who think time is on their side in law. It’s not.
I’ve written previously about the arrival of the Big Four – though, in reality, it’s not even just a matter of the Big Four. Indeed, over the next few years there will undoubtedly be a myriad of new tech and business services providers who identify that the legal business is one in which they can execute and make money. They may be content to leave the high-touch and specialist advisory work to others but they see a large kernel of opportunity driven by the tech and data at the heart of the modern industry. They see transactions where others still use lawyerly terms like “contracts”. They see data analysis using high-powered tech where others still see hourly billables. They speak with clients about SLAs routinely.
I hear people say “It’s a people industry; it will always be about people.” And I say yes-ish. I say, yes-ish because often “people businesses” confuse real people value and expertise with plain-old inefficiency. More data means more people. Big case means lots of people. Etc. You get the picture and we’ve all seen it. As soon as we introduce the people element, time and space continuums go out the window and we’re ok with inefficiency.
Which brings me to the issue of modern labor sourcing in law. The role of people isn’t going away any time soon – but the way in which we deploy and manage people – well, that’s about to start heating up. An industry based on time – yet under constraints over cost – has to look closely at ways to decrease or elmininate its operating costs.
Enter the silver bullet of modern labor sourcing in law: the promise of “on demand”. Maybe “on demand” or “just in time” terminology sounds familiar especially if you’ve taken a cab (read: Uber) home from the aiport recently. I’m guessing that at least 50% of the people who read this article will have Uber on their smartphone right now. And every driver that drives with Uber self-organizes around their technology interaction with the organization. The “on demand” model was something about which early BPO players speculated but the logistics and cost basis of delivering this were prohibitive. It made a lot of sense but the timing was wrong. Now it isn’t.
Technology has crossed the chasm.
The “onshore” versus “offshore” distinction becomes far less important for many buyers than the timely availability of qualified labor at the right price. Using technology to get what you need, when you need it – and not carrying the cost when you don’t. The key to agile delivery of modern law is the empowerment of the individual to control and manage their destiny – their participation, their personal productivity and their personal profitability. It applies as much to the professional in a firm as it (now) does to the independent contractor. As clients become less inclined to support fixed costs and salaried employees, the convenience and specificity of “on demand” becomes very appealing.
Tech is not going to replace labor in the legal sector overnight – nor any time soon. However, it is going to re-calibrate how we buy it and how we use it. It will disrupt the cost basis of legal services delivery. Disruption empowers the progressive individual and it suits the buyer though it may prove uncomfortable for some less inclined to change. Over the next several years, the legal industry will become far more competitive than what we see today – with alternative suppliers proliferating and, no question, the insertion of tech into the heart of the legal supply chain. The days of incremental change are limited and the industry itself needs to be thinking about how to use tech to cross the chasm.
So where do people fit into this up-cycle for greater efficiency? It’s a common subject of discussion in my regular discussions with the visionary co-founder of Mplace, Caleb King. We find common perspective about the legal industry from our shared experiences in the HR and HRO industries. A staffing sector veteran, he’s seen change and sees plenty more coming.
There is no holding back the tide. So next time you hail a cab or request an Uber, simply ask when, not if legal labor will be hired this way.
And plan accordingly.