Why do mid-sized firms drag behind when it comes to technology adoption? We previously discussed the conundrum of mid-sized firms exerting more effort yet struggling to convert this hard work into substantial revenue. One significant challenge these firms face is the reluctance to incorporate modern legal technology into their operational scope. Could there be more underpinning this reluctance?
View our previous discussion here.
A recent 2024 U.S. Midsize Law Firm Priorities Report published by Actionstep addressed a slew of issues encountered by mid-sized firms – from hybrid work models to stress management and wellness. This report delves into the technological landscape of mid-sized firms, confirming that while there is progress toward tech adoption, the road ahead seems longer for them compared to other sectors.
Strikingly, fewer than two-thirds of these firms are increasing their investments in technology. The report shows a slight growth in this area, however, it appears mostly to come from firms that previously made no changes. Ironically, firms investing less in tech also saw a slight increase, painting a less than encouraging picture.
Notably, all technologies are not created equal, and massive investment in less relevant technology does not necessarily solve major issues. Challenges like billing and collections, and data entry which is notorious for being an indirect contributor to the problem, could easily be remedied with the correct technological solutions.
Unsurprisingly, it seems there is a generational divide when it comes to tech adoption. Younger attorneys are more likely to embrace technology, which creates a notable chasm between them and the rest of their more traditional colleagues. A significant reason for this divide can be chalked up to these older law professionals’ beliefs in brute-force solutions of throwing more labor at a problem rather than incorporating tech solutions.
While technology advances and offers a myriad of solutions for the law industry, old fears still haunt law firms. Many legal professionals, particularly from the older generation, are skeptical about moving operations to the cloud. The worry that adopting tech will compromise a firm’s security profile remains a substantial concern. This worry is even more prominent in mid-sized firms that fear they may lack resources to hire the crucial support team required for maintaining security in a technological landscape.
The sentiment among many mid-sized firms is rooted in the fear that investing in tech may not be supported by partners in the long run. There is a prevailing fear that these investments may leave lawyers scrambling to comprehend and operate new tech tools, giving rise to a traditional mentality of, “If it isn’t broken, don’t fix it.”
However, the tide seems to be gradually turning in the mid-sized sector. After years of both Biglaw and small law firms embracing legal tech, the mid-sized firms are slowly catching up. The strategy of using people to solve issues that technology can resolve more effectively is reaching its limits. The quicker these firms grasp this, the greater their advantage will be.