What is document automation? And how can SME law firms leverage it to generate competitive advantage?

(Blog post on document automation for SME law firms originally published in August 2017 here.

Written in advance of Thomson Reuters Live Webinar on the topic. The live webinar in which I spoke is available here and the recording and presentation are also here.)

Back in a May 2017 industry analysis piece (‘Don’t Dodge a Faster Draft’) for Legal Practice Magazine, I concluded that the question for SME law firms shouldn’t be, ‘Are you using automation technologies?’ but ‘Can you afford not to?’
Yet despite the increased challenges of serving clients profitably (the second greatest challenge for SME law firms in Thomson Reuters Legal UK & Ireland’s 2016 report: ‘Pedal harder, pedal smarter’), and attention that firms are giving to generating efficiencies in other areas of workflow (e.g. matter management), document automation remains underutilised in SME firms. Indeed, according to Briefing Magazine’s 2016 report, ‘Solving the automation puzzle’, even where document automation tools were used firm-wide, just 2% of surveyed firms said these were fully utilised.

So what is document automation and why should the SME law firm make it a core part of their armoury?

What is document automation?

At its most basic level, document automation is a software solution enabling users to create first draft documents more quickly and accurately than manual approaches. There are a variety of tools that users can use to automate the drafting process. Users drafting the documents can in some cases complete a questionnaire or Q&A form to enter transactional data. Party names, key dates, deal amounts and percentages can be inputted to drive the inclusion of certain clauses or paragraphs in the document. Questionnaires can act as dynamic decision trees guiding the user through transactional data. Responses can create a suite of related documents sharing this data. The data can also be captured for reuse, as well as for reporting.

‘Time savings of 80% in creating a document’

At Thomson Reuters we have a number of drafting and document automation solutions. Contract Express provides a well-maintained precedent bank containing all the automated documents for a piece of work, providing time savings of 80% in creating a document, compared with the time for traditional methods. Drafting Assistant can also check for citation and proofing errors, with the help of the Westlaw UK and Practical Law integrations, right within Word, saving yet more drafting time.

Our solutions also provide a pathway to full automation. Firms can begin with proofing and checking tools and standard precedents, such as those included in Practical Law, and progress to full customisation of their own documents using questionnaire approaches via Contract Express. They can also then use these to collaborate directly with clients. Lawyers can access templates anywhere, any time, and make key gains around speed, efficiency, and accuracy.

… And why should SME law firms embrace document automation?

‘Pedal harder, pedal smarter’ highlighted serving clients profitably as the second greatest challenge for SME law firms. But for the lucky firms with clients coming through the door, it will be the greatest. How can firms address increasing client demand for better, faster, cheaper legal services?

‘60% of legal time is spent on drafting

A bread-and-butter element of lawyers’ work, up to 60% of legal time is spent on drafting. Yet many lawyers admit they lack the time to check this work. They feel under pressure to deliver more. In this context, it is astonishing that more firms have not looked more closely at document automation. Reimagining the drafting workflow is central to reducing the cost of service delivery. What would you do if you had back the savings of 82% of drafting time that Contract Express could provide you with? Imagine the additional documents that could be drafted, the additional efficiencies and revenues gained?

But it’s not just about managing profitability. Providing the best possible client service is critical to business survival, growth, and competitive advantage. Firms cannot afford to skimp on service in a market where there is wide availability of potential substitutes. Clients expect value and expect their lawyers to creatively use tools that generate this. Tools in drafting automation solutions – citation checking, proofreading – enable accuracy, management of risk, and high quality. This directly translates to client satisfaction. Firms can free up time for fee earners to engage in added value activities, to build strong client relationships, and to look for new business. So, again I ask, ‘Can you afford not to embrace automation?’

Will barrister ABSs lead the way for innovation?

(First published in October 2017 in Thomson Reuters ‘Innovating the Bar’, No. 4, October 2017, here.)

The Legal Services Act 2007 introduced Alternative Business Structures (ABSs) to much fanfare, with predictions of the transformation of the legal market by allowing non-lawyer owners and investors. In April 2017, the Bar Standards Board (BSB) received authorisation to license Alternative Business Structures (ABSs) (‘licensed bodies’). It has been regulating lawyer-only owned entities (‘authorised bodies’) since 2015, but the new powers gave it the ability to extend ownership to businesses jointly owned by lawyers and non-lawyers.

What does this mean for the Bar? Will ABSs act as a catalyst for the traditionally-conservative Bar to develop new, cost-effective ways of working? Open the way to technology investment, to innovative partnerships, and widespread change?

In a previous article, ‘First BSB ABS a ground-breaking collaboration between barristers and football agents’ (Innovating the Bar, No. 2) we looked at VII Law’s innovative partnership between barristers and football agents, and about how ABS status enables ‘Brand Bar’ to act as an imprimatur offering trust to the provision of wider, previously unregulated services. In this article, we look at more widely the reasons why some other first-mover organisations have embraced ABSs, and at what this is likely to mean for the Bar as a whole.

Why have organisations embraced BSB Licensed body status?

As of 1 September 2017 we have seen four licensed body ABSs approved by the BSB, with VII Law, Minerva Law, and ShenSmith Law at the forefront of the charge. Although a number of other organisations have been talking about applying for licensed body status, it is as yet unclear how many will apply. The BSB has only registered 72 authorised bodies, and its public statements have been cautious about appetite for licensed bodies. Cautious take up may mirror that of the solicitors’ profession where the ‘Tesco Law’ stereotype has largely not materialised, licenses instead going to existing firms with a drive to extend partnership to non-lawyer staff.

Working with other professionals and business people

Some new ABSs exist because of a wish to work in specialist areas with other non-legal professionals. This was the case with VII Law. It is also the case with Minerva Law, run by Dr Lorraine A. Newbold. Dr Newbold has been providing legal services to the financial services industry – principally in the area of derivatives and regulatory reform relating to derivatives – from traditional barristers’ chambers for over 13 years. However, Dr Newbold’s previous experience as general counsel within investment banks had led her to appreciate the importance of working holistically across disciplines alongside professionals, such as tax, accounting, business, operational, and IT specialists. Newbold is keen to see the ABS as a platform for a wider financial services consultancy with the ability to provide legal services at its core:

‘The ABS structure could be a mechanism for providing a more comprehensive range of services to the financial services industry. I am frequently engaged to work on a project for a financial services client and am asked whether I can provide a broader range of services but under the traditional bar structure this is not possible. We hope that by having established Minerva Law Limited as a licensed body we will be able to build a team of people to work with us and we hope to provide a more comprehensive range of services to the financial services industry.’

ShenSmith Law, one of the other first licensed body entities to be authorised, also sees barrister–business collaborations as playing an important role in the growth of the modern Bar. However, rather than focusing on collaboration with other professionals to serve a niche specialist market, ShenSmith Law sees leveraging business experience as a way for barristers to relieve themselves of administrative and marketing burdens and to focus on their core legal competencies.

Moving beyond the traditional barrister space

But, for ShenSmith Law, ABS status does not just provide the skills to help barristers with marketing and practice development. Its marketing engine enables barristers to gain new sources of public access work, enabling barristers to move beyond traditional barrister spend into the wider £32bn market for legal services.
The BSB’s recent report shows clients’ evolving needs as a key driver for barrister innovation, as noted by Daniel ShenSmith in his recent blog for the Bar Council. ShenSmith Barristers was well known to have been founded as a result of its founders’ experience as a client of traditional legal services and the direct access bar. The new ABS, ShenSmith Law, builds on ShenSmith Barristers’ work to simplify the client experience. It provides the necessary legal support for the client who may otherwise lack the ability to enforce their rights due to prohibitive costs of the solicitor-barrister referral model and the confusing legal landscape. The new ABS structure will enable ShenSmith Law to extend its model, providing the benefits of direct access while keeping costs to a minimum, but also with the litigation authorisation, and the ability to instruct any member of the bar, to provide full continuity. In this way, it looks set to combine the strengths of the Bar with the support of a traditional law firm.


External ownership facilitated by ABS structures has been spoken of previously as a way to gain investment to engineer technology that can be used to reimagine the legal process. As yet, we have not seen any entity set up with this as a key aim, although there are a number of organisations innovating with technology for whom this may be a full or partial driver. ShenSmith Law, for example, is currently looking to launch DigitalBar.co.uk, website packages for barristers that will include hardware and firewall protection with a professional look and feel and incorporate unlimited storage and email addresses.

All change? What will this mean for the Bar?

On initial appearances ABSs are unlikely to lead to dramatic change for the Bar. Clients’ changing expectations will continue to drive incremental as well as more dramatic change.

Many barristers – in established sets serving traditional large and medium-sized solicitors’ firms – are unlikely to need to reinvent the wheel or to rethink their business model. Their innovations are likely to come about incrementally, via changes to fee regimes, improvements to client service, or via gradual adoption of more modern technologies. For many of the larger firms instructing them, the Bar remains the ultimate in outsourcing, a cost-efficient method of accessing high-quality, specialist advice, even if some firms would like to see a more converged profession.
For other areas of the Bar, for practice areas where working with other professionals is already a feature of modern practice, for chambers affected by legal aid pressures, for those looking to develop a practice based more around a particular niche, or for those wanting to embrace technology more fully, ABSs may prove to be a way to deliver a range of innovations. They may also pave the way for other changes: while some of these are as yet unanticipated, as ABSs become approved training organisations, they may also prove a way of opening up the profession to entrants previously denied access by low pupillage numbers dictated in part by the traditional chambers pyramid structure.