When considering the role innovation plays in the success of a law firm, it is important to illustrate not only what innovation is, but also what it is not.
Innovation is not technology
It may sound obvious, but conflation of the two is prevalent and this reflects a failure to grasp the very nature of innovation.
Innovation should be thought of as a mindset — a lens through which every business decision is made. It is looking at everything from your most mundane habits to the weightiest pillar of your strategy, and thinking: how can we do this differently?
Investment in people is key. Law firms now rely upon the expertise of innovation specialists, however it is not for them to ‘do the innovating’ or to act as a bolt-on to teams of lawyers who otherwise continue as they were. Collaboration between the two is crucial in bringing about change and instilling an innovative mindset across the whole business.
While innovation is not technology, technology often supports innovation. In fact, in today’s environment, a firm can scarcely consider itself innovative without the backing of an armoury of tech-powered tools and platforms. The advent of AI has provided challenge and opportunity to law firms in equal measure. Those who don’t embrace it stand on a burning platform. The pace of progress is relentless and the competitive landscape unforgiving.
Ability to significantly invest in these areas has historically been the preserve of the largest firms. This has presented a challenge to smaller and mid-sized firms as they seek to compete. But the difference in size brings its own advantages; being smaller can mean being more agile and having fewer walls of bureaucracy to break through. When done right, this can mean innovation at speed.
This is a challenge we embrace at Harbottle & Lewis, where we’ve established our own Innovation Fund used to invest in solutions designed to unlock opportunities from ideas generated across the business. This has embedded innovation in the foundations of how we operate and been an important driver behind our recent strong financial performance.
The pressure to innovate comes from many sides. Aside from the need to keep pace with peers, pressure increasingly comes from clients. Transparency is, rightly, an expectation and firms must explain to their clients how they are using innovation to improve efficiency and, of course, reflect this in their pricing. Not doing so can make the difference when appointing counsel.
We are way past innovation being an optional luxury. The degree to which this mindset is effectively implanted will be a material factor in distinguishing the firms who succeed from those who fall away.
