Why do internal consultants want to change their law firm?

The COVID pandemic has changed many things, one of which is how law firms work or how they choose a firm. Wolters Kluwer has carried out the survey “The lawyer of the future”, from which essential conclusions are drawn. This article analyses these conclusions and discusses the reasons that drive companies to change law firms.

Reasons why companies change law firms

Law firms’ advice is essential to comply with the law, save costs, and achieve greater efficiency. The Wolters Kluwer survey shows that 46% of consultancies consider it quite likely that they will change their law firm in the next year.

This survey highlights several reasons why companies want to change their law firm. They are the following:

• Lack of efficiency and productivity. Efficiency and productivity are two factors that have been gaining importance over time for companies’ legal advice when choosing a law firm. In fact, according to the survey in 2021 and 2020, only 52% and 41% of legal offices, respectively, asked law firms what technology they used to be more productive and efficient. The percentage has increased to 70% and is expected to reach 97% by 2025.
• Lack of staff equipped with the tools for the job. 84% of the legal offices surveyed consider it important to have staff equipped with the right tools for the job, and 41% maintain that it describes their current office very well.
• Low confidence that the firm responds to their needs. Over the last two years, lawyers and legal organisations have proven that they can work without physical contact. Still, for remote or hybrid work to work, trust, responsibility, and flexibility are essential.
• Insufficient specialisation in services. In the legal sector and other sectors, new fields of law appear, and 77% of those surveyed highlight the importance of emerging areas of compliance, such as that related to the Protection of Personal Data, environment, and gender equality. However, only 35% consider themselves highly prepared in these fields.
• Not using technology to offer the best possible service. 84% of the legal consultancies of the companies consider it essential that the chosen law firm can help in the selection and implementation of legal technology. On the other hand, 91% of consultancies think it will be important to have a law firm that makes the most of technology in the next three years. The most important technologies for corporate lawyers are legal affairs management, contract management/contract analysis software, document management, encryption and cybersecurity tools, electronic signature and corporate organisation (entity management).

About all of the above, the Wolters Kluwer survey shows that the three most important changes that law firms expect in the next three years are: greater specialisation of the legal services offered (88%), greater collaboration and transparency between offices and clients (85%), and greater use of technology (82%).

How to choose the right law firm for your company?

Choosing the right law firm for your company can make the difference between saving costs or increasing problems. These are the criteria to consider:

• Specialisation. It will help if you are looking for a law firm specialising in the matter you need, with knowledge of the sector in which your company works. Examples: incorporation of companies, Form 720, taxation of cryptocurrencies, internationalisation of companies or business consulting in different areas such as labour, commercial or tax law.
• Experience. The law firm you choose must have proven experience in advising companies. To collate the experience, you can analyse the law firm’s website, compare the experience of the different professionals that make up the team, analyse social networks and check the opinions of other clients.
• Accessibility. It is common for employers to complain about the difficulties of contacting or speaking with their law firm or the problems that there is not a single interlocutor who coordinates all the work and the relationship between the company and the law firm. For this reason, you should ask the law firm about the tools it uses to communicate with the client and monitor the actions carried out by the firm about your company.
• Confidence. Trust between the company and the law firm is built over time, but from the beginning, there must be excellent transparency and honesty to create a good relationship.
• Technology. Since technology has developed, hiring a law firm close to your company is no longer necessary. Ask the law firm you want to employ what technology it has to speed up advising on your business. According to the Wolters Kluwer survey, the result for 2022 is that 63% of law firms plan to increase investment in software to facilitate legal work, and 66% expect their investment in technology to grow in the next three years.

Along with all of the above, it is essential that you request several quotes before deciding and that you compare law firms not only for the price but also for the services they provide and the value they can bring to your organisation. Do not forget that it can be a crucial piece for the future growth of your organisation.

Finally, add that, on occasions, it can be helpful to have more than one legal service provider. Most large companies do this, as it can be a convenient format depending on the circumstances.