What Legal Will Look Like in 2021 – And In The Future

image shows the future of legal tech

The past year has been a very special year and the pandemic has affected us all in many ways. With greater demands for remote work and collaboration, we have been forced to speed up our digital transformation. 

We have previously testified that times of crisis force us to adapt and be creative in order to survive. The question is; how will this pandemic affect the future of legal tech in the industry in 2021?

Legal tech on the rise

The Thomson Reuters Legal Department Operations (LDO) Index let us know that the pandemic has already forced adjustments in technical implementations. No less than 27 percent of legal departments answer that they have implemented more legal technology solutions due to the pandemic. Not only for all its benefits of making the work more smooth, but also because many businesses see the importance of spend and matter management, such as contract management, document management, and legal research.

image shows woman with easy document and contract workflow

Mary Shen O’Carrol, Director of Legal Operations, Technology and Strategy at Google, is convinced that this is the right time to put more resources and investments in legal activities. She believes that the industry will look very different in the future, and lawyers must be ready for it. In an interview with the Asia Business Law Journal, she says that difficult times drive change, because it entails increased demands on efficiency and streamlining, to create added value for the company.

Already today, technology can solve many of the everyday routine tasks in legal business. In the future of legal, there will be even more advanced tasks handled by robots, such as patent registrations and contract drafting.

A future for change in a conservative industry

According to Future Lawyer 2020, about two thirds of surveyed organizational lawyers believe that legal tech will be the most governing factor for the industry’s development in the future. This indicates that the industry is now actually ready to let legal tech optimize the legal business. In the same survey, we also learn that the organizational lawyers think that new business models will probably greatly affect the industry onwards.

image shows woman in conference room handling contractsHowever, implementing legal technology at scale could be a challenge. As many as 9 out of 10 believe that the need for technical knowledge among lawyers will increase, but at the same time, a clear majority of those surveyed state that they perceive the legal industry as conservative. Also, almost two thirds of the respondents believe that the industry is bad at encouraging new thinking. This indicates the industry needs a push to be able to change.

As 2020 forced many of us to rethink and re-evaluate our businesses, maybe last year’s challenges have been that necessary push the industry needed in order to start using legal tech to a greater extent.

The quest for efficiency

One of the biggest changes in 2020’s Legal Department Operations (LDO) Index compared with the previous year’s index is the sharp increase in the number of departments having operational staff, an increase from 57 % to 81 %. This indicates that there are changes in how departments are organized and how tasks are distributed between different roles.

Among the most pressing challenges that legal departments consider is that they continue to face a growing workload – no less than 68 percent testify to an increasing work volume. The reason for this seems to be an increase in the total number of legal issues handled. To deal with this, many choose to increase their spending on external lawyers as well as increasing the number of external law firms they use. At the same time, more work is also brought in-house and their budgets for technology are being increased.

image shows group working efficiently

The Legal Department Operations (LDO) Index also shows that departments clearly prioritize improving internal efficiency. This is done by using technology to a greater extent, in order to simplify their workflow and improve legal operations efficiency. Almost half of legal departments have increased their use of technology tools in the past year and 30 percent have increased their budget for legal technology. This indicates that the use of legal technology will continue to increase further on.

Improved processes and collaboration

Many are those who have already discovered how legal tech streamlines and clarifies processes for everyone involved. Collaboration becomes more efficient and more systematic by securely collecting data in one place, offering control over important dates, sharing documents for revision as well as archiving.

The Digital Maturity Benchmark 2020 also let us know that almost 9 out of 10 of the legal companies in the Nordic region plan to use digital tools and solutions to a greater extent within three years. They also prioritize structuring their internal processes as well as giving the business more room for self-control. A quarter of the companies also think that their processes need to be improved, although they have not yet planned for it.

image shows people working with legal contractingBy improving their processes the legal department can also improve their cooperation with other departments. Almost a third of the companies in the Nordic region have already made improvements in this area, and just over a third have realized the importance of improving their processes to achieve better cooperation with other departments. Also, about 20% agree that they need to improve their collaboration within the organization without having planned any initiatives yet.

In the areas of cooperation, contract management and e-signatures, legal departments in the Nordic region see themselves as more advanced than in Central and Southern Europe. This could be due to the fact that companies in the Nordic region are smaller and therefore find it easier to both work close to the entire organization and are able to drive change. However, the trend of using legal tech tools like this will most likely increase in the rest of Europe further on.

Streamlined contract management

Contract management can take up a lot of valuable time and effort from corporate lawyers. It is therefore a wise decision to review the possibilities to facilitate both the legal department and the rest of the organization with smarter working methods. By digitizing processes, the organization can more easily and efficiently create, sign, import and archive their agreements and documents.


image shows woman with successful contracting system

As many as two thirds of the companies surveyed in Digital Maturity Benchmark 2020 state that they have already improved, or are planning to improve, their handling of contracts and document proposals, redlining and version management.

The Digital Maturity Benchmark 2020 also shows that Nordic companies plan on giving their organization more autonomy. By streamlining operations, larger companies seem to value a do-it-yourself approach. To be able to do this, legal departments can provide the organization with tools like e-signature and predefined contract templates. This saves a lot of time since there is no need to rely on paper documents being sent back and forth, or creating contracts from scratch.

The importance of legal technology

Since companies are tasked with controlling and predicting their expenses to a greater extent, technical solutions will play an increasingly important role further on. With technology, many things can be handled better and more efficiently, such as cost savings, faster data analysis, clearer decision-making and the ability to streamline repetitive tasks.

image shows computer running contract management softwareAccording to Legal Department Operations (LDO) Index, the most important areas for technical solutions seem to be the management of spend and matter management, such as contract management, document management, legal holdings and legal research. At the top of the shopping list for future of legal technology are tools that enable expense and case management, such as contract management, document management, legal holdings and legal research rounding out the top five.

This is consistent with the observations we see in the Digital Maturity Benchmark 2020, conducted by Wolters Kluwer. This report also shows a trend in implementing legal tech on a greater scale. When asked, a clear majority of legal departments in the Nordic region see a value in implementing legal tech within a three-year period.

Overall, the companies surveyed in Digital Maturity Benchmark 2020 agree that legal departments can increase their contribution of value to the organization by having a clear digital strategy. Compared to Central and Southern Europe, legal departments in the Nordic region lag behind when it comes to both defining and implementing a digital strategy.

Let us summarize

Companies are always looking to improve their efficiency, especially in times like these. The pandemic, as well as other reasons, have forced businesses to be creative and find new solutions. As legal tech can solve many of the challenges businesses are facing, they now seem to understand the importance of allocating resources and increasing their budgets for technology.

One of the most driving forces for legal tech is the ability to control and predict costs. Many businesses have already discovered all the benefits of using legal tech, and others are planning to use legal tech on a greater scale in the near future. Only in the Nordic region we see that a clear majority of legal departments are planning to start using legal technology more extensively within a three-year period.image shows people in office working with legal contract and document management

Legal departments also clearly prioritize improving their internal efficiency. The quest for efficiency combined with the increase in workload makes legal departments carefully evaluate how they should be organized and how they can distribute different tasks. This is why as many as almost half of legal departments have increased their use of technology tools in the past year, and one third of the remaining departments have increased their budget for legal technology.

Moreover, by giving the business more room for handling contracts themselves, legal departments can improve their internal processes as well as their own efficiency. By doing this, their collaboration with other departments will improve. When digitizing those processes, organizations can more easily and independently create, sign, import and archive their agreements and documents — meaning more time for the legal department to focus on other tasks!

Legal tech has been on the rise for some time, and we predict it will continue in 2021. In the near future, trends indicate that legal tech will be implemented to an even further extent.

Although digital transformation in the legal industry may seem slow, digitalization seems to take an increasing role in corporate law from now on. More than ever, the industry has to be ready to let the future of legal tech optimize business.