Legal Tech for Transactional Lawyers Newsletter: #5
MBA CREF, ROI on transaction management, why prompt engineering will become less important, yoga and innovation, some fresh January article links and more!
Happy Friday! Hope you had a great start to the year. Certainly appears folks are hitting the ground running in 2024 and it is exciting to see legal tech momentum carrying over from last year.
If you will be at MBA CREF in San Diego this weekend please reach out! Would love to meet up in person and discuss how we are improving efficiency in the origination of mortgage loans.
In this edition I discuss ideas about how to determine return on investment in transaction management, provide links to some solid legal tech articles (great stuff to start the year - maybe the product of some well rested minds) and think about innovation and legal tech through the lens of a Sanskrit mantra.
Hopefully you find it useful and interesting. Please feel free to share with anyone that may be interested and have a great weekend!
If you find this content valuable, please connect with me on LinkedIn.
Leveraging Tech in Transactional Matters
📗 Realizing the Return on Investment in Transaction Management Projects
Transaction management is like selecting the "paperless" option for your bank statements. Once you do it you likely won't want to go back to all that paper and the old way...
That said, I sometimes have a hard time quantifying the ROI from transaction management features vs. more tangible tools like document automation.💰💵
With document automation it is very clear to see that you hit a button and computer drafts 10 -15 documents that would have taken ten several hours in a few seconds (rough math - 5 hours of attorney time at $700 an hour = $3500 savings).
For typical transaction management features like online checklists, streamlined closing binders, signature packages and other project management features, it can be a little less easy to see.
Often times, the true ROI is not calculated just on time savings, but rather stuff like:
😔Less Process Items to Remember in Your Head. You can move away from static Word checklists and create logic around tasks in the deal. This saves stress and reduces mistakes and last-minute closing scrambles because something is missing. Set it and forget it.
🏃♂️Speed to Closing. Better organization and automation of little things creates more velocity to close deals fast and efficiently. Features like automated signature packages, one-click assembly of documents and building out closing sets as you go speed things up a lot.
🤼Better Information Sharing Among the Deal Team. Documents can be organized on a checklist and uploaded to one place instead of in an unstructured deal room or circulated via email. This reduces emails and your inbox and everyone can go to one place for everything.
📚 Consistency of Execution Across Outside Counsel and Deal Teams. This one is often overlooked as historically consistency was achieved by manual quality control and in-person management of the deal team. With transaction management you can set the rules, formats and requirements once and reduce the hands-on management needed to achieve perfect consistency.
Articles and News
🏆Productivity-Based Business Models for Law Firms?
A number of really good thoughts to consider and debate both on the law firm side and the client side as we re-imagine the AI-powered law firm business model in another great article by Jordan Furlong. Especially the concept of selling the outcome itself and the client's experience in getting there vs. the time it takes to achieve the outcome. Excellent client service already focuses on this, minus the time spent component, so maybe it isn't that much of a shift. The law firms that figure out how to transition where appropriate away from the billable hour and toward a productivity-based business will be in a great position in five years. This will not be easy, but excited to see what new legal services based business models are born from this era.
🚫Prompts Must Go
Could not agree more with this post by Bill French that details why the future of GenAI will be prompt free. The more complex and nuanced point solutions that leverage GenAI will not require the user to write prompts. The software developers / subject matter experts will be responsible for crafting prompts that work perfectly within the product (and are free from errors and inconsistencies) and prompts will be checked into repositories just like any other code.
📚 OpenAI Releases New Models
OpenAI released several new GPT and embedding models and decreased pricing. The new GPT 4 model is cheaper and offers a 128K token limit (which is helpful for large documents) and it also claims to reduces cases of "laziness" where the model doesn't complete a task (amazing this is part of the release notes). They also released a GPT 3 instruct model that is supposed to be better at following instructions. We are testing this now in the context of some of our more detailed prompts - if it works just as well as GPT4 then it will be very useful in developing apps from a cost standpoint.
❓Q&A - Driving Innovation in Law Firms
Nice Q&A from by Fred Melanson at Macro and legal tech expert Colin Levy on innovation tactics at law firms. So many great insights here, but love (i) graphic re: innovation starting with end users (not partners and IT), (ii) concept of collaboration between clients and lawyers - need to see this more going forward, (iii) starting small with friendly innovators and then moving out to rest of firm (see my prior post), and (iv) remembering that sometimes you have to fix process first before applying tech to it. Definitely worth the read!
👑Shared Client and Law Firm Role In Selecting Legal Tech
This short ILTA blog post by Christiane Matuch discusses how clients and law firms can work together to select tech stacks that can be used to improve efficiency both in collaboration and internally at law firms. A good reminder for attorneys to dig in and learn new tech so they can share it with their clients as a trusted advisor and add value to the overall representation, especially in light of all the new AI tools.
🧘♀️Yoga and Innovation
My daily routine is to do yoga every night sometime between 11PM - Midnight - as a father of 4 little kids this is the most consistent time to block for myself.
One of my favorite Sanskrit mantras from my practice that I like to meditate on which I think can apply to all aspects of life (even the practice of law and legal tech) is "Lokah Samastah Sukhino Bhavantu". Translated to English:
"May all beings everywhere be happy and free, and may the thoughts, words, and actions of my own life contribute in some way to that happiness and to that freedom for all."
🌎 Lokah Samastah means the whole world, but it can refer to any world or realm or universe. Let's think of this as the entire legal ecosystem - law firms, corporate law departments, business teams, tech vendors and other service providers like ALSPs.
😊 Sukhino is from the word sukha or sukhin, which means happiness or joy. This is subjective, but in this context I think of this in quality of life for attorneys and staff and overall client satisfaction with transaction outcomes and legal costs.
🤼 Bhavantu means “may everyone." So this means not just BigLaw and corporations with unlimited resources, but everyone should have the opportunity to have their experience enhanced by legal tech and teams delivering these services should be diverse and inclusive.
The last part of the translation is thinking about how your own thoughts, words and actions can contribute to everyone else's happiness and freedom. There are so many things to consider as we live this out, but a couple that come to mind when applying this mantra to legal tech:
🧬 Diversity in teams should be prioritized and minorities and women should have a prominent spot at the table in implementing and designing solutions. We should always look to be inclusive in staffing and implementing projects.
😎 If legal tech can automate the most mundane and soul crushing tasks performed by junior (and senior) attorneys, then quality of service can remain the same and mental health can be improved. It also frees up attorneys (who are very high performers and smart) to spend more time on creativity and process.
⚡ Clients should be happier as transactions will get done faster with more accuracy and consistency in legal fees.
🌎 Legal tech has the opportunity to be a great equalizer in the access to high quality legal services as the technology gets better and costs of access come down. Tools should be priced according to the market they are serving if possible to enable broader access.