Legal Reimagined- Tips for the contract management process
Legal Reimagined- Tips for the contract management process

The State of Legal Workflow Application Adoption

Legal workflow application adoption has, for years now, been in the forefront of digital transformation within legal departments.  How has the pandemic impacted it?

According to CLOC’s research, legal departments saw the automation of legal processes as the second-most important priority in 2021: 57% said automation was a high priority, and it’s been a primary focus for corporate legal transformation for several years.

In other words, the humble legal workflow application has ascended to the status of being a cornerstone technology.  According to Gartner,

Despite the hype surrounding the field, automation isn’t a leap of faith. Even in 2019, the average legal department reported that 33% of its corporate transaction work was automated. There is room for more: In the same survey, legal departments reported that 55% of their work on corporate transactions was automatable.

Coping with COVID and the “Great Resignation”

Legal workflow application adoption empowered legal departments to swiftly implement processes in response to the pandemic, such as for tracking the ability of outside counsel to continue to deliver services, or measuring DEI progress even during disruption.

But legal departments are discovering some less obvious, but still important, benefits of automating.

One surprising effect of the COVID-19 pandemic in the legal industry? It caused a “Great Resignation” of its own.  In March 2020, the turnover rate within legal departments and law firms reached a record high of 9.7%.

On average, an employee’s departure will cost a company 33% of their annual salary, so you can imagine the costs of replacing highly paid legal staff.

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Legal workflow application adoption can drive retention, not resignations

Automating mundane legal tasks, such as NDA processing, so staff can work on more rewarding projects is one way in which a legal workflow application can help retention.  But another benefit? It can temper the loss of the institutional knowledge represented by the departure of attorneys or other legal staff.

By embedding vetted best practices within automated workflows, the enterprise can retain institutional knowledge within proven processes.  This also includes data on what best practices were more productive, which activities consumed the most time, and so on, allowing leadership to hone those processes.  They’re then able to onboard new employees into workflows that have already been tried and tested.

As legal departments increasingly reach across departmental boundaries, they’re able to pass along these optimized processes to other business units, equipping them with automated workflows that have a certain legal “expertise” already woven into them.

The benefits of legal process applications have been widely proven in practice: 64% of in-house legal departments say technology has resulted in better workflows for attorneys.

What’s the future hold?

Our own survey, conducted with ALM in early 2021, found that 77% of corporate legal departments anticipated their use of a legal workflow application was going to increase this past year.  We’ll be conducting a similar survey as we head into 2022, and the results should be revealing.

Now that legal workflow applications have become more prevalent, more legal leaders are seeing the potential that lies in extending legal best practices across the rest of the organization by embedding them in optimized workflows used by multiple business units and departments.

Look forward to a “second wave” in legal workflow application adoption, driven by that desire and also by the increasing demand for legal tech stacks capable of providing stability, scalability, and productivity long into the future.  Only future-proofed legal workflow applications with the flexibility to evolve will be an adequate cornerstone for those stacks.

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