How to Build a Business Case for In-house Legal Technology?

Doing more with less have been the bywords of in-house legal departments for over a decade. We are under pressure to work smarter, deliver excellence, project manage and prioritise within an unrelenting landscape of legislative change and amid the pandemic. 

For some in-house legal departments, this means prioritising legal work to favour high impact, strategic work. For others, this has meant automating repetitive tasks and streamlining approval processes; in other words, avoiding the in-house legal team being seen as a rubber stamp in a process. In either of these scenarios and for everyone anywhere between, what we all want as in-house lawyers is to do meaningful work and use our skills to have an impact on the organisation we are supporting.

When it comes to choosing and implementing technology for the in-house legal team, the motivation is the same: we want to choose the right technology for our team and our organisation, and the most impactful technology to help us do more, with less. 

“Our corporate department customers have seen a recent increase in the recruitment of dedicated legal operations staff to drive internal efficiencies in the delivery of their legal services.”

Additionally, Samantha observes that in-house legal teams often feel like there are not enough hours in the day. All consumed by high-volume low-complexity tasks, there is little space to step back, strategise and improve how they service the business. 

“Adopting expert legal tools like Practical Law adds immediate value in their forward-thinking journey by equipping them with resources that prompt efficiency,” Samantha concludes.

There are a plethora of technology-based systems available to in-house legal departments, from e-billing, matter, document and contract management, research and knowledge platforms, digital signatures, intellectual property management, electronic litigation hold systems and artificial intelligence technology. 

A trap for beginners is choosing technology for technology’s sake. The first question should always be: what problem are we trying to solve?

Over the course of aligning your in-house legal team’s priorities, you’ve probably adopted a mission statement. The statement helps to identify your purpose, and how the legal department will support the overall business strategy.  It will help to highlight the pain points (or gaps) which, if resolved, would help achieve the legal team’s objectives and in doing so, the business’ purpose. 

Legal teams need to make their case for additional resources by demonstrating how the request ultimately supports the business’ strategy and adds value to their organisation’s bottom line.  Assessing from the perspective of the end-user (whether that is the in-house legal team, internal clients, or both) will ensure that the solution is more likely to solve the problem (the pain points, or the gaps, or both) and be successfully adopted. 

If you’re proposing the purchase of new technology for your legal department, consult closely with your organisation’s IT department to first determine whether existing company technology can be modified or upgraded to address the pain points or gaps. If it cannot, this is worth noting in the business case.

• Ask what solutions are available that directly address your pain point gaps.
• It's also worth making dedicated time to try the product that you are proposing to purchase in practice, rather than just looking at a website or borchure.
• Ask for feedback from anyone within your network who is using the solution. 
• Ask your supplier which other organisations are using similar technologies successfully and ask for testimonies or to see the technology in action.
• Ask about the implementation timeframe and what ongoing training is available. 

Data is king. Assess how your in-house legal department’s time is spent during a monthly and/or quarterly period. Focus on what type of work is performed, and how this correlates with the legal department’s mission statement and the organisation’s strategy. 

Instead of highlighting the obvious point of how busy your team is and how many hours they are doing, try demonstrating the specific tasks each team member of the in-house legal department has contributed against the ideal of what they could be doing if the right resources were available.  

Back up this data with external sources, surveys and reports. For example, the Thomson Reuters Institute’s latest report, Legal Department Operations (LDO) Index 2021 (Sixth Edition): The risk of being left behind presents results and analyses legal operations trends from 1500+ global corporate legal departments finding that “Spending, technology, and department management are the issues that are top of mind for many corporate legal departments”.

If looking to implement a time-saving legal know-how and research solution for an in-house legal team, the statistic that ‘over half of corporate counsel spend up to three hours a day conducting legal research’ would be a relevant data point (Thomson Reuters, Tech and the Law 2022 report).

Putting forward a business case that offers real business benefits and scope for improvement will make your proposal much more appealing and more likely to be approved. For example, if your organisation’s priorities include reducing costs, proposing a solution that reduces spend on external counsel is far more likely to be approved than one that will have the effect of increasing outside counsel costs. It is also worth highlighting how the new technology will help the in-house legal department flex to meet new and unanticipated influences on the business. 

Most business cases will require a cost-benefit analysis to be completed showing the length of time before the technology is expected to “pay for itself”, and the projected cost savings for the organisation over time. Some legal departments use return on investment (ROI) models to help them make the business case for purchasing new technology: ask your proposed supplier for examples of these to support your business case. Also consider making the request as part of the annual legal department budget.

1. The current situation.
2. Where your team's work is focused.
3. Your analysis of the challenges, risks and opportunities that are ahead for your organisation.
4. The benefits and value that the new resource will bring.
5. The costs: direct, indirect and contingent.
6. A comparison with alternative options (if any).
7. How your proposal will support the organisation's goals and objectives, add value and control risks.  

Congratulations! Be mindful that an approved business case is just the start. If you’ve been successful in achieving funding, you’ll be looking to start the implementation phase. You’ll want to take the in-house legal team and your internal clients with you on the journey using the new technology, and to make it a positive one. Get the team on the tools, chart usage and user feedback. Identify champions within the in-house legal department who will support you during the implementation phase.

Acknowledge that adopting modern technology is part of change management and use a suitable change methodology and communication strategy to guide your in-house legal team through this process. It’s vital that your technology is actively adopted by the in-house legal team (and that they don’t simply adapt practices to it).

All is not lost! A strong business case will have set the legal department’s expectations with the decision-makers in the business. Continue to track your data points, and then ask for another meeting to re-present your case in a further quarter’s time. Ultimately, you will succeed if you can demonstrate that the benefits of your case outweigh the cost of the new technology resource.

Thomson Reuters offers high-quality legal content solutions, such as Practical Law, to help customers with all of the priorities cited by corporate law departments in the 2021 LDO report. Our legal software solutions such as HighQ are exactly the tools that legal departments are looking for to help them deliver on efficiencies and align with stakeholders using metrics and data. 

Practical Law's In-House Centre contains detailed guides on using technology to increase efficiency, making the business case for a technology investment and delivering change within the in-house legal department.  

You are one step away from accessing Practical Law’s complementary practice notes on building a business case for in-house tech. Complete the form below to get started.

This article was originally published by Thomson Reuters Insight.