The Search for the Missing Middle
Back in 1998, I was a partner and head of strategic development at a large commercial law firm. We were about to change all of our key systems ahead of the year 2000. There were a lot of reasons for this, not least the looming Millennium Bug, which turned out to be more of a stumbling mosquito with barely any impact.
The systems we were putting in were Aderant, PC Docs and Interaction. I would like to pretend we were being innovative, but in reality, we were modernising our core infrastructure software with what was then some of the best of breed systems at the time. We were adopting the typical large law firm structure of PMS, DMS and CRM despite this model being well worn and mirroring the approach we and many firms already had in place.
Fast forward to 2021, nearly 25 years later. What has happened? Well in short more has happened on digital and technology in the last 5 years than in the previous 20 years. The market pressures have increased massively: productivity, more law per hour, reporting, automation, client databases, start-ups, PropTech, data transfer and data science, the list goes on. And so, the question: why are law firms still putting in place systems which follow the same set-piece model as 25 years ago? PMS, DMS and possibly CRM and very little else in terms of principle systems. I am not saying you shouldn’t do this. You totally should, many of these systems are very good and are tried and tested. However, in a period of unprecedented change and demand (digital and non-digital) these systems alone surely can’t be enough? Why has the basic operating model not altered? If law firms had only just been invented would you build them like this or adopt a new model much more suited to modern-day working practices? How can the same model be right given the dramatic change in demand and the marketplace?
Smaller firms have, by contrast, operated with combined PMS and Case Management systems. Although the DMS functionality is perhaps not as strong it gives them what many larger firms lack, namely the ability to automate, to drive process, collect data and to report. Most large law firms find this harder and often don’t have end to end workflow tools. One Managing Partner I know put it well. She transitioned from an all-in-one system to a best of breed PMS and DMS. Whilst they were good systems the cost of ownership escalated and processes went to pot? She is now moving back to an all-in-one system due to the operating model being better suited for the demands they are seeing.
Some firms have the best of all worlds by leveraging best of breed systems and combining them with matter management systems, giving them a higher and more flexible capability stack. Ironically, there are not a huge proportion of firms operating with this model and it may be the reason that most firms have struggled automating legal work. Yes, they can do this but without such a system it makes every job harder, and the tech stack more complicated as new solutions need to be brought in.
Another client has been superb in stating the obvious. He openly says, “law firms have no data”. Okay, this is not strictly true in that they have documents, e-mails and financial data, but unlike volume firms, they have little or no data on the granularity of how they work. If they don’t have this, they can’t improve how they work. It also makes reporting and dashboards harder too. The traditional model alone does not deliver what law firms really need in data terms. Going forward every firm needs a Data Strategy, but how will non-volume firms deliver this with just PMS and DMS? They will be able to deliver something, but will it be enough? I don’t think it will.
MS365 has a huge amount of capability and can clearly bring a lot to the party and how law firms operate. However, will it ever solve these issues and how much work/how big a team would be needed to support it? I think MS365 could go some of the way towards filling this gap, but I suspect it will play a much greater role in replacing other software than plugging an enterprise gap like this. That being said some application layer SharePoint systems that span document and email management, and matter management and Power BI reporting bring a new set of offerings in this space.
So, what am I saying? To me, the historical PMS, DMS, CRM model is no longer enough. You absolutely need these foundational systems (or their equivalent) but to truly perform law firms need something else. Namely, the missing middle which sits amongst or above all of your traditional systems. Over 15 years ago I started looking for this with my then IT director. We were both passionate about the vision and had the budget but were never able to find that elusive element.
That is until now. Some new contenders have hit the market in recent years. Just imagine for a moment a system that would do a lot of the following, over and above your traditional systems:
- A system that gives an interface and information that lawyers really want, with PMS systems being relegated to the background. (Have you ever met a lawyer who wanted to work with a PMS system?).
- The ability to collect valuable data points.
- The ability to apply end to end workflow without buying point solutions.
- The option to extend out to clients, other providers or to subcontracted teams.
- No or low code, allowing quick deployment automation of legal delivery when IT resource is stretched and is not enough to support multiple legal group projects.
- Dashboards showing the core information lawyers want to see, as opposed to, say, finance dashboards alone (we think there are 5 “must-have” views).
- The ability to push out data to clients without using expensive file-sharing systems.
- Easy seamless reporting.
- The ability to act as an orchestration layer to ensure seamless data flow with other key systems whether they be playbook tools, PropTech solutions or Government systems.
- The improvement of supervision of work.
- The seamless combining of document and email management with firm processes putting real efficiency at people’s fingertips.
- The opportunity to apply real KM expertise to how non-volume legal work is delivered – to improve and automate processes in non-volume work.
- Being able to slice and dice views of the same data by office, by sector and by team and supplement it with other information such as news feeds and Government data.
- Proving better risk management and better supervision.
- The ability to do a lot and really improve capability whilst at the same time minimising your tech stack.
Some may see this as the stuff of fantasy, but it is now possible, and there are tools in the market that can deliver this for firms who really want to deliver a step-change in how they work.
This may not just be the missing middle; it may be the final piece of the jigsaw that enables firms to thrive in a way never possible before. The missing middle may finally allow firms to truly get under the skin of automating legal work in a way never previously achieved. It may be the toolkit both lawyers and IT departments need to really raise the bar on efficiency and client service. In a post-Covid world of hybrid-working this probably more important than ever.