Technology is still a top strategic priority for law firms even though levels of investment in the last 12 months, according to a new report from HSBC UK.
The report, undertaken in partnership with The Lawyer magazine reveals that over four fifths (81 percent) of firms indicated that technology remains the most important area of strategic development activity for their firm, almost twice as much as the second priority to expand overseas (41 percent) and a merger or acquisition (28 percent) in third. Just over a quarter (27 percent) of law firm leaders in the UK’s top-100 practices said they would invest 5 percent or more of their revenue in technology projects, compared to 75 percent in two years ago, when there was heavy legal technology investment in 2017. The report also highlights geographical priorities for the next five years, with the majority (68 percent) focussed on UK operations with Europe (16 percent) and China (11 percent). Chloe Clift, HSBC UK head of professional services sector, explained “While investment in technology is clearly still a priority, law firms are pulling back from new and innovative technologies to focus on their ‘business as usual’ systems that lie at the heart of operating an efficient modern law firm,” adding “Products and services that were previously seen as innovative tech are now, in many cases, established and require minimal additional investment. It’s also worth considering that some firms may be delaying investment decisions until the future of the UK’s relationship with the EU is clearer.”
Client collaboration tools are the top priority in technology investment for 44 percent of firms, with preventing cybercrime (15 percent) moving down a notch to second place and AI down to 11 percent. Ms Clift said, “While an increase in revenue across law firms means that tech investment has grown in real terms, firms shouldn’t be complacent, particularly around investment in preventing cybercrime. Increasing frequency and sophistication means that cybercrime should remain a focus for firms who could suffer damage to their operations or their reputation in the event of a serious breach.”