Why are legal departments increasing their tech spend?
Corporate legal departments are expected to spend a significant portion of their tech budgets on e-billing, contracts and matter management tools in 2022. However, as COVID-19 highlighted, tech budgets aren’t immune from global events. Still, industry observers said high inflation, the Great Resignation and the Ukraine-Russia War haven’t spoiled in-house legal departments’ tech spending, yet…
Focus on Operations
Corporate legal departments are keenly focusing on three crucial areas of their operations; spending, technology, and department management – according to sixth edition of the Thomson Reuters Institute LDO Index. Sourced from more than 1,500 corporate legal departments and a Thomson Reuters survey to which 100 legal departments responded.
While legal departments are bringing work in-house to improve efficiency, they’re also looking at ways to stretch their external legal spend as well. In-house departments are looking very carefully at those high-volume, low-risk activities.
New providers continuously come into the market and bring a combination of people, process, and technology to get legal work done effectively.
Legal Technology Predictions
Legal technology budgets are predicted to increase threefold through 2025 as general counsel face unprecedented pressure both in terms of managing legal workload and driving efficiency in their departments, according to Gartner, Inc. The COVID-19 pandemic created more work for in-house legal departments at a time when headcounts are likely to remain flat, at best, due to economic constraints.
Legal technology spending has already increased 1.5 times from 2.6% of in-house budgets in 2017 to 3.9% in 2020. Gartner predicts legal technology spending will increase to approximately 12% of in-house budgets by 2025, a threefold increase from 2020 levels.
It seems that many legal leaders don’t have any scope to increase headcount or outside counsel spending at the moment, so they are likely to look to technology to maximise the productivity of their existing investments in personnel.
Legal departments are expanding their use of technology to support workflows and meet productivity demands. Therefore, developing a comprehensive, technology strategy that can adapt to changes in the corporate environment and advancements in the technology market will be critical to success. Blue Car Technologies can help to digitally transform your business. Contact us today for more information.
