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Why the business of Law is changing

Why the business of Law is changing (Video)
Welcome to week one, where we’ll examine the background to the changes currently happening within the legal profession. This week, we’re gonna look at what lawyers do, the market for legal services and the impact of technology on society. But let’s start by looking at the learning outcomes for this week. The aim is that we can take these off by the end of the step. So I’m gonna look to explore how the legal profession and market for legal services operate, and to describe the effects of huge advances in technology in the profession and on society in general. Traditionally then, lawyers are split into solicitors and barristers.
The main difference being that simply barristers tend to practice as advocates in court, whereas solicitors tend to work in offices. There are however these days and crossovers for example, semester advocates. But as a general rule, solicitors work out of law firms, of which there are many types and sizes from small office on the high street to huge firms in the City of London. But all of them tend to be structured like a pyramid, lots of junior lawyers, slightly fewer senior lawyers to manage them. And then the partners who run the firm share the profits and carry the risk at the top. Barristers on the other hand, tend to work in chambers, and they usually self-employed.
The chambers has clerks who keep the chambers diaries up to date, calculate them, negotiate fees for the work. And the barrister pays the chambers a rent, which is usually a percentage of their income. In today’s legal marketplace though, there are more than just solicitors and barristers. There’s also legal executives, notaries, licensed conveyances, patent and trademark attorneys, and costs draftsman. Upper legal profession does share, there is a model. That is the client goes to see them gets the advice, and they’re sent a bill for the lawyers’ time. So who buys legal services? Well, the obvious answer is business, from global giants to a business run in someone’s living room.
Every company needs the help of a lawyer to navigate the complex web and company law. But there is also a family law, criminal law, property law, employment law, wills and probate, and environmental law, human rights, tax, and many, many more asides. Within this, you’ll notice that most of the services are for everyone, not just big companies, divorces happen, wills need to be made, people move houses or have issues at work. And what’s important is that everybody has access to these firms because that’s a part of this thing called the rule of law. It’s not hard to find criticisms of legal services though, Google lawyer jokes you’ll see exactly what I mean.
And one of the biggest criticisms about lawyers is the cost. As we saw, lawyers tend to charge for that time, and many clients feel that hourly billing appears not to be an enormous incentive to become more competitive. So there’s also this perceived lack of competition. The idea of cost also raises argument or access to justice, mainly the idea that the more money I have the better lawyer I can afford. And whilst that’s not necessarily true, it is certainly an idea expanded by the media. With all this in mind, and for various other reasons, the Legal Services Act 2007 was introduced and it fundamentally changed the legal landscape in England and Wales.
One of its aims was to introduce or throw to increase competition, flexibility, transparency, and choice for consumers of legal services. And it did this in part by allowing for the first time non-lawyers to run law firms. These alternative business structures or ABS is, mean that established big companies can get involved in legal services. At the time this was dubbed Tesco law because it opened access to all kinds of companies like supermarkets to enter the marketplace. It didn’t quite happen as expected and companies were slower to take up legal license system previously thought. The court of legal services did and have grown to employ over 600 people. The other quick criticism of lawyers is how slow they’ve been to embrace technology.
The problem is that, this is now catching up on legal services and there are several reasons why. But to really understand all this, we need to look at how tech has infiltrated and changed society. The starting point here is Moore’s Law. And that’s the idea that the number of transistors and resistors on a chip doubles every two years. And it’s absolutely central to understanding how technology has had such a vast expedient impact on society. This is the reason why mobile phones, iPads, laptops can become smaller, lighter, quicker. And like Bill Gates says, it really has made remarkable things possible.
If you consider in the last 18 years, UK mobile phone ownership, UK home computer ownership, and UK Internet connections have doubled. It’s here when you start to see that technology is not just transforming our daily lives, it’s transforming the way that we interact with business. Think of all the apps on your phone and the many possibilities at your fingertips, you can transfer money across the world in seconds, consult a doctor or the vet at the touch of a button. You can order a pizza or a taxi to your door, set up a direct debit, do your shopping.
The possibilities are endless, but 20 years ago to do almost all of these things, you’d have had to go somewhere or have a conversation with anybody. Search engines do have a part to play. Most people who need legal services will start with Google, where again, 20 years ago that they’ve used word of mouth or a phone book. Business now has to look at the client journey, that is how their client reaches them in detail. That needs to be a solid website with excellent SEO advertising to familiarize potential customers. All this so that when a customer does need to find a service, the company are right there in his mind. And it also opens huge possibilities.
He considered for a second that three of the most recognizable companies on Earth are all web-based, Amazon, Facebook, and Uber. And furthermore, Facebook does not produce its own content and Uber, it doesn’t own any of its own taxes. The final piece of the jigsaw is the tech available because it’s not just mobiles, tablets, and the internet. Automation and artificial intelligence and how capable of performing even the most mundane of tasks. And whether it’s remembering your purchase history, sending out invoices based on time recording, or searching through documents, it frees up professionals to become more specialists and more niche. I’m gonna explore this in week three. But as is clear, 21st century business operate in new ways.
Tech has allowed us to reach more people, to make transactions and jobs quicker and more efficient. In the law, the Legal Services Act has open new doors for alternative business structures to compete with traditional law firms and all this is starting to threaten the traditional models. This is why in part the legal profession is changing. So if we return to the learning outcomes, hopefully you should now be able to tick off the first to explore how the legal professional market for legal services operate. And describe the huge effects and the huge advances in technology on profession of law and on society in general.
To make sure you’ve met the outcomes, there is a quiz on the next step just to test your knowledge. Thanks for listening, see you next week.

Before we learn about the future, it is important to address the past. To examine why the legal profession is changing it is important to look at the historical reasons and the pressures faced by business of all types in the 21st Century.

Do you think there are other reasons too?

Please do not forget to put your comments below.

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Introduction to Innovation and Technology in Legal Services

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