Category Archives: Technology

2015-03-05 14.53.15

Three steps to the future

In the last two blog posts, I looked at the limits on improving productivity compared to growth, and suggested that real changes in yield come with improved working practices and products or services that do not depend on contemporaneous fee-earner input. Coincidentally, yesterday I saw a very good explanation of the issue (defined as ‘the problem of constant cost’) in a guest post by Michael Mills of Neota Logic on the Beaton Capital blog.

…quantity in legal services is not necessarily a good thing. We have the diseconomies of scale—internal coordination costs, quality variation—but not enough of the economies, other than branding and cross-selling (when it works).

In short, law practice missed the industrial revolution. We didn’t build power looms, and we certainly didn’t build Jaquard looms, programmed by holes in paper cards (the model for the 80-column, cropped-corner punch cards of computing’s adolescence).

Forget about billable hours, alternative fees, and ABS’s. The problem is constant cost.

Neota Logic’s systems are good examples of the kind of thing I described in my last post — a combination of knowledge and technology increasing law firm productivity. This and systems like it are an inevitable future for firms. The problem, I think, is not in creating these new ways of working, but in ensuring that when they are developed that they flow into the firm as well as possible. How, in other words, does the innovative become the norm?

New embedded in old at the Royal Exchange Theatre, Manchester

As technology teams have faced this problem for longer, it is not surprising that a model has been created to describe how an IT function might be structured to allow it to deliver new things while continuing to support existing products and services. Gartner has invented ‘bi-modal IT’:

the practice of managing two separate, coherent modes of IT delivery, one focused on stability and the other on agility. Mode 1 is traditional and sequential, emphasizing safety and accuracy. Mode 2 is exploratory and nonlinear, emphasizing agility and speed.

But these are two complete opposites, and the gap between them is cavernous. Unsurprisingly, things can fall into the cavern and never escape. Simon Wardley (whom we have met before) is scathing about Gartner’s idea:

I couldn’t stop howling with laughter. It’s basically 2004 dressed up as 2014 and it is guaranteed to get you into a mess.

Wardley’s alternative is a system with three parts rather than two.

When it comes to organising then each component not only needs different aptitudes (e.g. engineering + design) but also different attitudes (i.e. engineering in genesis is not the same as engineering in industrialised). To solve this, you end up implementing a “trimodal” (three party) structure such as pioneers, settlers and town planners which is governed by a process of theft.

The three roles are summarised neatly in this diagram (taken from Wardley’s blog under the Creative Commons Attribution-Share Alike 3.0 License).


The bi-modal model advocated by Gartner only considers the two extremes — pioneers and town planners. Filling the gap with a specified role or function helps to prevent the work of the pioneers being rejected by town planners for being undeveloped. As Wardley puts it:

The problem with bimodal (e.g. pioneers and town planners) is it lacks the middle component (the settlers) which performs an essential function in ensuring that work is taken from the pioneers and turned into mature products before the town planners can turn this into industrialised commodities or utility services. Without this middle component then yes you cover the two extremes (e.g. agile vs six sigma) but new things built never progress or evolve. You have nothing managing the ‘flow’ from one extreme to another.

(In an update to his original post, Wardley adds that a similar model was identified by Robert Cringely in his history of Silicon Valley, Accidental Empires. Cringely’s model used different archetypes — commandos, infantry and police. The relevant passage is in Chapter 12 of the book, published online by Cringely in 2013.)

Whichever terminology is used, the idea is the same.

The first wave of change is the responsibility of highly expert groups who work hard and fast to create products and services that might meet particular needs. Some of these might fail, but the speed of work is such that there is always something new to work on. In established businesses, this might be a dedicated research and development function, or it might be an activity open to all (as at Google, for example, where there was an expectation that everyone could spend 20% of their time on their own ideas).

When complete, the successful experiments might have proved their worth, but that doesn’t make them ready for widespread adoption. There will inevitably be some rough edges to smooth off, and some issues that could not have been foreseen until the idea needs to be scaled up for general use. That process of perfecting a new product or service is the responsibility of the middle group (the settlers or infantry). Some ideas may fail at this stage too — an idea that works in a lab may hit obstacles when it encounters real life and work.

Once a product or service has been proved worthy of inclusion as part of the core business, it still needs to be maintained and developed. That is the responsibility of the third group —  the town planners or police. As their archetypes suggest, this group needs to ensure such things as stability, good governance, predictability and reliability. But their work is not immune from disruption — as Simon Wardley’s diagram shows (click to embiggen):


Wardley’s model was designed with technology development in mind, and with the benefit of his extensive experience running successful technology companies. However, I think it is also a valuable template for development more generally in law firms (and probably elsewhere).

As an example, knowledge teams in law firms are now an established concept. They commonly work in similar ways when dealing with established aspects of legal practice. The fact that there is a lively market in Professional Support Lawyers between firms, and that many firms have created career pathways for those teams, suggests that this is a ‘town planner’ type of function. But that was not always the case. The first PSLs were experimental. They created their own roles: trying different ways of working, some of which were successful and some weren’t (the pioneer phase). As  firms became more familiar with the concept, they jumped on the bandwagon, perfecting the role in different practice groups and in different types of firm (the settler phase).

The same process can be seen at play in the way firms are adopting concepts like process-mapping and project management. Here, though, the pioneer phase can be massively foreshortened since these are concepts that have been tried and tested in different sectors before finding their way into the law.

Policing and town planning need to change when the context changes. Established knowledge functions need to pay attention to new ideas thrown up by pioneers. That message is at the heart of a recent call by David Griffiths for knowledge and HR functions to start disrupting themselves. When they do, they should consider how the three stages of development might be adapted to their situation.

Firms that cannot identify their pioneers need to consider where new ideas are going to come from. (Without those new ideas, the market will move on without them.) If they can point to a group of pioneers, but they expect ideas from that group to become part of ‘business as usual’ without additional work, they risk failure and frustration with the whole process. The latter situation is probably as bad as having no new ideas in the first place.

As usual, if you are keen to work out how these archetypes of development might work in your firm, we should talk.

Knowledge-sharing cars

I am ambivalent about the current efforts being expended by Google and others on autonomous vehicles. As a society we appear to have backed ourselves into a corner where the only way out is to shift a ton of metal alongside driver and passengers. Self-driving cars don’t do much to change this, and hand-wringing articles about how the trolley problem might be resolved by autonomous vehicles are a distraction.

Nonetheless, it appears that the efforts of Google and others will produce self-driving vehicles for the mass market, so it is interesting to look at the work they are doing. Google has been particularly forthcoming about their research, as shown in this TED talk by Chris Urmson, who has headed up Google’s self-driving car programme since 2009.

There is a lot of interesting information here about what Google is doing with its cars and how they are coping with real-world traffic situations. He is particularly persuasive on the safety point — human beings are responsible for many more accidents resulting in death or serious injury. If the future of transportation has to involve cars, far better that those cars are not driven by distracted and borderline incompetent human beings.

But the point I found most intriguing comes when we are introduced to the way Google’s car sees the world. (This runs from about 7’48” in the video.)

The starting point, basic driving on grade-separated highways, centres on perception (where the car sees itself and the other road-users in the world) and experience (what has happened before that might happen again). This is roughly where Google were when they started serious work in 2009. (What Chris Urmson calls “a geometric view of the world.”)

Once Google moved the cars onto city streets, there was immediately much more complex information to handle. The cars needed to be aware of objects other than other vehicles — pedestrians, animals, road works, litter, and so on. At this point, the cars need to be able to deal with a range of different signals — flashing lights on police vehicles or school buses, for example. They also need to judge and work around the behavioural expectations of other road users at a host of different levels — some signalled and some implicit. At 10’09”, Urmson tells us the key to their success in this effort:

The way we accomplish this is by sharing data between the vehicles.

At first this is just sharing information about the location of hazards like road works between vehicles, so that their shared understanding of the environment is constantly updated. Over time, this has developed into a massive shared database of all of the things that all of the cars have seen over time. Hundreds of thousands of objects have been observed by the cars in multiple dimensions. All these objects (cars, people, animals, cars, trucks, cyclists…) can be used by Google’s cars later on to help them understand novel objects and situations by comparison with what has already been seen and recorded. Further than that, this data can be used to build a model of how different objects might behave in the world — improving the predictive capability of the fleet immeasurably.

Google’s cars will always be better than humans in terms of their capacity for observation, speed of reaction and ability to deal with crises calmly and decisively. Urmson shows in detail how this is achieved even when a hazard is partly concealed by other traffic in the section of video from 12’30” to 13’24”. That gives them an edge as individuals. Their constant sharing of data is where the real differentiation occurs. They are constantly learning by sharing.

Humans will never have the processing capabilities of an autonomous car. But there will always be somethings that we can do immeasurably better than technology. The key to future success is working out what those things are and concentrating on them. But we can also learn from Google’s cars. By sharing what we know as widely as possible and actively using what is shared with us, we can develop a better picture of the world and act within it.

Your knowledge-sharing capability is almost certainly nowhere near as good as a dumb car. But the car can show you why you should be better at it. Google’s cars understand that more can be achieved by sharing than by hoarding. We should learn the same.

No visible means of support

Why your foundations matter

A couple of weeks ago, I challenged firms to think about what might be possible without resorting to technology. That post was based on an assumption about the nature of most law firms:

The tools, systems and attitudes of technology have to be imported into traditional law firms, therefore they are available to everyone without preference. (The status of technology within the firm is a relevant issue here, but I want to leave that for another time.)

This is that other time.

Every business is constructed around a core set of assumptions. Those assumptions include:

  • Purpose — why does this business exist?
  • Beneficiaries — for whom does the business exist?
  • Platform — what is the business built on?

The answers to these (and other) questions define the nature of the enterprise. Often they are unspoken, but generally there can only be one answer. A business might pretend to serve stockholders and customers alike, for example, but in extremis a choice has to be made between them. One group has to be favoured over the other.

No visible means of supportI want to look more closely at the third of these questions, especially in the context of legal businesses.

The traditional law firm could have a range of purposes, although some manage by committing vaguely to helping businesses and individuals with legal problems. The firm may exist to make a profit for its partners, or it may prioritise client service above partner remuneration. Most, however, are founded on delivering services using people with legal knowledge and experience. That is their platform. If you were to replace all the lawyers with different people, the firm would be a very different entity. That isn’t a likely occurrence, but firms that lose significant partners and other senior lawyers do collapse. We can see this also in the legal directories — The Legal 500 and Chambers and Partners compilations rank firms and lawyers.

It is instructive to look to a different sector for comparisons. In the car industry, a volume manufacturer may have some key personnel, but they are rarely crucial to the final product. Ford may have a carefully expressed design language, but the success of its cars depends more on the reliability and dependability engineered into them in the company’s massively automated production lines. Ford’s platform is a technological one — its people are much less important than technology in the final product.

Not all cars are the same — Rolls-Royce and Bentley depend on craftsmen to produce the finishing touches that mark their vehicles out amongst luxury vehicles. Without them, the product would have much less value in the market. The platform could also be a mixed one. There are high-end motor manufacturers like McLaren and Porsche where designers and high technology (such as composites and advanced gluing techniques) are both critical to the product.

Most law firms are more similar to Rolls-Royce and Bentley in that their platform depends on key individuals and a continuation of experience and craft. Those firms need to contend with the fact that the market values that approach to legal service much less than it used to.

Some of the new entrants into the legal market have done so with a completely different platform. Riverview Law is one of the most forward-thinking in this regard. They make it clear from the front page of their website that technology is at the heart of their work:

One of the key themes that differentiates us is the way we use dashboards, management information, analytics and visualisations to help in-house legal and related teams to make better and quicker decisions, manage risk, and evolve their operating models.

They even offer their technology to in-house legal teams.

I am sure the people at Riverview are really good at what they do, but it seems clear to me as an outside observer that the platform for the business is technology. The technology allows Riverview to provide a service that stands apart from what other legal businesses do. The people might come and go, but losing the technology would fundamentally change the nature of the business. No traditional law firm could say the same.

Another firm that depends on a technology platform is Inksters in Scotland. Brian Inkster and his colleagues have created a business around a set of cloud-based services that allows them to serve clients extremely effectively from any location. This mobility and flexibility sets them apart from other firms. The firm specialises in crofting law and other legal services for the widely-scattered and remote communities of the Highlands and Islands of Scotland, so their clients find it harder than most to get to a lawyer’s office. Inksters has offices, but they also have a ‘Flying Solicitor’ service, and they have provided ‘pop-up’ legal services in a wide range of different locations.

If Riverview Law is the legal equivalent of Ford, Inksters is more similar to the likes of McLaren or Porsche — using a blend of expertise and technology as the basis for a firm that can react quickly to legal need whatever the location. Both Riverview and Inksters depend on technology for their success, but Inksters has also stirred in a larger dose of legal expertise to create a unique recipe.

Riverview and Inksters are just two examples of new legal businesses built on technology foundations. There are others, and there will be more. That isn’t to say that all successful legal businesses must have such a foundation, but it is an indication of where growth will happen.

The problem for existing law firms is that they already have non-technology foundations — and you can only build on one platform. Most have bolted technology onto the work that they do, but there are limits to that approach. Some are starting to shift their work so that they can use technology in a much more fundamental way — DWF is a good example here. Over time, that technology could become so embedded in the way the firm works that it is considered part of the foundation. That is likely to be a long painful process, especially in a business where consensual decision-making is the norm.

Another approach would be to construct a new firm alongside the old one. The old firm could continue the traditional partnership, people-based model, whilst the new one made the most of new technologies and corporate structures. Over time, one would succeed (and it might not be the one with the technology foundation). For most traditional firms, this would be completely counter-cultural. Would clients care about that, or would they just gravitate to the legal service providers that best meet their needs?

Maybe it’s time for firms to start experimenting a bit more.

2014-07-02 19.40.40

What if technology isn’t the answer?

Most of the current thinking about the future of law firms (and other legal activities) turns on the use of technology. Richard Susskind has been in the vanguard, and the accuracy of his predictions has drawn law firms and technology suppliers alike to the same conclusions — improvements in the practice of law and client service in the future will depend heavily on technology.

I agree. Any firm that isn’t making technology investments is drastically reducing its chances of survival.

Old and new techBut that only means that enhancing legal practice with technology has become the norm — table stakes. Clients and potential recruits will increasingly shun those firms without effective technology. (And by ‘technology’ I mean not just IT systems, but also the improved practices and processes that come from a more structured approach to legal practice. Technology is as much a mindset as it is a collection of algorithms and data.)

If technology investment is unavoidable, everyone will end up in the same place once the fuss has died down. Apart from minor adjustments in position between firms (differences in the rate of adoption, for example), the rising tide of technology will lift everyone to practically the same degree. The tools, systems and attitudes of technology have to be imported into traditional law firms, therefore they are available to everyone without preference. (The status of technology within the firm is a relevant issue here, but I want to leave that for another time.) If one firm sees something that another firm has, in many cases it is not difficult to acquire it.

That situation is great for suppliers (especially those, like HighQ, that have a product which becomes the default tool for a particular purpose) and for clients (who can start to rely on firms to improve their service through the use of technology), but it may be a problem for firms. If everything you can have is also available to everyone else, how can you stand out from the crowd?

A few firms will have the first-mover advantage, but this is probably minimal (given the stickiness of clients) and brief (given that few developments are truly bespoke).

In order to find something that truly differentiates them, firms need to ignore the commonplace of technology. By assuming that there is no technology solution, they become freer to consider possibilities that might be truly novel and useful to clients.

It is commonly suggested that there is no real difference between firms. It may appear that way from the outside, but every firm is unique. It has a unique collection of individuals within it. It has a unique collection of clients (each of whom is also unique). It has a unique history, and a unique place in the present. But very few firms make good use of their uniqueness (which is why they appear so similar to observers).

Every firm has the capability to stand out by making good use of the knowledge that is uniquely contained within it.

Everyone in the firm has a partial and unique insight into:

  • The firm itself;
  • The people within the firm;
  • Their relationships with each other, and outwith the firm;
  • The firm’s market;
  • Clients and their behaviour;
  • Clients’ markets;
  • Working practices (in all sorts of businesses);
  • The law;
  • Technology and other pervasive changes in the world;
  • And so on…

Gathering these insights from across the firm can only help the leadership team see new possibilities for action that is uniquely fitted to the firm.

This has to be done carefully. Some popular methods (such as brainstorming, amongst others) may be less effective than they appear to be because of factors such as:

By using techniques to foster openness, dissent and diversity, coupled with simple constraints and support for emergent ideas, firms can start to make sense of their unique position in the world and then act accordingly.

If your firm is interested in finding its own way, or at least in knowing more about what might be possible, you know the drill: get in touch.

2014-11-20 12.11.23

People, technology, location: where should law firms’ money go?

Experimental archaeology is a favourite way for TV documentaries to bring the past to life for the casual viewer. The BBC is currently showing a new series looking at the construction of a 13th century castle, together with various other related mediaeval activities. In last night’s episode, the team made a crossbow and its bolt using only techniques and materials available in the 1200s. In the commentary, they kept returning to the fact that a crossbow allowed armies to be effective with much less training (one presenter gleefully told how Richard I had been killed in 1199 by a crossbow fired by a mere boy).

Horse and cattle trough in SmithfieldBy concentrating on the saving on training that the crossbow brought, above the longbow, the programme missed an opportunity to make a wider point about the impact of technology on warfare — it changes the way money is spent.

If your army depends on archers wielding longbows, you need to invest heavily in training (and in the peripheral expenses to maintain archers in training). However, a longbow was probably slightly cheaper to produce than a crossbow, which needed components wrought from iron (not a cheap resource by comparison with wood at the time). So, as crossbows become more widely used, it is likely that the budget for archers would shift from supporting training to the new technology.

This is part of a pattern over hundreds of years. The wars of the twentieth century were probably the last in which the size of an army or navy played a part in determining the outcome (directly or indirectly). Modern warfare is waged with small numbers of people and huge amounts of costly technology. (Sadly, the impact on humanity is just as devastating — possibly more so, as civilians become harder to distinguish from combatants.)

Longbows and crossbows are still capable of causing death and serious injury. Nothing has made them less deadly, but their power is meaningless in the context of modern warfare.

Law firms are in a similar position today.

For the past few centuries, the primary cost for a firm has been lawyers and their training and upkeep. In more recent times, larger firms have also spent large sums on acquiring and maintaining high-quality offices in expensive business locations. As salaries and rents increase, clients have ultimately had to bear the cost in higher fees.

Technologies that are now readily available (or in development) are starting to eat away at the traditional model. They cost more than the basic IT tools already in use (typically email and document processing and management). It is a reasonable assumption that a firm of the future will spend a much higher proportion of its budget on technology than it did in the past, and a lower proportion on people (some of their functions being done automatically) and offices (as people work much more flexibly, using mobile devices and in non-firm locations).

So it is interesting to read in the Legal Support Network’s Legal IT Landscapes 2015 report that the top 100 UK firms are not investing hugely on their IT:

Our results show that top 100 firms spend on average 4.1% of revenue on IT (there were some that spent 8-10%, so you can imagine the other numbers). Though this metric isn’t one I’d use alone, and it puts law firms squarely alongside other professional services businesses (according to Gartner), many would say that legal businesses should be spending more, to innovate and build competitiveness. Let me put that 4.1% figure in context, too: education, media and entertainment, and banking and financial services all spend more – banking’s spend on IT as a percentage of revenue is 6.3%.

The top 100 firms are facing competition from a range of new entrants. Some are offering technology directly to legal consumers. Some have created businesses based on a different model — different in terms of office use, people employed, and technology developed. They are almost certainly all spending significantly more than 4.1% of revenue on technology — some may surpass 10%.

The future of law will involve more technology. There is no doubt about that. Some artisan law firms will continue to exist, but the bulk of legal work will be done in businesses founded on technology platforms that go beyond word processing and email. Interestingly, many firms are working alongside the new entrants in the development of new ways of working. As Simon Wardley points out in a post describing the commoditisation of part of the entertainment media, doing so betrays a completely inadequate strategy.

Such a deliberate move by a commissioning company – the chess equivalent of Fool’s mate – should never work but it does, in industry after industry. Yes, I am saying that companies often support the commoditisation of an underlying component or constraint without realising this will reduce barriers of entry into their field and ultimately commoditise them. Companies seem to act thinking of the short term with no understanding of the impacts to themselves.

Most of the problem appears to be that companies cannot see the environment (i.e. they have no map) and aren’t used to any actual form of strategic play. To be honest, this is like stealing candy from a baby except the candy is worth millions or billions. What is really frightening, is it takes a couple of hours to map out and work out such a play. There is no way on earth you should be able to get away with this and I’m afraid it gets worse.

So, incumbent law firms should be investing more in technology, but they should also do so more strategically — armed with a really good understanding of the terrain they are fighting on. If they don’t, they become as useful as the water-trough pictured at the top of this post — fit only for decoration.

2014-10-09 19.11.51

A tale of two peelers: getting the tools right

Our household batterie de cuisine covers most normal eventualities, with plenty of pots, pans and utensils. We even have three corkscrews, which will be useful if there is ever a vinous emergency. One duplication is particularly interesting, and provides a metaphor for the knowledge and collaboration tools provided by law firms or other organisations.

2014-10-09 19.11.51We have two peelers.

I am sure this isn’t surprising in itself (after all, we have three corkscrews). However, the reason why we have two peelers is interesting. My wife and I have strongly-held and divergent views on the utility of each peeler. She hates the one I prefer, and I cannot use her favourite to peel effectively.

So we both use different tools to produce the same outcome — peeled vegetables. Such a clarity of outcome is not always possible in complex organisations, but I think it is worth striving for. Without it, one can easily be sidetracked into shiny new toys whose purpose is not really clear.

Having settled on a desired outcome, one needs to work out how best to achieve it. In our household there was no consensus on this. Fortunately, peelers are inexpensive enough to be able to acquire different types to satisfy everyone.

Even in more expensive situations, I think it is important to do everything possible to meet different needs when adopting new organisational tools and processes. When I look at some firms who have invested significant amounts in knowledge or collaboration tools that are rarely used, the cause is usually either a poorly defined outcome (what is this thing for, and does the average employee care about that?) or a failure to understand how people work and how that might be enhanced by the new system.

This was highlighted (again) by a tweet from today’s Enterprise 2.0 Summit in London:

‘Small pieces loosely joined’ was at the heart of many early uses of social tools within organisations. It is an approach that allows people to choose the approach that fits them and their desired outcome best. When the organisation chooses which outcomes to favour, and implements a one-size-fits-all tool, it is almost inevitable that half or more of the people who would have used it are put off by something that doesn’t work for them. As a result, it is much less likely that the desired outcome can actually be delivered.

It is still possible for organisations to find the right tools for people to use — big platforms are not the only approach. If you are interested in giving your people the peelers that they will use, I can help — please get in touch.

2014-08-14 13.52.20-2

Legal technology, practice, theory and justice

Like all other areas of life and work, the law has been changed immeasurably by technology. This will doubtless continue, but I am unconvinced by the most excited advocates of legal technology.

The impact of technology has been felt at a variety of levels. The last 35-40 years has changed the way practitioners approach all aspects of their work. Likewise, the changes wrought by technology on personal, social and commercial behaviour and activities have driven changes in the law itself.

Clouds round the tower of lawThese trends will doubtless continue, but predicting the actual changes that they will bring is a fool’s errand.

I recently wrote an article in Legal IT Today, arguing that the most extreme predictions of the capability of legal artificial intelligence would struggle to match the abductive reasoning inherent in creative legal work. In addition to that argument, I am less confident than some about the limits of technological development, I suspect that the economics of legal IT are not straightforward, and I have a deeper concern that there is little engagement between the legal IT community and generations of legal philosophy.

Limits of technology

One of the touchstones of any technology future-gazing (in any field, not just the law) is a reference to Moore’s Law. I am less certain than the futurologists that we should expect to see the doubling of capacity for ever more. If nothing else, exponential growth cannot continue for ever.

…in the real world, any simple model that shows a continuing increase will run into a real physical limit. And if it is an exponentially increasing curve that we are forecasting, that limit is going to come sooner rather than later.

What could stop computing power from increasing exponentially? A range of things — the size of the components on a chip may have a natural limit, or the materials that are used could start to become scarce.

More interestingly, from the perspective of legal business, the undoubted growth of technology over recent years has not necessarily produced efficiencies in the law, if we use lawyer busyness as a proxy for efficiency. There are far more people employed in the law now than 40 years ago, and they appear to work longer hours. Improved computing capability has produced all sorts of new problems that demand novel business practices to resolve them. (One of these being knowledge management.)

Nonetheless, it is still possible that future developments will actually be capable of taking on significant aspects of work that is currently done by people. The past is not necessarily a good predictor of the future.

The business challenge

There is currently a lot of interest in the possibility that IBM’s Watson will introduce a new era of legal expert systems. Earlier this month Paul Lippe and Daniel Martin Katz provided “10 predictions about how IBM’s Watson will impact the legal profession” in the ABA Journal. Bruce MacEwen has also asked “Watson, I Presume?” However, one thing that marks out any reference to Watson in the law is a complete absence of hard data.

The Watson team have helpfully provided a press release summarising the systems currently available or under development. Looking at these, a couple of things strike me. The most obvious is that there are none in the law. There are medical and veterinary applications, and some in retail and travel planning. There are applications that enhance existing IT capability (typically in the area of search and retrieval). But there are none in the law.  The generic applications could be certainly be used to enhance legal IT, but there is no indication of how effective they might be compared to existing tools. And, most crucially, it is unclear how costly Watson solutions might be. That is where legal IT often struggles.

The business economics of legal technology can be difficult. Medical and veterinary systems have a huge scale advantage — human or animal physiology changes little across the globe, and pharmaceutical effectiveness does not depend significantly on where drugs are administered. By contrast, legal and political systems differ hugely, so that ready-made legal technology often needs to be tailored to fit different jurisdictions. Law firms tend to be small compared to some other areas of professional services and the demands of ethical and professional rules often restrict sharing of information. Those constraints can mean that it is hard for all but the largest firms with considerable volumes of appropriate types of work to justify investment in the most highly-developed forms of technology. As a consequence, I suspect few legal IT providers will be tempted to pursue Watson or similar developments until they can be convinced that a market exists for them.

Technology, justice and legal theory

My Legal IT piece was a response to an article by David Halliwell. His piece started with a reference to an aspect of Ronald Dworkin’s legal philosophy. Mine was similarly rooted in theory. This marks them out from most of the articles I have read on the future of legal IT. Given the long history of association between legal theory and academic study of IT in the law (exemplified by Richard Susskind’s early work on the use of expert systems in the law), it is disappointing to see so little critical thought about the impact of technology in the law.

As I read them, most disquisitions on legal IT are based on simple legal positivism — the law is presented as a set of rules that can be manipulated in an almost mechanical way to produce a result. By contrast, there is a deeper critique of concepts like big data in wider social discourse. A good example is provided in an essay by Moritz Hardt, “How big data is unfair”:

I’d like to refute the claim that “machine learning is fair by default”. I don’t mean to suggest that machine learning is inevitably unfair, but rather that there are powerful forces that can render decision making that depends on learning algorithms unfair. Any claim of fair decision making that does not address the technical issues that I’m about to discuss should strike you as dubious.

Hardt focuses on machine learning, but his point is true of any algorithm and probably more generally of any technology tending towards artificial intelligence. Any data set, any process defined to be applied to that data, any apparently neutral ‘thinking’ system will have inherent prejudices. Those prejudices may be innocuous or trivial, but they may not be. Ignoring the possibility that they exist runs a risk of unfairness, as Hardt puts it. In the law, unfairness manifests itself as injustice.

What concerns me is that there doesn’t appear to be a lively debate about the risk of injustice in the way legal IT might develop in the future (not to mention the use of technology with a legal impact in other areas of society). Do we have a modern equivalent of the debate between Lon Fuller and H.L.A. Hart? I am not as close to legal theory as I used to be, so it may already have taken place. If not, are we happy for the legal positivists to win this one by default? (I am not sure that I am.)

2014-05-27 13.45.59

The limits of technology and law

2014-05-27 13.45.59One of the first law lectures I attended, over 30 years ago, was given by Avrom Sherr. As we all settled ourselves, full of our importance as future lawyers, Avrom walked into the lecture theatre and lay on his back on the desk at the front of the hall. The hubbub subsided and there was a moment of uncertainty (embarrassment even) before he got to his feet to start the lecture.

The point of this act of theatre, we were informed, was as follows.

In previous centuries, medical students were taught from cadavers. As a consequence, everything they learned was pathology. More recently, medical science had caught up with the idea that most people were actually healthy and that there was probably more to be understood about the workings of healthy bodies than diseased and dead ones; certainly as much that would be useful to those charged with the care of the living.

Legal studies, Avrom argued, had a similar problem. By studying the pathology of the law (as found in centuries of case law), the real life of the law was lost. His impersonation of a cadaver was intended to remind us that although dissection of cases (like anatomy lessons) had a purpose in learning about law, we should not forget that the vast majority of legal actions (making contracts, administrative decision-making, etc) would never be even be the subject of litigation, let alone a reported case.

I was reminded of this experience, and the valuable lesson, by a short article in The Lawyer by Peter Kalis (chairman and global managing partner, K&L Gates), “Lawyers as robotic bores? It’s not the English way”. Mr Kalis will be writing a series of articles, and this one sets out his stall.

In future columns I’ll supply some thoughts on our evolving industry. In this inaugural venture, however, I wish to acknowledge my debt to the English legal tradition. In other words, I come in peace.

He singles out three legal academics whose work influenced him whilst at Oxford 40 years ago: HLA Hart, Sir Otto Kahn-Freund, and Mark Freedland.

Why do Professors Hart, Kahn-Freund and Freedland matter here? Their careers nicely illustrate that law is about ideas and the ability to express them, whether in service to clients or to scholarship.

In future columns you’ll see me challenge those who regard lawyers and their firms as anachronistic and those who would reduce us to automata and algorithms. It will be my way of saying thanks to Professors Hart, Kahn-Freund and Freedland, among so many others on your side of the pond.

That description of the purpose of law — “ideas and the ability to express them” — resonates with my experience as a raw undergraduate. After four years of study at Warwick, it was clearer than than ever to me that law doesn’t exist to give opportunities to judges and law reporters. As an academic discipline it can be a kind of applied social science — a combination of psychology, ethnology, economics, politics — that may help to describe how social and individual relationships might work out in the presence or absence of power. Unlike many of those other disciplines, law also has a practical life outside the academy. Its practitioners have the privilege of being able to help mediate in those relationships — supporting or opposing power as necessary.

Over the past few years, I have kept coming back to this point about relationships in my work and on this blog. I am more sure than ever that good law, sensitively practised, depends on an understanding of the people involved. That understanding requires the kind of insight into human relationships, desires and needs, power structures, that I suspect most people develop unconsciously.

Critically, though, technology struggles with this aspect of law as lived. It sometimes appears that the most vocal technology advocates forget this. As news this week about the Turing test shows, it is too easy to be blinded by overblown claims of what computers can do. The reality is usually much more limited. In this context, also, we need to know whether a piece of legal technology deals with a pathological legal problem or the real human issue that underlies the call to law. If it doesn’t look to the latter, then it will be of severely limited use. That is not to say it will be useless, just good for some things only.


Hiding behind technology: what kind of a job is that?

I think our relationship with technology is detracting from our capacity to work effectively. In order to change this, we need to reassert what it is that we actually do when we come to work.

One of the staples of TV drama is the workplace, another is espionage. The BBC is currently showing a short series, The Hour, in which those elements are combined with a touch of social/political comment in a not-so-distant historical setting — a BBC current affairs programme (The Hour of the title) in 1956, as Hungary is invaded by the Soviet Union and Egypt precipitates the Suez crisis. It isn’t the best thing that the BBC have done — Mad Men beats it for verisimilitude, nothing can touch Tinker, Tailor, Soldier, Spy for British cold war espionage drama, and at least one person who was in TV in the 1950s is adamant that its representation of news broadcasting is a long way from the reality. That said, it is relaxing Summer viewing.

One of the things that struck me, watching the most recent episode, is that everyone is intimately engaged with the objects of their work. Cameramen wield cameras; editors cut film; reporters write words (with a pen or pencil) on paper. And they do one thing at once. During the episode, the producer of The Hour is admonished by her superior (for having an affair with the programme’s presenter). As she enters the room, he is making notes in a file. He closes it while berating her for putting the programme, and her career, at risk. When finished, he returns to his paperwork. There is no doubt at any point during this sequence as to his focus, his priorities or his wider role.

I think we have lost that clarity. As I look around me, in all sorts of workplaces, there is little or no distinction in the environments inhabited by people who actually do very varied jobs. Generally, it looks like we all work with computers. People sit with a large flat surface in front of them, which is dominated by a box filled with electronics, umbilically attached via (in my case) ten cables to a variety of other bits of electronics, to power and to a wider network. One or two of those other pieces of hardware are really intrusive. The screens we work at (I have two) are our windows into the material that we produce — documents, emails, spreadsheets — to the information we consume, and to our connections with other people. But physically, they fail miserably to benefit our human connectivity. In my case, the screens sit between me and the rest of the occupants of my working room. We all sit in a group, facing each other, but our screens act as a barrier between our working environments. When we converse, we have to crane round the barriers, and we are easily distracted from the conversation by things that happen on the screens.

But if you asked the average law firm employee (whether a lawyer or not) what they do every day, very few would respond that they work with computers. They would speak in terms of managing teams, delivering quality advice to clients, supporting the wider business with training, information or know-how. Some of our IT colleagues might agree that they do work with computers, but some would claim instead that their role is to enhance the firm’s effectiveness and that computers are just the tools by which that is achieved. That is consistent with research conducted by Andrew McAfee, for example. At an organisational level, then, technology improves performance. However, it is also well-observed that many forms of technology, inappropriately used, can distract people and reduce their personal effectiveness. That is manifest in complaints about information overload, email management, social media at work, and so on.

The problem is that, through this box and its two big screens, I have access to absolutely everything I need — the software tools, the online information, the worldwide contacts — to do my job. Unfortunately, because everything is in the same place, it is hard to create clear boundaries between all these things. Outlook is open, so I see when email arrives even though I am working on a document. When I am focusing on an email on one project, it is sitting next to one on a different topic, so it is practically impossible not to skip to that topic before I am actually ready. We can discipline ourselves, but that actually makes work harder, and so we must be less effective.

In some organisations, the technology is configured to provide access just to the tools people need. This is typically the case in call centre environments, for example. I think this only really works when people are working through clearly defined processes. As soon as a degree of creativity is required, or where the information needs of a role are emergent, bounded technology starts to fail.

Instead, I think each of us needs to understand exactly what we need from the technology, to create a clear path to that, and to take steps to exclude the less relevant stuff.

My current role requires me to take responsibility for a group of people who have not previously thought of themselves as a single team. I shouldn’t do that from a desk which is at a significant distance from many of them. The technology may fool me into thinking that I am bridging that distance by sending emails and writing documents, but I am sure that isn’t really the case. We have technology to allow me to divest myself of the big box and its screens. I am seriously considering doing just that — doing my job, rather than working with computers.


The nature of the firm, and why it matters

Jordan Furlong‘s justified question, “Why do law firms exist?” is something that isn’t just relevant to partners (or potential investors in firms). Those who support the core functions of the firm need to be aware of its implications. I’ll come back to Jordan’s question, but first I want to reflect on something else.

Thanks to the generosity of Headshift, I was able to attend the Dachis Group’s London Social Business Summit at the end of March. One of the most interesting sessions that day was the presentation by Dave Gray of XPLANE. Dave outlined his current thinking about the nature of the company, which can be found summarised in the initial post on his new site, The Connected Company.

Dave is concerned about the short life span of the average company:

In a recent talk, John Hagel pointed out that the average life expectancy of a company in the S&P 500 has dropped precipitously, from 75 years (in 1937) to 15 years in a more recent study. Why is the life expectancy of a company so low? And why is it dropping?

He is also worried about their productivity:

A recent analysis in the CYBEA Journal looked at profit-per-employee at 475 of the S&P 500, and the results were astounding: As you triple the number of employees, their productivity drops by half (Chart here).

This “3/2 law” of employee productivity, along with the death rate for large companies, is pretty scary stuff. Surely we can do better?

I believe we can. The secret, I think, lies in understanding the nature of large, complex systems, and letting go of some of our traditional notions of how companies function.

The largest complex system that still seems to work is the city.

Cities aren’t just complex and difficult to control. They are also more productive than their corporate counterparts. In fact, the rules governing city productivity stand in stark contrast to the ominous “3/2 rule” that applies to companies. As companies add people, productivity shrinks. But as cities add people, productivity actually grows.

A study by the Federal Reserve Bank of Philadelphia found that as the working population in a given area doubles, productivity (measured in this case by the rate of invention) goes up by 20%. This finding is borne out by study after study. If you’re interested in going deeper, take a look at this recent New York Times article: A Physicist Solves the City.

Drawing on a study of long-lived successful companies commissioned by Shell Oil, Dave spots three characteristics of those companies also shared by cities:

Ecosystems: Long-lived companies were decentralized. They tolerated “eccentric activities at the margins.” They were very active in partnerships and joint ventures. The boundaries of the company were less clearly delineated, and local groups had more autonomy over their decisions, than you would expect in the typical global corporation.

Strong identity: Although the organization was loosely controlled, long-lived companies were connected by a strong, shared culture. Everyone in the company understood the company’s values. These companies tended to promote from within in order to keep that culture strong. Cities also share this common identity: think of the difference between a New Yorker and a Los Angelino, or a Parisian, for example.

Active listening: Long-lived companies had their eyes and ears focused on the world around them and were constantly seeking opportunities. Because of their decentralized nature and strong shared culture, it was easier for them to spot opportunities in the changing world and act, proactively and decisively, to capitalize on them.

The whole post is worth reading and reflecting on. Dave’s prescription for success, for companies to be more like cities, is to shun divisional structures, and to build on networks and connections instead. This has been refined in a more recent post into a ‘podular’ system.

A pod is a small, autonomous unit that is enabled and empowered to deliver the things that customers value.

By value, I mean anything that’s a part of a service that delivers value, even though the customer may not see it. For example, in a construction firm, the activities valued by customers are those that are directly related to building. The accounting department of a construction firm is not part of the value delivery system, it’s a support team. But in an accounting firm, any activity related to accounting is part of the customer value delivery system.

There’s a reason that pods need to focus on value-creating activities rather than support activities. Support activities might need to be organized differently.

This idea appears to be closely related to Steve Denning’s notion of Radical Management, as described in his latest book. It also reflects the way that some professional service firms organise themselves. That’s what brings us back to Jordan Furlong’s question.

Why do law firms exist? Or, more properly, why should law firms continue to exist? (One important reason why they exist is that their history brought us to this point. What might happen to them in the future is actually more interesting.)

Jordan’s post starts with Ronald Coase, but also points to a number of ways in which law firms might not meet Coase’s standards.

Companies exist, therefore, because they:

  • reduce transaction costs,
  • build valuable culture,
  • organize production,
  • assemble collective knowledge, and
  • spur innovation.

So now let’s take a look at law firms. I don’t think it would be too huge a liberty to state that as a general rule, law firms:

  • develop relatively weak and fragmented cultures,
  • manage production and process indifferently,
  • assign and perform work inefficiently,
  • share knowledge haphazardly and grudgingly, and
  • display almost no interest in innovation.

That’s an inventory of defects that would make Ronald Coase wonder exactly what it is that keeps law firms together as commercial entities.

Worse than that, Jordan points to a range of recent commentaries suggesting that things aren’t getting any better. I think he is correct. In fact, it is interesting to note that John Roberts spotted the germ of the problem in his 2004 book, The Modern Firm.

Many authors, including Ronald Coase and Herbert Simon, have identified the essential nature of the firm as the reliance on heirarchic, authority relations to replace the inherent equality among participants that markes market dealings. When you join a firm, you accept the right of the executives and their delegates to direct your behaviour, at least over a more-or-less commonly understood range of activities. …

Others … have challenged this view. They argue that any appearance of authority in the firm is illusory. For them, the relationship between employer and employee is completely parallel to that between customer and butcher. In each case, the buyer (of labor services or meat) can tell the seller what is wanted on a particular day, and the seller can acquiesce and be paid, or refuse and be fired. For these scholars, the firm is simply “a nexus of contracts” — a particularly dense collection of the sort of arrangements that characterise markets.

While there are several objections to this argument, we focus on one. It is that, when a customer “fires” a butcher, the butcher keeps the inventory, tools, shop, and other customers she had previously. When an employee leaves a firm, in contrast, she is typically denied access to the firm’s resources. The employee cannot conduct business using the firm’s name; she cannot use its machinery or patents; and she probably has limited access to the people and networks in the firm, certainly for commercial purposes and perhaps even socially. (The Modern Firm, pp.103-4)

The benefits Roberts identifies are almost always missing in a law firm. The firm’s name may be less significant than the lawyer’s and there is little machinery or patents. In the seven years since the book was published access to networks and people has become infinitely more straightforward, thanks to developments in social software and similar technologies.

Joining Roberts’s insights with those of Dave Gray and Jordan Furlong, I think it is likely that we will see much more fluid structures in law firms in coming years. Dave Gray’s podular arrangement need not be restricted to one organisation — what is to stop clients creating their own pods for specific projects, drawing together the good lawyers from a variety of firms? Could the panel arrangement now commonly in use by larger companies be a Trojan horse to allow them to pick off key lawyers whenever they need them? Technology is only going to make that easier.

So that leaves the support functions. In Dave Gray’s podular model, support is provided by a backbone, or platform.

Podular platform

For a podular system to work, cultural and technical standards are imperative. This means that a pod’s autonomy does not extend to choices in shared standards and protocols. This kind of system needs a strong platform that clearly articulates those standards and provides a mechanism for evolving them when necessary.

For small and large companies alike, the most advantageous standards are those that are most widely adopted, because those standards will allow you to plug in more easily to the big wide world – and the big wide world always offers more functionality, better and more cheaply than you can build it yourself. Platform architecture is about coordination and consistency, so the best way to organize it may not be podular. When it comes to language, protocols, culture and values, you don’t want variability, you want consistency. Shared values is one of the best ways to ensure consistent behavior when you lack a formal hierarchy. Consistency in standards is an absolute requirement if you want to enable autonomous units.

Interestingly, there is often little variation between different law firms in terms of their technical standards. In some practice areas, these are dictated by external agencies (courts, industry associations, etc.), whilst in others they converge because of intervention by common suppliers (in the UK, many firms use know-how and precedents provided by PLC) or simply the fact that in order to do their job lawyers have to share their basic knowledge (first-draft documents often effectively disclose a firm’s precedents to their competitors). It is a small step to a more generally accepted foundation for legal work.

Will clients push for this? Would they benefit from some form of crowd-sourced backbone to support lawyers working for them in a podular fashion? Time will tell, but don’t wait for the train to leave the station before you decide to board it.