Over the past five years, I have had the privilege of serving as a legal manager for clients across diverse industries, providing me with a unique perspective on the evolution of legal technology and the broader digital transformation within the legal sector. While it is true that the legal profession tends to be a late adopter of new technologies due to its inherent conservatism, I see a significant and positive shift in recent years.
Adoption of Legal Project Management
Legal Project Management (LPM) is gaining traction as law firms and bigger corporations with legal departments in CEE seek to improve the delivery of legal services. LPM involves the application of project management principles to legal cases, ensuring that projects are completed on time, within budget, and to the satisfaction of clients (including internal ones).
Outsourcing Routine Legal Tasks and Nearshoring to CEE
Legal Process Outsourcing (LPO) is becoming a common practice in CEE. Routine legal tasks such as document review, legal research, and compliance monitoring are being outsourced to specialized service providers. This helps firms reduce costs, improve efficiency, and focus on high-value tasks.
The CEE region itself is emerging as a hub for nearshoring legal services. Western European and North American law firms are increasingly outsourcing legal work to CEE countries due to their skilled workforce, cost advantages, and geographical proximity. This trend is driving growth in the legal services market and fostering the development of specialized LPO firms in the region. It is not uncommon for European headquarters to utilize, for instance, a Czech law firm to streamline and distribute their legal requests across various countries in Europe.
Focus on Client-Centric Services
Law firms are increasingly adopting client-centric approaches, emphasizing the importance of understanding client needs and providing tailored solutions. This shift is driven by the competitive legal market and the demand for high-quality, responsive legal services. Firms are leveraging technology to enhance client communication, offer real-time updates, and deliver value-added services. This approach goes hand in hand with LPM and LPO.
Remote Work Technologies, AI, and Document Automation
The COVID-19 pandemic has accelerated the adoption of remote work technologies within the legal sector. Law firms in CEE have embraced video conferencing, cloud-based document management systems, and collaborative tools to facilitate seamless remote work. This transition also led to the emergence of virtual law firms operating exclusively online, offering flexible and cost-effective legal services. I wonder if clients will eventually shift to using legal services online, much like they have transitioned to buying clothes, groceries, or even cars online. This change could potentially challenge current giants in the legal market by significantly reducing costs.
AI and machine learning technologies are being increasingly integrated into legal practice. Legal tech startups in CEE are developing AI-driven tools for contract analysis, legal research, and predictive analytics that help law firms and corporate legal departments automate routine tasks and make data-driven decisions. These technologies significantly enhance efficiency, accuracy, and cost-effectiveness. AI tools streamline contract review, expedite data mining, and predict litigation outcomes, enabling data-driven decision-making but challenges like data privacy, security, and integration with existing systems need careful management.
Document automation tools are changing the drafting and management of legal documents. By automating repetitive and time-consuming tasks, these tools enable lawyers to focus on more complex and strategic aspects of their work. This trend is particularly noticeable in transactional law, where standardized documents can be generated quickly and accurately. It is encouraging that law firms are embracing this trend, actively investing in this area, and developing or supporting such legal platforms and solutions.
GDPR and Cybersecurity
In the aftermath of the General Data Protection Regulation (GDPR), data protection has emerged as a paramount concern among legal professionals throughout CEE. Law firms and enterprises are committing substantial resources to implement strict cybersecurity measures, ensuring GDPR compliance and safeguarding confidential client data. This proactive strategy includes adopting state-of-the-art encryption technologies, secure communication channels, and conducting regular audits of data protection practices. On the other hand, the GDPR and the stringent data protection legislation in CEE are currently hindering the rapid integration of new technologies and posing significant challenges for technology startups aiming to penetrate the market.
Cyber-attacks are a persistent threat annually impacting businesses. It is no wonder that companies invest significant resources in training their personnel and carefully selecting vendors who meet high cybersecurity standards. I personally appreciate the growing collaboration between legal departments and IT within corporations to establish robust policies aimed at preventing cyber-attacks as a positive outcome. Such close cooperation is increasingly essential across various business areas within corporations.
Conclusion
The legal technological and management trends in CEE are driving significant improvements in the delivery and management of legal services. The adoption of digital technologies, the rise of legal tech startups, the emphasis on cybersecurity, and the implementation of modern management practices are reshaping the legal landscape. These trends are enhancing efficiency, reducing costs, and improving access to government, positioning CEE as a dynamic and innovative legal market. As these trends continue to evolve, they will undoubtedly play a crucial role in the ongoing transformation of the legal sector in CEE.
This article was originally published in Issue 11.7 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.
