There is another significant factor that adds to the aversion of technology adoption for lawyers. While many firms are exploring fixed fee and unbundled legal service models, the billable hour continues to be the most prominent revenue model for lawyers. Under this model there is little motivation to spend â€˜unpaidâ€™ time innovating, learning new technologies, or implementing tools that create lawyering efficiency.
â€œSeveral years ago a partner in a firm I worked for asked me to â€œautomateâ€ a lease he used for a large client who owned high-rise office buildings. The lease template was about 65 pages. It took me only a few hours to create an automated template. Using the template, it would take him only about 15 minutes to generate a first draft of the lease for new prospective tenants, whereas it typically took him about three or four hours of billable time to generate the lease manually. As I presented this automated template to the partner, he was very pleased with the results at first. Several minutes into my presentation, however, he asked the question that doomed the project: â€œHow will I make any money from this?â€
â€œThe partner earned thousands of dollars in revenue based on the time it took to create the initial draft of the lease. He also earned revenue on the subsequent hours spent negotiating the final draft. With the automated solution, though, it would take only about 15 minutes or less to create the first draft. So based on a billable-hour model, his revenue expectations for this client would be cut nearly in half. I suggested that he consider changing his revenue model to charge a fixed fee for the creation of the lease and charge by the hour for any negotiation and modifications to that lease. He didnâ€™t feel that the law firm would support this revenue model and decided not to implement the automated solution.â€
Janis, B. (2014, May/June). How technology is changing the practice of law. GPSOLO, 31(3). Retrieved from:http://www.americanbar.org/publications/gp_solo/2014/may_june/how_technology_changing_practice_law.html
Unit 3 Discussion Topic: Bloated Billing
The article above illustrates an issue with technology and efficiency in general. If things take less time to produce, lawyers that charge hourly may not get paid as much to produce them. Do you think this leads to a reluctance to embrace technology in the legal field? Do you think it is acceptable for lawyers to operate without new technology? Should lawyers be forced to continually update or learn new technology in order to be more efficient? How should lawyers protect their income and still operate efficiently? Discuss the tension between technology and billing. Cite some sources that support your points.