The business world has deep roots in technical innovation – a rich tradition that now translates into blockchain adoption and the implementation of smart contracts. From a legal operations perspective, success is supported by adopting legal tech in a company. Corporate legal counsels are able to perform at great speeds. They are able to pay close attention to a great many details.
Nevertheless, companies require a significant change to their legal operations. Or to put it differently – the right cost of legal tech is crucial to improving operations. As legal teams become overwhelmed, stressed and understaffed, automating outdated manual processes for contract drafting and contract management is the first step.
Over the past 10 years, the advancements in technology has dramatically changed the face of the legal sector. Law firms have already begun to feel the impact of these disruptions. And corporate legal departments are increasingly being asked to reduce costs and operate more efficiently than ever before. Legal is also seeing the wall come down between its function and the business.
As more processes within the legal department lend themselves to automation, we expect artificial intelligence to be part of the next wave of transformation and disruption. For example, the use of technologies to solve legal problems may become increasingly routine.
However, this comes with a hefty price tag. According to data published by Gartner – By 2025, legal departments will increase their spend on technology threefold. 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.
Increasing the productivity and efficiency of legal teams
So how do you increase productivity and efficiency for your legal teams via smart contracts?
Adopting legal tech in a company can alleviate and overcome the challenges of manual processes that are time consuming and inefficient. Smart contracts offer the next level of automation after CLM software.
Companies are still discovering the full extent of the disruptive potential of smart contracts. Automating processes and the shift of responsibilities to other business units enables legal to handle more complex matters because now they have more time to dedicate to what is really important. Organizations and firms need to assess the benefits and value of legal tech over manual processes.
Smart contracts facilitate the management of legal processes across multiple locations, around the world. They help teams search for important metadata, including key phrases or clauses. What is more, they can be integrated with existing CLM software to streamline business operations.
Smart contracts let you:
- Access contracts from anywhere, because they are not physical
- Search quickly for metadata, including key phrases or clauses
- Integrate your smart contracts with existing CLM software to streamline business operations
- Store securely – if you choose the right provider – all your (smart) contracts
- Save time and money for compliance checks
Why the right cost of legal tech matters
Investing in the right cost of legal tech means that you can expand its legal capabilities beyond what stakeholders and vendors imagined. After the initial setup of the smart contract-based solution – and the education and training surrounding it – the company’s contract management process becomes more efficient and effective.
Automating via smart contracts allows you to assemble, automate, approve, sign, and manage thousands of contracts. Essentially, the company can bring everybody who interacts with the system together in one ecosystem. This is quite different from having disaggregated engagements, in which the CLM system is merely rolled out and users are invited to training sessions over email.
We view smart contract adoption as a strategy where a company can take a step-by-step approach to legal tech adoption.
So what are the other steps?
Well, mainly it is important that no team member is left behind. While developing a “culture of change management,” you should constantly seek out and receive feedback on what is working well and what is working poorly.
Remember that legal tech adoption is as much about shifting the organizational mindset as it is introducing new systems and ways of working. Your people, after all, are important in ensuring that technological innovations like smart contract solutions firmly take root.
When this is done well with the right cost of legal tech, legal digital transformation can make all of the difference for organizations. And if you happen to be working on your own smart contract deployment, it helps to work with a solid, award-winning partner – like Trakti – that values innovation as much and as deeply as you do.
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