Legal analysis: customer service data technology and analysis

Data-driven organizations are 23 times more likely to capture customers.

As a lawyer and critical observer of the sector, I cannot fail to mention how undeniable the evidence is with regard to the transformation that industry is undergoing. We live in a constantly changing world, where technology and data analysis are becoming increasingly important. In this paradigm shift, the legal sector is and should not be foreign.

The pressure that firms face for being competitive, highlighting, controlling their costs, attracting talent and acquiring customers in an organic and constant way is not a great novelty, but —Certainly.— I believe that this pressure has become more evident today. The management teams of law firms are dealing with challenges that are also framed in an uncertain macroeconomic context and volatile demand.

On the other hand, the recent technological development experienced with the Generative artificial intelligence It seems to be disconcerting many with regard to their digital strategy and what was believed to be a controlled and slow process within the legal industry.

The abundance of content and the overwhelming pressure to adopt these technologies should not surprise anyone. This is a moment that, like, Bill Gates He said on his blog a few months ago, it is historic for society and the way we perceive the technologies in our profession.

It is important to note that the use of technology in Latin law firms is at an early stage of maturity. However, improvements in certain technologies could accelerate this process. At present, most of the technology tools used are focused on administrative and financial management, as well as the monitoring of judicial matters within the offices. However, few firms have begun to explore more advanced technologies, such as knowledge management and databases or customer relationship solutions.

Legal analysis

However, it is precisely in these more advanced technologies that great opportunities can arise. Clio, a legal technology company, defined the legal analysis such as the process of incorporating data into decision-making on issues affecting the offices of individual lawyers and lawyers, such as case forecasting, legal strategy and resource management.

When used properly, legal analysis provides a competitive advantage by providing unprecedented transparency and introspection over lawyers' members, departments and decisions.

However, for the analysis to exist, it is necessary to capture data, convert data into information and transform that information into knowledge.

Almost 2 years ago, Mark Cohen wrote in Forbes about the importance of data analysis in legal practice, highlighting how monitoring the right key performance indicators can have a significant impact on the firm's income and growth.

KPI related to the acquisition of customers, such as the cost of acquiring a new client, the number of new prospects per source and the estimated average value of each new case, can provide valuable information to optimize growth strategies.

A note published by Hannah Bruno in LawPay a few months ago mentioned that legal analysis can help lawyers identify patterns and predict results in similar cases, which can be used to develop more effective litigation strategies.

Similarly, when analysing the performance data and past customer results, firms can better understand their needs and preferences, which can result in more personalized services and communications that increase customer satisfaction and loyalty.

It is precisely in this latter aspect that data and their analysis can have a relevant impact on the relationships we have built with customers.

If we are able to interpret and design better service experiences, we will also be able to highlight and be referred to by those who experience those exceptional experiences.

This will allow us to forge a differentiated seal that will allow the firm to maintain its relationships and increase its return.

Mark Cohen, in his Forbes article, cited a McKinsey study that shows the positive impact that data can have on an organization. The data-driven organizations are 23 times more likely to acquire customers, 6 times more likely to retain customers and 19 times more likely to be profitable as a result.

Although there are few published experiences on the use of data and technology for the service of the customer in the legal sector, this will certainly be the way forward. The potential benefits are enormous, but there are also challenges.

One of the most common obstacles is the resistance to input data and information into available systems. Lawyers, often under pressure over time and focused on maximizing their profitability, do not immediately perceive the value of investing time in data management, measurement and use.

As Mark Cohen points out, the inability of the legal sector to take advantage of the power of data analysis is one of several factors that are widening the digital divide that separates it from the business world. This affects not only the performance of the legal function but also the company as a whole and its customers.

It is vital to overcome this cultural barrier in the legal world. While historically based on personal relationships, we cannot ignore that the basis of an innovative value proposal lies in the use of data and its interpretation.

The future of legal signatures depends, to a large extent, on their ability to understand their customers and the context in which their businesses operate.

Capturing, processing, understanding and using relevant information is essential for developing competitive advantages. Data analysis, even in its early stages in the legal industry, will become a key tool in this task.

Therefore, the message for all legal signatures is clear: it is time to embrace the technology and data analysis. Resistance to this change will only delay the inevitable and reduce our chances of success in an increasingly digital future. The future of legal signatures is technological and data-oriented and that future is already here.

The invitation is open: do you want to join this transformation?

*Andrés Jara Baader is the founder of Alster Legal, one of the first Alternative Legal Service Providers (ALSP) in Latin America. He is also co-founder and CEO of Kea Technology Inc., a company focused on building work spaces for digital lawyers (ajara@alsterlegal.com).