The Evolution of Legal Tech at Hengeler Müller: Embracing Legal Tech 2.0

The speaker expresses gratitude for the opportunity to present and aims to quickly cover the usual slides to engage in critical discussions. They introduce the concept of 'Legal Tech 2.0' and mention the importance of understanding the transformation process at Hengeler Müller.

The Legal Tech Center at Hengeler Müller is structured to manage five key areas: tools and services, IT procurement, innovation projects, digital education, and external outreach. The center focuses on ensuring that legal tools are uniformly integrated across practice groups, with associates rotating every eight months to enhance their familiarity with various applications.

The Legal Tech Center oversees the procurement of IT and Legal Tech resources, including hardware, software, and outsourcing. It also develops rules and guidelines for IT compliance to ensure smooth operations within the firm.

The center manages innovation initiatives, such as the collaboration with Slot.MA for Legal Tech in Cuba, which is currently in its third round. Additionally, it runs an internal program called Kampai, allowing associates and staff to propose new ideas.

The Legal Tech Center emphasizes digital education, aiming to raise awareness about digitalization and Legal Tech. This includes organizing coding schools, discussions on cloud compliance, and educating staff on current trends and tools like Contract Lifecycle Management (CLM) and Content Management Systems (CMS).

The center monitors emerging trends in the legal market and advises the partnership on necessary adjustments. It also shares its experiences and knowledge regarding Legal Tech and IT services with external parties, acting as a gateway for consulting on digital transformation.

The Legal Tech Center is viewed as a strategic hub for implementing digital transformation from start to finish, covering all aspects from vendor selection to engagement letter adjustments. The primary focus is on transforming legal work processes, with a team of approximately 20 members from various practice groups and business services.

The speaker reflects on the early days of Legal Tech, representing Engelberg Müller and likely many other law firms. Initially, a variety of tools were experimented with, leading to a landscape filled with isolated solutions that addressed specific problems but lacked integration. These tools functioned well in isolation but fell short when trying to build upon them, often reverting back to traditional methods like Word. Over time, attempts were made to create connectors and import-export functions, but the tools remained largely independent, limiting their overall impact on legal mandates.

Legal Tech 1.0 was characterized by its use primarily in high-profile mandates where resources were available, and specific challenges needed addressing. Tasks such as rapid document creation or extensive clause searches were beyond human capability, leading to significant enthusiasm when tools successfully accomplished these tasks. However, the integration of these tools did not alter the team's workflow or mandate processes, as the reliance on tool experts meant that traditional methods continued without necessitating real change management.

The proliferation of tools led to a situation where each problem had a corresponding tool, resulting in an increase in the number of tools available. This growth created a perception that the number of tools equated to the diversity of Legal Tech within a firm. However, this also had a darker side, as firms became overly dependent on power users who understood the tools. Quick shifts to new tools often resulted in lost productivity and raised concerns about compliance, data retention policies, and the necessity of client consent, highlighting inefficiencies in the approach.

The speaker advocates for a transition towards a more integrated world where isolated tools work harmoniously together. Using procurement as an example, the speaker outlines a streamlined process that begins with creating a task, analyzing contracts, making tiered decisions, and automating document creation. This process can leverage various applications, including SharePoint and AI, to enhance efficiency. The ideal scenario involves seamless document management and compliance checks, ultimately leading to faster and more effective operations within legal frameworks.

The discussion emphasizes the need to revolutionize not just IT architecture but the entire architecture of a law firm or business. This involves integrating software, hardware, compliance guidelines, and management processes into a cohesive system. The speaker highlights that while Legal Tech 1.0 focused primarily on software, a more holistic approach is necessary, where processes are adaptable and can be shaped by software capabilities. The ultimate goal is to create a seamless orchestration of all elements involved in legal practice, ensuring that processes are efficient, reliable, and compliant.

The speaker outlines the impact of this transformation on the service landscape at Hengel und Müller. They have streamlined their tools and services, focusing on creating integrated service lines that enhance client work rather than isolating them as standalone products. One significant development is HM Connect, a platform that integrates various systems, including GMS and SQL databases, to facilitate project management and collaboration. This platform serves as a central hub for all legal tech services, both internally and in client interactions.

In addition to HM Connect, the firm has introduced HM AI Review Services, which enhance due diligence and e-discovery processes. This service allows for the seamless transfer of information into HM Connect, enabling users to manage data efficiently. The integration of these services creates a unified experience for users, who perceive only one platform despite the underlying complexity.

The firm has also implemented Automated Drafting Services, which utilize text automation to create documents. However, the speaker notes that this service is not widely used due to the unique nature of legal documents at Hengel und Müller, where standard templates are rarely applicable. Instead, the focus is on the customization of contracts, indicating that while text automation offers some benefits, its overall impact has been limited in this context.

The system excels in mass procedures within the litigation sector, particularly in creating corporate documents for numerous similarly structured subsidiaries. While there is significant value in this area, the expansion of template services has not proven to be particularly beneficial.

Connect and AI Review Services have been enthusiastically adopted, demonstrating strong integration capabilities. The success of these services may depend on the individual mandate settings, indicating a tailored approach to client needs.

Translation services incorporate both translation software and human translation services, providing a comprehensive offering for translations. Each of the four services includes integrated routing to determine the best tool or mode of support for the user, who remains largely unaware of this process.

The ongoing integration with Office 365 aims to eliminate parallel workflows, ensuring that documents are returned to their original sources. This integration is complex and requires significant effort, including adjustments to contracts and the design of processes that leverage the capabilities of the tools.

The era of Legal Tech 1.0, characterized by a plethora of individual tools, is considered inefficient as it often results in custom solutions for replicable products. The focus has shifted towards leveraging Legal Tech and IT systems for genuine transformation within organizations.

A significant challenge lies not only in the technological aspect but also in transforming human work processes. The speaker emphasizes the importance of understanding that software, hardware, processes, and best practices form a cohesive unit that can be shaped to meet new challenges in Legal Tech.

The organization is undergoing a substantial digital transformation that extends beyond Legal Tech, impacting the foundational IT architecture. This transformation introduces new challenges, particularly regarding cloud services and the need for heightened employee awareness in handling client mandates.

The discussion highlights that Legal Tech tools alone are insufficient; the emphasis is now on transformation, bringing Legal Tech closer to client work rather than relegating it to back-office functions. The speaker expresses hope for continued engagement and discussion on these evolving topics.