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Global law firms are supposedly leading the way with technology and innovation offerings. But are they offering anything you wouldn't find in a local operation? 

In a recent study, UUÂãÁÄÖ±²¥ spoke to some of the world's biggest international law firms about the technology, talent, and services they offer and how they compare with the broader legal market.

Dana Denis-Smith, CEO of legal outsourcing provider Obelisk Support, says many traditional law firms are lagging when it comes to technology investment. In her view, most alternative legal service providers (ALSPs) are better placed to enable in-house teams to complete more work and cut costs.

Yet even a quick look at the technology on offer at the top law firms will confirm they're in a league of their own. Many of the firms we spoke with were early adopters of legal technology. 

The technology global law firms are using

Alongside investing in sturdy internal infrastructures, many have developed tech-as-a-service offerings that enable clients to access tools and products to deliver legal services faster and more cost-effectively. For example, CMS's Innovation and Legal Operations team uses data science and machine learning to provide clients with a more cost-effective service.

Greg Baker, global head of practice innovation at magic circle law firm, Linklaters, says, "We provide our lawyers with a modern workbench of tools and services to enable them to draft a document, deliver some advice or negotiate with a counter-party, in an efficient way," pointing out that the firm was one of the earliest users of document automation almost 20 years ago.

The firm's team of 2,500+ lawyers spread across 30 offices and 20 countries have access to document automation tools such as automated proofreading tools, AI-powered review tools to search across sets of documents, and project management tools to deliver a smooth service on time, says Baker.

According to  of the top 100 law firms in the UK, the three most significant priority areas for legal technology investment are 'Document Management Systems', 'Matter Management' and 'Collaboration tools'. A report by LawtechUK found that regulatory compliance and legal document management attracted the most cash, estimating overall productivity gains worth up to £1.7bn annually for legal service providers.

The UK's increasing interest in legal technology is often attributed to the introduction of the Legal Services Act 2007, which enabled non-lawyers to own and operate legal services firms. Some argue that US law firms have yet to follow the same trajectory.

According to Frances Murphy, partner and managing partner of Morgan Lewis's London office, Morgan Lewis was the first firm to launch an eData team and start working with alternative fee arrangements over 20 years ago.

The changing needs of clients

The make-up of in-house legal departments is evolving – and so too are their relationships with external counsel.

When we asked in-house lawyers specifically how their teams will grow, just under half (46%) of the respondents said they believe in-house roles will become more specialised. A third (33%) said they think in-house teams will rely more on flexible resourcing for specialist expertise.

In-house lawyers are under mounting pressure to do more with less – and their rising workloads and stagnating budgets mean many are turning to legal technology for help. Increasing productivity is the key driver for legal technology adoption among in-house legal departments. 53% said it gives them more time to focus on priority issues.

While these findings reveal how legal departments are developing internally, it also hints at how their needs from external counsel have changed.

In-house legal departments are demanding their law firm panels innovate through better use of technology and an open mindset to innovation, says Penelope Warne, senior partner at the UK office of international law firm CMS, which has its headquarters in Germany and 79 offices spread across 40 countries.

"Clients now routinely expect their law firms to bring solutions to the table that help improve efficiency and reduce costs," says Warne.

Having a global reach across multiple jurisdictions is something clients have sought from their law firms for generations now. While this is still useful, clients have become more strategic in how they're working with external counsel – with a growing number reaching out for the niche knowledge they cannot source internally. As a result, law firms are now expected to house a host of sector and practice area-specific specialists, which will be achievable for some but not all.

"As markets become increasingly complex and inter-connected, clients require the integrated capabilities of highly specialised practices and industry sector expertise while being able to seamlessly operate across borders," says Andrew Levander, the chair of US-based law firm Dechert which has 22 offices worldwide.

How technology enables law firms to improve their client offering

Greg Baker, global head of practice innovation at magic circle law firm Linklaters, says the smart use of technology has been critical in supporting its clients for some time.

"Our clients benefit directly from the technology we deploy. They can track the progress of deliverables on an online workspace, negotiate documents themselves on our CreateiQ platform or ask us to interrogate our award-winning knowledge databases for negotiating positions and 'what is market?' information."

Morgan Lewis's Murphy says," Our expansive technology portfolio and deep bench of technologists, engineers, data scientists, and process designers harness the power of data in service of our clients." 

"By automating and refining processes, we maximise internal efficiencies, reduce risk, and enhance the power and consistency of our services for clients."

An interesting example comes from Dechert, which launched its global Innovation Certification Programme in 2022. The programme, which most recently comprised 80+ lawyers and other legal experts, drives innovation throughout the business for the benefit of Dechert's clients.

"We are already seeing the benefits of the programme with new ideas for client solutions, new technologies, talent reward and recognition, and more," says Levander.

To read more on the inner workings of the world's largest law firms and the technology and services they offer, see the full UUÂãÁÄÖ±²¥ report here.