Getting to Know The Global Legal Operations Software Market: The Recent Trends and Forecast for the Future
In the last few years, the adoption and implementation of legal technology software and cloud-based solutions have increased tremendously. In fact, according to a Data Bridge Market Research report, the legal operations software market is expected to grow at a rate of 14.1 percent between now and 2027.
Driving this rapid increase in adoption is the technology’s ability to help with everyday work, reduce costs, and protect data. In essence, legal ops software includes tools that help legal departments manage day-to-day legal spending and keep records of workday activities. Manually managing these legal activities and recording data is extremely time-consuming, preventing lawyers and allied professionals from focusing on higher-value, strategic work.
Now, let’s explore the global trends we can expect to see in the next few years — those highlighted in the Corporate Legal Operations Consortium’s (CLOC) 2021 State of the Industry Survey report.
Increasing Legal Spend
In the last couple of years, alone, legal teams have greatly increased their expenditures
— when it comes to upgrading their departments with technology. On average, legal technology spend increased to $1.2 million in 2020, with medium-sized companies spending as much as $1.7 million, according to CLOC.
Increasing Productivity of In-House Counsel
Naturally, along with an increase in legal spending comes (hopefully) improved productivity. Simply put, when more money is spent on technology innovation for in-house legal teams, they can carry out their legal work far more efficiently and effectively. This is especially true if legal ops software automates and facilitates those more mundane legal tasks. According to the CLOC survey noted above, 39 percent of respondents said that legal tech helped to bring in more work for in-house counsels in 2020, compared to 28 percent in 2019.
Creating Larger Legal Departments
Today, media, biotech, and pharmaceutical companies have the highest number of full-time employees in their legal departments. The average legal ops team, on the other hand, supports roughly 23 members. In 2021, 40 percent of respondents told CLOC that they increased the number of full-time legal ops employees the previous year. Mid-size companies, in particular, saw the highest number of increases.
Changing Legal Operations Responsibilities
As of the present day, the most common legal ops services are as follows:
- Process development and project management
- Data analytics
- Technical and process support
- Vendor management
- Financial management
These responsibilities are the same as they were in 2020. But with the expanding influence of legal ops professionals and continuing increase in their numbers, there’s a growing perception in the legal industry that legal ops responsibilities have much value.
Legal Operations Software Market: Forecast for 2021 & Beyond
In order to continue evolving digitally, in-house legal departments and legal operations need to constantly change their priorities. They should focus on the adoption and implementation of legal technology, such as AI-driven, unified legal platforms, which automate legal processes and help legal professionals take on more strategic work on behalf of their teams and companies. This growing need is reflected in research from Gartner, which says that tech spending has already increased 1.5 times in the last few years — from 2.6 percent of in-house budgets in 2017 to 3.9 percent in 2020. According to Gartner, legal tech spending will make up 12 percent of in-house budgets by 2025 (that’s three times more than in 2020 for those who might be counting!)
If your legal department needs help choosing the right legal platform, check out one of our latest white papers on the subject, “How to Choose a Contract Management Solution.”
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