To say that the legal services profession is in the throes of digital transformation is an understatement. More data is created now than at any point prior since the invention of the computer. According to IBM, humans create 2.5 quintillion bytes of data each day. This creates a challenge with providing not only quality service to clients, but also fast and efficient service, in a legal context.
Progressive firms are realizing that by embracing this digital transformation, they can give themselves a competitive advantage by going deeper into that data than ever before. If a client wants to pursue a unique path on a case, it helps nobody for a lawyer to say “that is an excellent idea – give me six weeks to do research and analysis and I’ll be able to offer my advice.”
Instead, clients both need and want a lawyer to have the ability to immediately say “that is an excellent idea – here are all the reasons why you may or may not want to pursue that.” The issue is that Big Data is a lot like a broken water faucet – once you turn it on, there’s no going back again. So how do you actually embrace the sheer volume of data now available and make sense of it all? How do you separate the good data from the bad? How do you make sure you’re recognizing the valuable insights learned from the digital revolution as quickly as possible?
The answer is simple: predictive analytics.
What are predictive analytics?
“Predictive analytics” is defined as the process of using data to make predictions about potential unknown, future events. Used in a wide range of industries, predictive analytics uses techniques like statistics, modeling, data mining, and even machine learning to not just process data but to extract context from it. To look beyond simple numbers on a spreadsheet to get at the true story hidden inside.
What does this mean for legal services?
In many ways, predictive analytics in a legal context is not that different from what doctors and healthcare providers have been doing for years. Doctors leverage their knowledge of procedures, along with their years of experience, to patients during the decision making process. They don’t just inform a patient of their options – they also go over the potential benefits and pitfalls of particular paths, even if they all get to the same outcome.
So a doctor might say “Procedure A has a 40% chance of success with potential short-term complications in the form of X, Y, and Z. Procedure B has a 70% chance of success, but the complications are much more severe in the form of C, D, and E.” That doctor’s own experience coupled with insights support a much easier, more informed decision-making process on behalf of the patient.
Progressive law firms capitalizing on the power of predictive analytics find themselves in a similar situation for the first time. An attorney can now tell a client about both the risks and benefits of a different path towards the same goal with a greater degree of accuracy and efficiency than ever before. Firms are no longer relying on the experience of a handful of individuals, but instead have the power of many teams with a wider range of specialties to draw from. All this allows them to provide not only better advice to clients, but to do so with a greater level of confidence in their recommendations.
Embracing the (digital) workflow
Predictive analytics also has many interesting implications that go beyond simple client interaction. Consider the example of a law firm that represents certain types of businesses against various claims by workers, customers, and more. With predictive analytics, a firm could identify the most common types of triggers for claims. This would in turn provide them with insight about which practices the business would have to change or which behaviors they should avoid to reduce the number of these claims in the future.
Is it as simple as investing in more training for that business’ employees? Do they have an infrastructure issue? Predictive analytics could be the key to solidifying this answer once and for all.
Using predictive analytics to generate new opportunities
The benefits of predictive analytics also extend beyond giving firms the ability to offer personalized, differentiated client interactions and a deeper level of service. Making use of these types of insights can also help create new opportunities for nonlinear growth. It helps the leaders in a firm identify innovative ways to broaden the services they’re offering and to which clients.
Predictive analytics can help identify trends and uncover patterns that would have otherwise gone unobserved. It can help uncover new sales opportunities by providing open access to real-time business information. It can even help reduce the amount of time it takes for someone to go from prospect to client.
This one simple decision can not only help support the goals of the firm today. It can also help make sure that larger firm activities align to support the type of firm it one day hopes to become.
Most legal pros will agree that their most valuable asset comes down to a single word: people. Modern law firms are developing sophisticated strategies. They understand that lawyers are more than just tools. They’re resources that use the power of their experience and expertise to create better, more meaningful outcomes for clients on a daily basis. Predictive analytics is a natural extension of this. They’re using this insight and experience to their advantage by harnessing Big Data, creating opportunities for more meaningful interactions and superior service moving forward.
Find out more about how digital transformation is impacting the legal services industry. Download and enjoy a complimentary copy of our new white paper “Legal 3.0: Navigating the Trends Driving Change in an Increasingly Digital Legal Industry,” available in our online resource center. While you’re there, feel free to explore a host of other resources, all designed to help you reimagine your business in the best possible way.