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Digitization will not replace the legal counsel, but help them to partner with business

The Netherlands seems to have taken on a leading role in Europe when it comes to legal tech. One of the  Dutch companies that have pioneered this field is effacts, offered by the Legal Software division of Wolters Kluwer. We spoke with Eveline Willigers and Caroline Cabezas, both from effacts, to discuss legal digiltalization.

LW: Tell us about your background?

Eveline: I joined effacts as a Sales Manager in 2011, and since 2016 I’ve taken on the role of Commercial Director. Currently effacts is market leader in the Benelux among legal software. We are part of the legal software division of Wolters Kluwer – global leader in information services and solutions –  enhancing and extending effacts’ offering around the world.

Caroline: I obtained my LL.M. in European Law from Leiden University in 2015. After working for more than three years at the Benelux Office for Intellectual Property, I joined Basic-Fit as an in-house legal counsel, where I managed a variety of commercial and corporate legal matters in a multi-jurisdictional environment, namely covering the Benelux, France and Spain. I’ve been a legal consultant for Wolters Kluwer since February 2017, working closely with the legal software division on effacts, a software product that empowers in-house lawyers.

LW: What’s your view on the state of digitization in the legal sector today?

Eveline: Our experience has taught us that it depends on the country. I would say that the Netherlands – where effacts is based – is more tech savvy compared to other countries.  However, legal counsel across Europe are finding it more important, especially compared to five years ago. Over the past two years we started to expand in the Nordic market and we notice that in-house legal teams are starting to warm up to the idea of sharing and storing information with legal tech tools. Digitization will continue to be a hot topic since data security and privacy are becoming increasingly important – especially with the GDPR coming into effect. Paper processes are the least secure option for legal departments because they don’t provide insights and control. There’s a real need for legal departments to digitize in the information age we’re operating in today.

Caroline: In the legal sector most legal departments fall into two categories – paper-heavy and paperless. One of the reasons they don’t migrate to paperless processes is because they feel the task is too daunting. This is the point where they need to realize that tools can help them. In the current age where there’s such a heavy flow of information, a person can no longer be expected do these tasks manually.

Eveline: Usually it’s a case that they don’t know how to digitize. It’s difficult to become tech savvy especially when the legal department has no experience with tools at all. The legal department is often the last to digitize as others moved on to more efficient – and most likely – cloud-based solutions. Instead, the legal department remains stuck in cumbersome, paper-based processes which are inefficient and costly.

Caroline: The role of the general counsel is evolving in that they’re expected to also take on the role of project manager, strategic business partner and advisor to the C-suite. The variety of work for the general counsel is greater and becoming increasingly complex coupled with a lack of time. This isn’t a sustainable way of working. Current surveys show that the legal counsel spend 30-40% of their time on average on administrative tasks and between 10-20% on complex legal issues. In other words, legal counsel are dedicating a lot of time to administration when they should be devoting more time to complex tasks. It’s unrealistic to rely on paper-based processes when there’s increasing pressure to perform and use time efficiently.

LW: Are there any new trends you have spotted recently?

Eveline: More companies are adopting e-signatures to digitize the signing process. A few years ago, they weren’t even considering it because there’s a misconception that that e-signature are not as secure as “wet ink.”  One of the advantages of digital alternatives is that they’re more secure.

When it comes to choosing the tool, general counsel are looking for the full package. For example, they want a contract management tool that will help with drafting so the whole contract is created with a click of the mouse.

Caroline: Even though general counsel are starting to become more familiar with digitization, they’re not fully convinced. This means there’s a gap between what people say they need and what they’re doing. In some ways, the legal department is out of touch. Highly publicized data breaches are occurring almost on a daily basis, and companies face extensive risks – not to mention also damage to their reputation. If the legal department is out of touch, how can they advise accordingly? The consequences are huge for companies who fail to act. Digitization is important because it helps us prevent, monitor and assess legal risks. A couple decades ago, data privacy wasn’t even a risk.

Eveline: What hasn’t changed is that companies want to work efficiently as possible, especially as the volume of work becomes greater. Legal departments are being asked to do more work with the same – or in some cases, fewer – resources.

LW: Are there any typical challenges in-house legal teams face with digitizing?

Eveline: The first thing that comes to mind is getting other stakeholders on board. Companies are reluctant to change processes that have remained the same for years. Even companies that already have a system in place can find it stressful to adapt a new routine.

Caroline: The main reason why companies are fearful is because of incomprehension. It’s important to have stakeholders on board because legal tech tools can help other departments to become self-sufficient. For instance, they can allow other departments access to information so the general counsel doesn’t have to answer every request.

The biggest challenge is convincing the general counsel to adopt a new system. Some legal professionals believe that legal tech tools exist to take away their jobs instead of help them. Even though you have a legal tech tool, you still need a human behind it. You must have a human who puts procedures in place and monitors them.

LW: Finally, do you have any tips to the legal counsel community or any quick wins that you can recommend?

Eveline: When you have a system in place you’re more in control because you can make informed decisions. You’re not doing guess work. For example, you don’t have to worry about missing a contact deadline and the penalties associated with missing it. The return on investment is high because legal tech tools can ensure you don’t miss these deadlines.

Caroline: These days the C-Suite expects the legal department to help them with business opportunities. That’s impossible to do when the general counsel has no idea of where these opportunities are because information is scattered across the organization.

LW: Thanks for this interview and see you at Nordic Legal Tech Day on September 21!

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