Technology remains the top strategic priority for law firms despite a reduction in levels of investment in the last 12 months, a new report from HSBC UK and The Lawyer magazine reveals.
More than four fifths (81%) of firms indicated that technology remains the most important area of strategic development activity for their firm, almost twice as much as the second priority to expand overseas (41%) and a merger or acquisition (28%) in third.
However, a little more than a quarter (27%) of law firm leaders in the UK’s top-100 practices said they would invest 5% or more of their revenue in technology projects, compared to 75% during the legal technology investment boom in 2017.
The report also focused on other areas of business strategy for law firms, including what their geographical priorities are for the next five years. The majority (68%) are focussed on UK operations with Europe (16%) and China (11%) following behind.
HSBC UK Head of Professional Services Sector Chloe Clift said: “While investment in technology is clearly still a priority, law firms are pulling back from new and innovative technologies to focus on their ‘business as usual’ systems that lie at the heart of operating an efficient modern law firm.
“Products and services that were previously seen as innovative tech are now, in many cases, established and require minimal additional investment. It’s also worth considering that some firms may be delaying investment decisions until the future of the UK’s relationship with the EU is clearer.”
Client collaboration tools were identified by 44% of firms as the top priority for tech investment, shifting investment in preventing cybercrime (15%) down to second place and focus on AI down to 11%.
Chloe Clift added: “While an increase in revenue across law firms means that tech investment has grown in real terms, firms shouldn’t be complacent, particularly around investment in preventing cybercrime.
“Increasing frequency and sophistication means that cybercrime should remain a focus for firms who could suffer damage to their operations or their reputation in the event of a serious breach.”
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