3 Hacks on Getting Budget for Legal Technology

April 6, 2023
July 4, 2024

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For many in-house legal departments, budget is a significant concern, particularly when it comes to procuring more tech. This is because legal teams traditionally have little to no technology budget, stunting any exploration in legal technology adoption. Since technology has never been an expense line for the General Counsel, it is often the case that they do not know how to build a legal business case or have a conversation with their CFO to rationalize spend in an area that hasn’t required spend up until now.

Just because there hasn’t been any budget in the past, doesn’t mean that there shouldn’t be any available now. Like many of their counterparts in other areas of the business, such as HR or finance who have enjoyed a technology-enabled function for years, legal have the same operational challenges and do, in fact, require technology built for their function. However, pushing for a budget towards legal software is the responsibility of the legal leadership team. The CFO and other parts of the business are not going to simply allocate technology budget without realizing its importance for legal innovation, so it is up to legal to advocate for it.

This may be easier said than done since finding budget is challenging, even when there is a will. Securing budget is both a science and an art. It is a science in the way you build the business case and an art in the way you sell it to the business. Probably the most important principle is that you’ll rarely get given budget if you pitch technology as solving a legal problem. Those holding the keys to the budget need to see this investment as solving a business problem. For instance, better document management isn’t just about lawyers spending less time filing documents from email and searching for documents, it is also about the business getting their document requests faster. In the same way, automated legal advice tools aren’t just about saving lawyers time, they are about the business getting legal help faster and progressing more deals which impacts top line business growth.

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3 Hacks on getting budget

Despite the advice above, finding budget is still tricky. So here are three hacks that you can leverage for your best chance at success.

  1. Start with automation

    Legal automation as opposed to other forms of legal technology, has the most direct and explicit benefit to the business because it improves the way the business engages and receives legal services. Its benefit is most visible to the business and therefore, will pave the road for further budget for other In-house legal software investments.

  2. Find a use-case that solves an apparent problem for the business

    The pandemic, Royal Commissions, and regulatory systems like the Notifiable Data Breach (NDB) scheme are all recent examples of legal-led or legal-involved processes that have opened new gaps in operational and risk management that force large-scale change where legal is often best placed to help solve.

  3. Collaborate with trusted software vendors to learn how to navigate buying technology as a legal function

    Whilst it may be an activity that you're doing for the first time or infrequently, this is an activity that legal technology vendors do day-to-day across multiple organizations. They're incentivized to put in the work for you, so take advantage of their expertise and knowledge.

In summary, securing budget is less about finding it and more about creating it. It is the responsibility of legal leadership team to present an effective business case, and with the right approach and stakeholder buy-in, it is possible.

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