Blockchain has been making waves for a few years now. The financial sector took to Blockchain as an early adopter, and through its ability to secure even the most sensitive of data, Blockchain has now forged its way into law. But what uses, and benefits could it have?
What is Blockchain and why does it matter?
Accenture define Blockchain as “...a new way of storing data in a distributed ledger that allows multiple stakeholders to confidently and securely share access to the same information”
Why aren’t companies using Blockchain all the time? The answer is expense. Whilst it’s a very effective form of securing data, there’s a significant cost involved, alongside potentially expensive resourcing considerations. Not only is it costly, it’s also difficult to change the information retrospectively, meaning that any regular changes to Blockchain would mean lengthy stints delving into its complex infrastructure.
However, for the industries that have strict compliance laws enforced upon them, Blockchain makes a lot of sense in specific use cases, hence the appeal to financial services and now, law.
Where is law investing?
The courts – The British law courts are currently going through a modernisation programme that includes a move towards a more digitalised series of processes, estimated around £1.2bn. But where does Blockchain fit in with this?
The most logical area that Blockchain can help with is trials. The paper trail is immense; countless bundles of documents, containing hundreds, if not thousands of pages, the majority of which could be digitised. As an example, whilst a piece of paper usually costs just 1p, by the time you take into account storage and transportation, it can cost up to 25p per page. In this sense, Blockchain could prove more cost effective.
With a need to keep any highly confidential documents out of harm's way, Blockchain could be an effective way of doing so. The crown and family courts already adopt this kind of technology through “CaseLines”, as well as internationally in arbitration court. The next step would be to roll it out to other areas within trials.
Whilst it eliminates the paperwork, it also significantly diminishes the chance of falsification of documents. This is because in Blockchain’s very difficult to reverse any changes in the ledger. So, case notes, as an example, could be updated and added to, but they’d be particularly hard to remove or change.
The firm – Legal firms are looking to Blockchain for three main reasons as discovered in a poll. It brought to light that 41% of law firms are using or plan to use Blockchain for transactional legal services, so law firms sat within commerce could benefit significantly from this technology. 31% for high-value legal services (more complex cases than the transactional legal services) and finally, 21% say they’d use it for business support.
Law firm Kennedys wants Blockchain to form part of their motor claim process. They are looking at automating the claims to avoid a longer process, allowing both insurers, repair garages and hire companies to process claims automatically.
Kennedys Karim Derrick explains: “Blockchain will enable insurers to share their books with each other without exposing their books. This enables them to cross-reference claims and make it difficult for fraudsters to exploit the ignorance between them.”
The above clearly is a great use-case for Blockchain; ability to increase billable hours, client satisfaction and accelerating speed of service.
Strip your IT back and build it up
Whilst Blockchain absolutely has its place in the fourth industrial revolution, it’s costly both in terms of time and resource. So, transforming in other ways is likely to be more pressing for law firms, than firstly adopting Blockchain. Of course, for your most secure legal transactions, perhaps operating them through Blockchain is the best way, consider other methods too to avoid the costly overheads.
As the legal sector has been traditionally slow at technological advancement, it would be worthwhile to strip back legacy technologies before building more complex tools. It could be key to making those fundamental strides forward, and not get yourself tied up in knots from compatibility issues from legacy vs new.
There are many firms taking their first steps into flexible working. The four-day week is a hot topic right now, and many firms will be in the race to attract and retain the best talent, offering this as a company perk. Whilst perhaps rushing into this isn’t the right thing to do, certainly planning ahead could benefit your workforce from now onwards. But to do this, you need the technology to support you.
With clients demanding more from their law firms, using collaborative tools can bring about seamless communication, even if you and your lawyers work remotely. This is sure to increase productivity where your workforce is in and out of the office all whilst aiding customer satisfaction.
Find out more about how law firms are innovating their practices with Olive's latest research report here.