Why BRYTER might (not) be the right choice for innovative law firms
Personal learnings from participating in one of Germany’s first Legal Tech Summer Challenge
For six weeks, I spent some of my free time exploring the legal tech scene in Germany after having successfully applied for the Legal Tech Summer Challenge 2020. Organized by the Munich Legal Tech Student Association (MLTech) as well as Reinvent Law and sponsored by Baker McKenzie Germany, the goal of the challenge was to solve real life problems of inhouse law-firms in an innovative way. Thanks to the excellent organization, diverse pool of selected applicants and willingness of all the participants to share their experience with me, I had a lot of fun and learned a ton of interesting insights about the legal industry. In this blogpost I wanted to share some of my key learnings and opinions on the future of the legal tech field.
Innovation without hard tech skills is hard
One of the things I appreciated the most about the event is the complete diversity of all participants. While most had a legal background, there was also a safe space for participants like me who had a management/tech background and no clue about the law. With limited skills in programming or other technologies there is de facto only one big player in the German legal tech domain to create innovative products in a short amount of time which is called BRYTER:
The leading no-code building platform to automate decision making, helping experts to deliver knowledge fast and efficiently
Unsurprisingly, many teams used BRYTER as default tool for any challenge they got. Quite surprised about the quick and widespread adoption, I had the chance to talk to many participants as well as industry experts outside the challenge to learn more about the state of legal tech and how BRYTER could become such a hit with law firms or inhouse law departments.
A troubled German Legal Industry
The legal industry in Germany remains one of the last industries to be touched by digital disruption. Legal services as well as laws have almost not changed and the core system has little incentive to do so.
Traditional partner structure
Most law firms come with the traditional partner structure. To become an equity partner you bring clients to the firm, retire and take your money out. Consequently, most partners do not want to invest a whole lot of money in risky digital projects, but prefer to pay out dividends or set aside larger sums in case any partner wants to leave the firm. Also without a legal background you cannot actually become a partner at a German law firm.
The curse of billable hours
The more hours a law firm can bill, the more they can charge the client. Having digital tools that automate work and reduce billable hours hence does not increase revenue. Even more problematic is that an associate who does not work on a clients task does not generate any revenue. Therefore, an associate trying out a new legal tech tool that could potentially save a lot of time and reduce billable hours is counterproductive.
No standardized processes
Although steps for a typical M&A acquisition are quite repetitive and almost the same, many employees have their own way of working, making it hard to standardize and align all these steps for automation. Apparently, most lawyers like to hold on to their way and see little compromise in adopting a more generalized approach.
The next Ryanair moment in legal tech?
Summarized, law firms did not feel any pressure to change just yet, given the historic protection by law itself that only certified personnel such as attorneys can carry out legal services. However, the market for legal services sees liberalization for standard claims and out-of-court legal services. The highest court in Germany (Bundesgerichtshof) recently ruled for startups like wenigermiete (reducing rental prices) or flight right (refunds for delayed flights) to carry out some basic legal services.
With the emergence of these legal tech players, I see some similarity to Ryanair’s business model. Ryanair has only one aircraft type for which all pilots are trained and for which they need the same spare parts. Furthermore, there are no extras, such as catered food on the flights and only cheap airports are chosen as destinations. With this strategy, Ryanair is able to deliver a flight at a much lower cost than competitors, focusing on quick turnarounds of planes on the ground thereby increasing overall throughput and attracting more customers.
Similarly, I feel that law firms will see a reduction in revenue at first with more digitized and automated processes that reduce billable hours. However, firms excelling at standardizing and automating most of the boring work, will be able to increase efficiency and ultimately output as well. This in turn will lead to lower prices for customers and attract clients in the long run, allowing lawyers to really focus on solving challenging problems that cannot be automated or solved with machine learning (yet).
BRYTER as (non) innovative tool for law firms
With the increasing pressure from firms to reduce legal costs and the fear of having a startup disrupt the legal business, legal firms are quick to jump to buy BRYTER licenses to start digitalisation. As tasered here are my top 3 reasons why law firms should not prematurely adopt the next best tool like BRYTER, but invest more time and resources in open source software to become an independent digital leader.
1) BRYTER is not solving the core problem yet
Like most tools, BRYTER promises out of the box easy and rapid prototyping. Which is true for very easy use cases like constructing a decision tree that yields to an outcome or easy document. While those are perfect for a proof of concept or to get others convinced to invest more, they likely only reflect a small amount of actual real life use cases that a company would like to solve.
What surprised me even more during conversations I had with people in the industry and also during the legal tech challenge is that most often lawyers still do not feel comfortable enough to use the no-code visual editor of BRYTER. In fact I learned that most often successful BRYTER projects were actually completed or taught by younger law clerks or working students but not seasoned lawyers or partners.
Similarly, during the summer legal tech challenge, firms leveraged the students interest in tech to solve the problems with BRYTER. Personally and probably also connected to my non legal background, I felt that actually one of the biggest challenges among all the groups was to reduce a complex (legal) document, process or question into a series of logical decision trees that could then be digitized and put into any sort of tool. Creating Business Process Models or decision trees seems to be something you would not typically learn in law school, but that you could even do on a white board without any fancy technological tool, or yet again free open-source software on the internet like Draw.io.
So do you really want to invest yourself long term in a no-code solution that most still do not adopt or feel comfortable using and where the real challenge remains to align and standardize legal processes among your firm into a sort of decision tree or process map?
2) BRYTER is not suitable for complex use cases
Real world company problems come with a whole world of complexity and often involve the inclusion of other systems or processes present in the company. While the killer feature of having a no-code visual editor is one of BRYTER’s main strengths it is also its biggest disadvantage.
With BRYTER common tasks, such as connecting and reading data from a relational database become impossible without the help of a so called “integration layer”, that at the moment — when I tested BRYTER — was not accessible via the visual editor. Many companies keep on falling for extremely well marketed software products with all bells and whistles. However, once you purchase licenses and actually attempt to solve more complex real life problems you will soon realize that it cannot deliver on all promises and the requirements you have as a company.
No-Code solutions are built on pre-defined functionality that cannot be extended or changed to fit every company’s use case. Hence they are constrained to being general enough to solve most clients problems. Similarly, no-code visual editors also bring some overhead requiring people to do quite a few clicks or visual changes to get what they want implemented. Therefore, a typical BRYTER interview looks simple when you use it, in the backend however a significant amount of time is spent on clicking and visually editing complex interview logic that can slowly become overwhelming. Code on the other hand offers abstraction, simpler and more elegant solutions to build complex and customized interview logic that most often does not come out of the box.
3) A BRYTER vendor-lock in limits innovation
With law firms investing a mid five digit figure for one BRYTER license, companies are locked in and forced to show stakeholders some return. This commitment also means that all interviews, decision trees are locked in the BRYTER platform. Similar to Microsoft, SAP or Salesforce at a point in time companies are highly dependent on these systems and do not have any flexibility to switch to another vendor given the missing data portability.
Open-source on the other hand is completely free to use, does not have any complex licenses and requires no commitments up front. This is why many of the most successful companies and especially startups embrace open source. It gives them room for quick experimentation and flexibility to build and play around in a rapidly changing world.
One of the key factors of open source is that everyone can build and extend functionality, which I think is one of the key differentiators to BRYTER. In the future, a law firm can only be as competitive as any other firm using BRYTER. With all firms having the same functionality available, they can simply copy interviews and processes from one another.
Those law firms who figure out how to build some more custom interviews, with more advanced functionality, such as OCR, machine learning or other useful features will be able to create a true competitive advantage delivering customers innovative features that no other firm can do.
Tools like BRYTER will disrupt the legal sector
Last but not least, one has to acknowledge the difficult and pioneering work companies like BRYTER are doing at the moment. As mentioned before, the demands of private and business clients seem to change within the legal sector. Therefore, law firms will have to reinvent themselves on a long-term basis, which the majority of law firms and lawyers still seem to neglect. Especially young lawyers and students seem to be interested in the new legal tech developments, which will eventually lead to making their own demands on how a law firm should operate and use digital tools.
How TripliQ helps companies
At TripliQ we specialize in helping law firms to experiment and understand open source software. With a friction of the cost compared to other vendor solutions, we co-create innovative proof of concepts and help customers build their own truly innovative, customized solutions to their problems. For more information mail firstname.lastname@example.org or check out our website to learn more.