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3 Changes Affecting the Legal Industry and How Lawyers Can Adapt

legal-industry-changingThere’s no doubt that the legal industry is undergoing a transformation. Only time will tell to what extent these changes impact the future career prospects for young lawyers and law students today. Is the industry merely undergoing an “update” of sorts? Or is this a complete overhaul, where a substantial number of law jobs will disappear over the next 10 years?

The outcome isn’t clear at this point, but to maximize your own chances of survival, you need to be aware of how the market is shifting and understand the drivers of change – the underlying forces bringing about this “new-look” legal industry of the future. Below is an analysis on three changes affecting the legal industry today, along with some of the impacts those changes may have on your career.

1. Technology is reducing your role and your value

You probably could have guessed technology would be first on the list.  For one, it’s usually a major driver of change in any industry.  And you probably noticed some of the inroads technology has already made into the legal industry’s rigid, old ways.

Technology is driving change in the legal industry for a few reasons.  First of all, it’s enabling greater accessibility to legal knowledge and information.  People no longer immediately turn to lawyers for legal advice.  They now turn to Google, Avvo, Quora, NOLO, and other sources of free legal information.  In many instances, it’s possible to get all the answers you need without ever talking to a lawyer.

Furthermore, technology is reducing demand for traditional lawyers and law firms, or in some cases eliminating it altogether.  Companies like Axiom Law in the corporate world, and LegalZoom in the consumer space have leveraged the power of technology to increase efficiency, lower prices, and streamline the provision of basic legal services.

Most lawyers have taken note of these changes as they’re happening, but technology has barely even scratched the surface.  We will continue to see more technology driven legal service offerings emerging in the future, reducing demand for the classic law firm business model even further.

Lawyers will have to find ways to leverage the power of technology for themselves if they are going to survive the disruption.

2. Clients won’t keep paying your inflated, hourly bills

Most lawyers have observed this change happening as well. But it might be one of the most significant changes and one that will have a huge impact on the market in the future.

The billable hour is all but dead, and it deserves to be.  Billing by the hour means motivations don’t align.  It means unlimited costs for clients.  It means downright dishonesty in some instances.

When you are getting paid for your time and the client has very little or no control over how you utilize that time, you have every incentive to work as inefficiently as possible. It doesn’t make sense, and people are finally fed up.

Also going by the wayside are the overinflated rates being charged in the current market. The margins on most legal work are astronomically high compared to other industries if you think about it. The majority of other “brick and mortar” type businesses such as those in the retail or hospitality industries operate on razor thin margins. You have to admit it doesn’t cost much more than your time to review a document or consult with a client on the phone.

Legal fees have largely been free from the market forces of supply and demand throughout history, with lawyers dictating rates to an uninformed public with limited options for legal help. But the Internet is changing things, providing people with alternatives, creating transparency around pricing, and shedding light on the industry’s shady billing practices.

Your time is becoming less and less valuable to people. You won’t be able to continue to bill for every phone call and email or charge thousands of dollars to draft a document. People simply aren’t going to put up with it anymore, and they won’t hesitate to find alternative service providers offering greater affordability, productivity, and efficiency.

3. A focus on operational efficiency is becoming mandatory

Operational efficiency is crucial in any successful business, but in law it will become particularly impactful as the overall demand for lawyers diminishes and clients become less willing to pay the current rates.

People expect efficient, quality service from anyone they do business with these days, and it’s about time lawyers catch on to the trend. Your ability to acquire new clients affordably while providing quality legal work and good customer service will become essential to your survival as the market continues to shift.

The reason Axiom and LegalZoom and other alternative legal service providers have done so well is because they glommed on to the things that matter most to the buyers of legal services – efficiency, transparency, and affordability. Although these services still have their limitations and they can’t do everything a traditional lawyer or law firm can, the movement has only just begun.

If you intend to compete with these more efficient and cost effective alternatives, you’ve got to do whatever possible to mirror the value proposition those services offer to clients. Specifically, you need to increase efficiency and decrease overhead expenses so you can offer services at more affordable rates.

If you work on finding ways now to increase efficiency and lower your overhead so you can compete on pricing, you’ll be ahead of the curve compared to other law firms as these new alternative legal companies continue to capture market share.

Adapting for the Legal Industry of the Future

Many lawyers tend to deny the changes taking place, ignore them, or resist them, but doing so is the worst possible way to react. It’s not a fad or a temporary trend. The market is changing, and certain legal professionals that refuse to acknowledge it may end up facing their extinction.

In order to prepare for the legal market of the future, you should take steps now to adapt to the changing market. Here are three things you should focus on:


Get familiar with it and use it to your advantage. Learn about basic online marketing, SEO, web programming, social media, etc. These tools will become invaluable for client acquisition, as more and more people look for legal help online. Get started here by learning how to build a law practice online.


So many lawyers think that reducing their rates will cheapen their product or make them look low-end or inexperienced. There is a certain perception of quality that comes with expensive goods and services, but when it comes to legal services, clients usually can’t tell the difference in the quality of your work anyway. They care more about how competent you seem when you advise them, how personable you are, and how well you communicate.

By charging more reasonable fees and avoiding hourly billing for little tasks, you will be able to increase client volume and retention, generate more referrals, and ultimately make more money than by billing fewer clients at $425 an hour every time you talk to them on the phone.


Inefficiency is probably the biggest problem confronting the legal industry as a whole. It affects every area from lawmaking to litigation, and above all, the market itself. The market for legal services is slow moving and fragmented, making it inaccessible to consumers. The majority of lawyers and law firms still do not operate their practices like the businesses they are. While businesses in other industries strive to find every possible way to cut costs and improve operations so they can offer affordable prices and keep a competitive edge, law firms tend to do the opposite, over-billing the few clients they do have at every opportunity.

It’s time for the legal industry to wake up. Lawyers are in a business no different from any other – the goal is to provide value to your customers and make more money by selling goods and services than you spend in the process. The more efficient you can be at every step along the way, the more successful your business will become.