Blog Post

How to Develop of a Culture of Innovation and Why It’s Not Just About Technology

October 15, 2020

Innovation is hard  it’s not simply deploying the latest legatech – it’s a mindset change. Here we give you six practical ways you can start cultivating a culture for innovation inside your organization 

You’re being asked to innovate, to ideate and to transform your department or your law firm. So you start to evaluate the legal technology available, and asking questions; what has a good reputation, what drives value, what works easily and quickly? The choice is overwhelming, you have no idea where to start.  

Sound familiar?  

The challenge here is that being innovative and using technology are two very different things. All too often when discussing or researching legal innovation, the only outcome is technology. While, unarguably, technology can form a foundational part of innovation in any organization and help to drive innovative ideas, it is only part of the answer.  Certainly, innovation can occur without the need for dramatic technological change.  

The challenge is creating and nurturing a culture of innovation within your law firm or department and then using technology to augment this cultural shift. Realistically, in a sector that’s naturally bound by tradition and adverse to change, cultivating a culture of innovation is going to result in some casualties. 

However, law firms that are not prepared, or willing to make this shift will be overtaken by those new, more entrepreneurially-spirited law firms and GCs, or lose their best talent and clients to those firms who have already taken the leap.  

So where to start your innovation journey 

  1. Understand exactly what a culture of innovation means 

    Sounds obvious, but innovation isn’t just about applying new technology or new processes to something to make it work better. It’s about being open to new ideas, about helping your teams to think differently about traditional methods. It’s thinking the opposite way round – don’t go through the maze – go around it.  

    Given that millions of businesses across the world began remote working with just a few days notice during the pandemic, we all know that anything is possible. Now is the perfect time to replicate this open-mindedness and reimagine other areas of your legal team, processes, and clients. Ask two sets of questions: what are your biggest pain points and what your client’s biggest pain points are when working with you.  Where the answers to these two questions overlap is the place to start ideating and formulating an innovation strategy.  

  2. Find the right people 

    Legal touches every point within the business, from sales contracts to research, marketing to operations. And, although further down the line collaboration with these departments will be key, finding like-minded individuals who are open to innovation within just the law department is solid step.  

    At Exigent, during the pandemic, we wanted to capture the thinking we’d cultivated during the accelerated move to remote working across our business. Rather than just forming a group with the usual senior leaders, we allowed our employees to pitch for a place on one of our Plan Ahead teams, who would be tasked with innovating and ideating for our future.  

    In this way, we recruited those with open minds and new ideas, dispelling those ‘it didn’t work last time’ myths and ‘that’s too difficult’ excuses that penetrate every organization and prevent real change.

  3. Lead by example 

    It’s a business idiom that people support what they help to create, so as a leader you need to take people with you on the shift to new mindset. Agreeing to a meeting once a month with an offer of enthusiastic support isn’t enough. They need to understand the value of innovation and be immersed in an environment that supports innovative thinking. The cliché of there’s no such thing as a bad idea isn’t enough. It’s up to you to show your team that unreasonable thinking is what’s needed. 

    This article from McKinsey highlights the need to encourage setting the bar beyond what is reasonable.  While it might not be achievable, it opens the mind to what could be possible. However, McKinsey stresses the need for ‘innovation parenting’ – providing roots and wings for the team, so they’re accountable for their ideas, to prevent wasted time, money, and effort.

  4. Support from the board 

    It’s not just your team and the innovative individuals that you need to take with you on this cultural shift – it’s the boardPut simply, innovation won’t succeed unless there is board support. But this might not be as big a challenge as it once was, especially in light of recent events. This article from Harvard Business Review (HBR) was already discussing the need for the boards to embrace innovation several years ago despite the inherent risks that it often represents. 

    And this is already happening, according to a recent report from EY.  Boards are asking better questions and are becoming ‘futurefocused while managing short-term strategic business needs’. However, while more open to ideas, these must make commercial sense. 

  5. By demonstrating Commercial Awareness 

    While the board might be more open to innovation, their focus is still on the commercial viability of any project or operational change.  It might be productivity increase, preventing revenue leakage, or just outsourcing lowerlevel tasks to free up time for highervalue client counsel. The divide between the practice of law and the business of law can be closed by aligning your innovation strategy with your business strategy. 

    One basic way of achieving this could be proposing that lawyers or legal professionals who work on innovation projects count these hours as billable. Yes, the board are likely to balk at the idea at first, but it demonstrates the seriousness of what you’re trying to accomplish, while simultaneously showing that you understand the commercial implications of driving innovation.

  6. Now its time to look at technology 

    Most people start here and work backward. But without first nurturing a culture of innovation, adopting any new technology – no matter how glossy the headline, the features, and the functionality – the chances of it becoming expensive shelfware are high.  

    Technology helps to drive innovation and augment new ideas and process changes. In most law firms and departments some processes and tasks could benefit from digitalization and automation, but only when the benefits of this technology can be justified beyond ‘we think we should do it’. The business challenge comes first, and the technology is overlaid as one part of the solution.  

    Don’t be fooled by fads or shiny new technology trends that promise to solve all your business issues.  While legal tech is a huge industry (worth around $17.3bn last year), many of the startups don’t have the legal knowledge or experience of working inside our sector.  

Creating innovation and cultivating it not just across your team, but throughout the business isn’t easy, or quick and it’s notoriously difficult, as PwC recently commented on its recent CEO survey. Across all sectors, 55% of CEOs admitted they are not innovating, and only 50% believe they have a winning strategy for the future.  

And, it’s even harder for legal. Innovation is often seen as being at the expense of risk, and for legal professional, that idea is so alien, so counterintuitive to their legal upbringing, that it presents a complete mindset and cultural change. However, many legal professionals are realizing that avoiding risk by lack of innovation is the riskiest risk of all.   

We recently produced a newsletter all about how to think differently and reimagine legal. Start innovating today and get your copy now.