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Market Analysis

Tim Cheadle (Asia) - Technology Adoption Key as Local firms Compete in a Deregulating APAC Market

The current trend of deregulation of the legal services market in Asia Pacific is heralding a period of change in the region's legal sector as international law firms are being allowed to open representative offices in some countries. For instance, with the European Union - Korea Free Trade Agreement (FTA) coming into force, UK law firm Clifford Chance has announced that it is establishing a presence in South Korea. Also, DLA Piper says it has signed an agreement with a Mongolian law firm to enter South Korea's legal market. This trend will be further abetted once the US-Korea FTA legal services agreement, which even though delayed, will eventually be ratified. These legislations are designed to increase competition in the legal services sector and so will impact local legal firms' businesses.

Similarly, the legal services market in Singapore has already had a head start with six foreign law firms being awarded licences to practice local corporate law way back in December 2008. And perhaps in the tightest of all markets, over 130 international law firms have a presence in China today.

Local firms in these regions can no longer carry on delivering legal services as before. Increased choice is making the customer more discerning - enterprises are demanding value for money and legal services providers now have no option, but to revisit their business strategy and critically think about how they deliver services to meet the stringent customer demands profitably.

Adoption of technology is indispensable. It can help increase operational efficiency, maximise productivity and drive profitability. Underpinning the firm with technology systems can also help easily create new services and revenue streams for business growth.

For instance, an integrated relationship management system can provide a 360 degree view of all client and matter centric information, providing real-time insight into the status of every client - right from progress of legal matters, billing and accounting to key performance indicators and profitability. This level of visibility will allow law firms to anticipate client requirements, delivering innovative and improved client service.

In a heavily relationship-orientated legal services sector, a mature approach to customer relationship management is imperative. Contacts, relationships and networks play a major role in business development. Local law firms must be able to identify, track and nurture relationships that exist within their organisations. Undertaking this function manually is an impossible task. Firms must consider deploying systems that enable them to harness the relationship intelligence that exists within their organisations for business development. Further, such systems also help with marketing initiatives, automating a big chunk of the non-billable activities.

Most western law firms already have systems in place that can speed up the time it would typically take to establish their presence in new markets. However, local firms can gain significant competitive advantage over incoming practices by leveraging technology to supplement their superior market knowledge. They should consider adopting systems that integrate customer relationship management, practice management, billing, case and matter management, risk management, regulatory compliance, document management and knowledge management, on a single platform. Such systems will help them enhance their services as a matter of course and build on the advantage they already have as local businesses.

By Tim Cheadle, General Manager, LexisNexis Enterprise Solutions

 

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