Solo and Small Firm

ABA TECHREPORT 2016

Sofia S. Lingos, Esq. is the managing attorney at Trident Legal LLC—an innovative law practice out of Boston, MA providing transactional services to small businesses and start-ups throughout the business life cycle. She is also the business law advisor at Lawyers for Affordable Justice (a collaborative legal incubator), an adjunct law professor at Northeastern University School of Law, and an active member of the ABA Law Practice Management Division. She writes and speaks often on topics relating to law practice management and business law matters. Additionally, she is actively involved with numerous, community, professional and philanthropic organizations.

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Solo and small firm (2-9 attorneys) practitioners make up the majority of our legal profession, compared to medium sized firms (10-49 attorneys) and large firms (100+ attorneys). This year, 62% of respondents to the 2016 ABA Legal Technology Survey Report were from solo and small firms (30% and 32% respectively). The majority of solo and small firm respondents were more experienced, with 53% of solo respondents and 47% of small firm respondents having been admitted to the bar for more than 30 years. The average age of all respondents was 54, with an average of 26 years as members of the bar. Gender did not seem to present a significant disparity among reporting solo practitioners, with 33% being female and 32% male. Overall, the gender gap was at its widest in respondents 60+ years of age, significantly narrowing alongside a decrease in age and years admitted to the bar.

The 2016 Survey introduces the most commonly available and utilized tools and technologies in law firm settings, provides insight into how practitioners are thinking about technology, and presents quantitative evidence from which we can extrapolate predictions for the evolution of our field. As trained critical thinkers, we do not typically turn the lens toward the business aspect of our practices, and we are often more comfortable with qualitative analysis. However, the 2016 Survey allows us to evaluate our profession more critically, and, if applied correctly, gain a competitive edge.

Technology is in a constant state of development. Solo and small firms are uniquely situated to best take advantage of these advances. Accordingly, companies developing legal technologies and general business tools have been focusing their efforts on accessible products for small businesses, leading to an abundance of options available. Knowing what these tools are, how to evaluate them, who is using them, and for what purpose can be the difference between building smart and efficient operations or breaking the bank on purported products that do not provide one’s desired solutions.

Many attorneys, especially those more experienced, find the field of legal technology to be overwhelming. A common response has been to maintain status quo operations, avoiding and ignoring innovation. Unfortunately, the bar has determined that this is not an acceptable response. In August 2012, the ABA Ethics 20/20 Commission recommended revisions to Model Rule 1.1 regarding competent representation. The changes included extending Comment 8 to clarify that competency included knowledge about “the benefits and risks associated with relevant technology,” judged on a reasonableness standard. To date, 23 states have adopted the new Model Rule Comment. Technological incompetence is not merely a disadvantage, it may be an actual ethical violation. Understanding how our colleagues are operating within the field can also assist us in understanding what a reasonable expectation for the understanding of technology looks like.

Top Billing Practice Areas and Fees

The 2016 Survey asked respondents to report on their top practice area based on billing. A stark separation between solo and small firm practitioners was the small firm attorneys’ (31%) alignment with medium and large firms, with all indicating that litigation was their most profitable practice area. The top five primary practice areas for solos were: Estates, Wills and Trusts (33%), Family Law (22%), Real Estate (19%), Contracts (18%), and General Practice (17%), followed by Litigation at 16%.

With regard to billing, solos (53%) and small firms (55%) also stood out from medium and large firms, who clearly favor the billable hour (78% and 84% respectively). 25% of solos and 17% of small firms offer fixed fees, with approximately 10% of medium and large firms offering the same accommodations. Small firms offered the highest percent of contingency fees at 17%, followed by solos at 10%. Client demand for alternative fee arrangements is ever-increasing. Having the flexibility to adopt some of these structures as a solo or small firm can provide a significant advantage over medium and large firm competitors.

Hardware


Computers

The most critical piece of hardware in an attorney’s arsenal is by far the computer. If searching for a bright line requirement for technological competency under the new Comment 8 to Rule 1.1, a strong argument can be made that not using a computer would violate the ethical requirement. Whether to use a laptop, desktop, or both poses a more challenging question. 72% of respondents from small firms reported using a desktop as their primary work computer, while 61% of attorneys in firms of 500+ report using their laptop as their primary work computer. 83% of solo practitioners and 75% of small firm attorneys reported personally using laptops for law-related tasks. Laptops can permit you to work with more mobility while traveling or at home. Desktops may offer a more secure network in an office and a dedicated work environment. Both options have their benefits, many of which can be duplicated through additional tools and technologies.

Among those respondents who provided brand names for desktop computers available at their firms, Dell was cited most often for desktops (57%), followed by Hewlett Packard (30%), IBM/Lenovo (13%), and Apple/Mac (12%). Among those respondents who provided brand names for laptops available at their firms, Dell was cited most often (37%), followed by IBM/Lenovo (22%), Apple/Mac (20%), and HP/Hewlett-Packard (19%).

Tablets

While not new on the scene, the ability for tablets to replace computers/laptops is rapidly expanding. Previously, these app-based devices had a difficult time providing full office suites and other tools relied upon in the legal field. However, between the Surface Book, adaptable keyboards, Apple Pencil, new iPad Pro, and advances in apps, these lightweight devices are becoming laudable competitors. Even if not used as a primary device, developers are creating powerful legal and business apps to assist in all areas of practice and firm management, which may make them a beneficial addition to your toolbox.

Solo and small firm practitioners are the most likely to report the availability of tablets (67% and 59% respectively). The most commonly used were: Apple iPad (77%), Microsoft Surface (19%), Samsung Galaxy (9%), Amazon Kindle Fire (7%), Google Nexus (4%), and Asus Transformer (1%).

Operating Systems and Servers

The current version of the Microsoft operating system is Windows 10, released in 2015. 30% of respondents indicated that they were currently using Windows 10. The majority (34%) of respondents were using its 2009 predecessor, Windows 7, though history does show that more people are converting each year (47% in 2015, 54% in 2014, and 52% in 2013). 16% of respondents are using Windows 8, and 5% of respondents report using Windows XP (which was first released in 2001). Only 8% of respondents reported using Mac OS, with the majority being solo practitioners (12%) followed by small firm practitioners (10%).

Overall, 72% of respondents reported having servers available at their firm. However, only 35% of solo respondents reported having servers available, in contrast to 84% of small firms. This could be because servers are more important for multiple attorneys sharing information in one firm. However, it is a note of import that, going forward, many of the traditional servers’ functions can be accomplished by cloud computing services.

Hardware Accessories

When asked about the availability of hardware accessories at their firm, with regard to printers and copiers, more than 80% of respondents indicated use of multifunction printers, 72% use laser B&W printers, 69% use copiers, and 59% use color laser printers. Without a secondary device, many argue that there is a risk of relying on a multifunction printer. This risk would result in a shutdown of printing, scanning, and faxing all at once. Other hardware accessories available at respondents’ firms are sheet-fed scanners (46%), external hard drive (45%), inkjet printers (39%), flatbed scanners (31%), and portable printers (14%).

Communication Software


Email

All respondents reported the availability of email software, with only 98% reporting personally using email for law-related tasks, so the assumption by clients and colleagues to be able to contact a practicing attorney by email is likely a reasonable expectation. The products identified by respondents as available most often at their firms are: Microsoft Outlook (77%), web-based email (19%), Outlook Express (11%), and Apple Mail and Gmail (5% each).

Contact Software

Contact software assists firms in maintaining names, contact information, and other important information associated with individuals and businesses. 89% of small firms and 81% of solo firms report that contact software is available for use at their firms. The brands noted most often as available at respondents’ firms are: Microsoft Outlook (77%), Time Matters (7%), PCLaw (6%), and InterAction (5%). Contact software can be an invaluable tool in relationship management and day to day efficiency.

Customer Relationship Management

Some of the contact tools offer an option to track and record additional information, and provide a customer relationship solution. 23% of solo attorneys and 26% of small firm attorneys (compared with 17% in 2015, and 14% in 2014 and 2013) report utilizing customer relationship management software. The brands identified most often as available at respondents’ firms are: Microsoft Outlook (55%), InterAction (10%), and Time Matters (9%).

Remote Access

Remote access programs permit you to log onto your computer or server while away from the main device. 81% of small firms utilize remote access, whereas only 55% of solo respondents do. With cloud computing developments, the need for remote access may decrease.

E-fax

Though the fax machine can sometimes seem dated, it remains an important tool in the legal industry; the modern response is the use of e-fax. 55% of solos and 47% of small firm respondents reported using e-fax. Of those who do, the software they use most often is eFax as the market leader at 40%, compared to WinFax, myFax, and ScanSoft all coming in at 10%, and 8% reporting RightFax (compared with 16% in 2015, 15% in 2014, and 22% in 2013). As with all software, it is important to understand your needs and their plans. These software options differ in offering free fax-out options, pay-by-fax, or monthly plans.

Instant Messaging

Instant messaging can be a useful communication tool both within an organization and with potential and existing clients. In this area, attorneys from solo and large firms both came in at 42% with regard to utilization, followed by small firms at 36%. Respondents who indicated what product was available at their firm listed Microsoft Windows Messenger as the most widely available (25%), followed by Google Chat/Hangouts (23%), Outlook Communicator (17%), iChat (13%), Yahoo (7%), Skype and Lync (6% each), and AIM/AOL (5%).

Voice Recognition

The development of data entry into a computing device has progressed dramatically. Key-to-text is no longer a requirement and voice recognition programs are ever improving. 27% of solo and 23% of small firm attorneys report personally using voice recognition software for law-related tasks. The tools used most often include Dragon Dictation (83%) by a landslide (there is also a legal version available), followed by MacSpeech (7%), and Cisco (6%). This is an area of opportunity where lawyers should begin experimenting, as voice recognition solutions may replace some traditional team members.

Office Software


Word Processing

Nearly all respondents (99%) reported their firms having word processing software available for use, and 92% reported personally using the software for law-related tasks. 94% of solo practitioners reported personally using word processing software for law-related tasks. The brand names listed most often as available at respondents’ firms were: Microsoft Word (97%), Corel WordPerfect (17%), and Apple Pages (4%). There are separate redlining software options, but the one used most often by respondents was Microsoft Word at 79%. Word processing tools have advanced drastically from the digital typewriter and it is undoubtedly the most important and necessary software for a practicing attorney.

Calendaring

Maintaining dates and deadlines is vital to the success of a law practice. It is not merely rescheduling a conference, it is meeting deadlines, attending court dates, and obeying statutes of limitations. 92% of small firm and 85% of solo attorneys use calendaring software. The programs implemented most often were: Microsoft Outlook (76%), Google Calendar (7%), Time Matters (6%), and Amicus (5%).

Spreadsheets and Presentations

The additional tools one should find in an office package include spreadsheets- and presentation-based software. Spreadsheets can be used for tasks like analyzing and organizing data, generating graphs, and assisting in data management. 91% of small firm attorneys and 88% of solo attorneys utilize spreadsheets.

Presentation software can be used in person or virtually to share information in a persuasive and organized manner. 48% of small firms and 41% of solo attorneys report using presentation software. The brand names listed most often by respondents as available at their firms were: Microsoft PowerPoint (96%), Apple Keynote/iWork (7%), and TrialDirector and Corel Presentations (6% each).

Document Software

PDF and Scanning Software

Some scanners come with their own software, but there are also a number of independent scanner software options on the market. An incredibly high number of small firm and solo respondents reported having image scanning software for law-related purposes (96% and 93% respectively). However, only 77% of small firm attorneys and 75% of solo attorney reported using scanning software. The image scanning software brand names listed most often as available at respondents’ firms were: Adobe Acrobat (85%), ScanSoft (14%), and PaperPort (8%).

PDF programs are often more powerful than we realize until we try to search for a word, combine multiple documents, or extract a section from an existing PDF with only a reader tool. 90% of small firm and 89% of solo attorneys use PDF software. The brand names listed most often by respondents as available at their firms were: Adobe (88%), and Corel WordPerfect and Nuance PDF Creator (10% each).

Document/Record Management

Maintaining digital records can decrease disorder. Respondents from large firms reported the highest personal usage of document/records management software (80%), and solo practitioners reported the lowest use (30%). Personal usage of document/records management software for small firms was 45%. The brand names listed most often as available at respondents’ firms were iManage (22%), Worldox (13%), Time Matters (12%), and Hummingbird DocsOpen/Open Text eDocs (7%).

Document Assembly

Less than one-half of all respondents (43% of solos and 42% of small firms) reported that document assembly software was available at their firms. The leading brand names were HotDocs (25%, compared with 32% in 2015, and 40% in 2014 and 2013), ProDoc and Microsoft Word (10% each), and ProLaw (9%). Document assembly technology can be game-changing. These tools can assist in minimizing mistakes and multiplying efficiencies, and you no longer need to have coding experience or spend excessive amounts on the software.

Metadata Removal

Metadata removal is a tool that scrubs documents for potential privacy-compromising information before a file is replicated or shared with others. 34% of small firm and 33% of solo respondents reported using metadata software. A big issue here is attorneys being unfamiliar with the existence of metadata. Often, if one does not scrub a document, the recipient may be able to access former drafts. The programs used most commonly by practitioners were: Adobe Acrobat (62%), Workshare Protect (14%), Microsoft Word (9%), Payne’s Metadata Assistant (8%), and iScrub (7%).

Financial Software


Accounting

84% of small firm and 71% of solo firms reported having accounting software. Solo attorneys (at 58%) were the most likely to report usage. The tools used most frequently were: QuickBooks (43%), Quicken (13%), Timeslips (12%), and Tabs 3 and Elite (9% each).

Time and Billing

With regard to software solely used for billing, 44% of small firm attorneys and 39% of solo attorneys reported utilizing it for law-related tasks. 68% small firm attorneys and 58% of solo attorneys reported using combination time and billing software. The brand names listed most often as available at respondents’ firms were: Timeslips (17%), QuickBooks (15%), Tabs 3 (10%), and PCLaw and Elite (7% each).

Project Management

Project management programs can keep teams and individuals on track. 20% of solo and 21% of small firms reported using project management software. The top products included Microsoft Project (47%), Casemap (29%), and Mindmap (7%).

There is also legal-specific project management software, often referred to as practice or case management software. Some of these solutions are practice area-specific, while others do not make such a distinction. Overall, only 46% (only up 1% since last year) of respondents reported the availability of case management software at their firms. Solos were the least likely (at 32%) to utilize case management software. However, in medium firms (from 32% to 62%) and large firms (from 21% to 51%) there was a significant spike in the utilization of case management software from 2015 to 2016. There are numerous practice management solutions developed specifically for solo and small firms that can allow one to maintain a competitive edge as larger firms implement these valuable technologies.

With regard to the software brands, those listed most often by respondents as available at their firms were: Microsoft Outlook (52%), Time Matters (11%), Amicus (9%), and CaseMap (6%). With regard to practice-specific case management software, 25% of small firms and 13% of solos reported utilizing these tools. These programs also include conflict check options, though 37% of small firms and 30% of solos still report having conflict software. The brand names provided most often by respondents as available at their firms were: Westlaw (46%), BNA (17%), CCH (13%), and Lexis Practice Advisor (12%).

Cloud Computing

Respondents were asked if they ever used a web-based software, often referred to as cloud computing or Software as a Service (SaaS) (e.g., Rocket Matter, Clio, Google Apps, Mozy), for law-related tasks. Only 38% of all respondents answered affirmatively, the majority being from solo and small firms (42% and 46% respectively).

Respondents were asked how they evaluated their potential cloud/SaaS services and what precautions and security measures they took. 38% reported reviewing privacy policies, 36% reported making regular local backups, 36% reported only using software which features SSL/encryption, 30% used the software for non-confidential purposes only, 29% reviewed the terms of service, 29% reviewed the ethical rules and/or opinions, 26% sought peer advice, 25% evaluated the history of the vendor company, 13% used vendor-drafted service level agreements, 8% negotiated confidentiality agreements, 8% used security add-ons, 2% negotiated service level agreements, and 12% did nothing. This list is by no means exhaustive, but is illustrative of many options that should be considered when selecting and utilizing cloud computing services.

Many attorneys have expressed concerns over implementing cloud solutions, but there are also many significant benefits offered by the technology. For an in-depth examination of cloud computing data from the 2016 Legal Technology Survey Report, see the Cloud Computing TECHREPORT authored by Dennis Kennedy.

IT Staffing

Once selected and obtained, the utilization of technology is not without its complications. Unfortunately, solo and small firms are not often able to justify the overhead of IT employees. 79% of solos and 53% of small firms report not having any technical support staff in the office. Most of the service providers are keenly aware of this challenge, so besides designing their products to be as user-friendly as possible, they have excellent trainings and customer support. Don’t let an existing lack of ability, or capacity to hire an expert, prevent you from updating your technology tools.

Conclusion

The feasibility of building technology into your solo and small firm operations requires thoughtful inquiry into the available options, associated costs and benefits (both in time and money), and requisite skills. Having an understanding of the tools being used by colleagues cannot only assist in these decisions, but can also provide a baseline in determining what establishes reasonable competency. It is undeniable that technology plays an ever increasing role in our profession and that gaining and maintaining an aptitude early on is necessary.

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