Law firms are under pressure to improve their work efficiency. They need to increase their percentage of billable work by reducing low-value, or unbillable work. This is essential to a law firm’s success today.
According to a 2017 McKinsey study, 23% of lawyers’ tasks can be automated. Plus, the 2018 Clio Legal Trends Report indicated that only 81% of hours billed by lawyers are invoiced and that only 85% of those invoices are actually paid. Realization rates will continue to drop if law firms don’t stop billing clients for repetitive manual tasks.
But with the availability of software designed to increase efficiency, this does not need to be the case. Although many legal technologies have fallen short of expectations after significant investment and effort, why is legal transaction management (LTM) worth considering?
What is LTM?
LTM is using software to enhance human efforts. By providing a structured workflow, it allows transactional lawyers to automate routine error-prone manual tasks. Legal transactions are complicated, often involving hundreds of documents to effect the legally binding transfer of ownership for one company. As more shareholders, subsidiaries, or leases are involved, these documents grow ever more extensive and detailed. And each one needs to be negotiated and signed. On top of keeping track of all these ever-expanding documents, deal timelines continue to shrink, often to as short as a single week.
This is where LTM comes in. It can do a couple of things:
- LTM keeps track of everything that makes up the deal. It tracks every document, every schedule, and every signature in a single centralized place. Consolidating everything in the deal ensures important changes aren’t missed and prevents critical errors—a massive challenge in high-value legal . This also provides transparency and progress on deals to all parties involved.
- LTM can automate. Getting 200 documents signed by the same five people takes a lot of organization and time. When LTM completes this process, lawyers can focus more on that complex web of documents and provide better advice—which means happier clients. After the deal is closed, lawyers using LTM can create closing books in just a few clicks. That means clients get their books the day after closing, making them even happier.
How does LTM work?
Although LTM tools can vary, most revolve around a few key workflows, including:
Importing your closing checklist and documents. LTM automatically associates your file uploads with the correct closing items in minutes, and many integrate with your document management system (DMS), making syncing even easier.
Identifying who signs what and tracking signature pages. Several LTM tools offer a signature page generation capability. Generating signature pages facilitates making last-minute changes to signatory details like exact legal names. When changes like these occur, tools with this feature regenerate affected signature pages for signing in a matter of minutes.
Creating signing packages. This is one of the biggest time-saving and error-saving functions, eliminating all the manual work involved in compiling these pages into a PDF package and getting them signed. With LTM, they only take a few clicks to prepare.
While it is evident the features of LTM tools are developed to solve very specific pains when it comes to closing transactions, law firms are embracing LTM because it also meets wider business outcomes. The ability to collaborate, reduce unnecessary risk, increase deal profitability, and provide improved client service delivery means law firms can remain competitive. To learn more about what LTM can do, download our “Closing the Deal” report.