Discusses his efforts in introducing technology to his legal team, the challenges of selling the value of legal tech investment to the businesses, and the ethical considerations that come into play when adopting new technology.
I think technology in the in-house department is
not an option anymore. Because, as you know,
all companies are cost and profit-driven. So,
at some point, the question will be on the table:
'What is cheaper for me' or 'What is more efficient
for me?' To have an in-house department, or just
to go find a law firm and try to push down the
prices? So, I think the technology will give us, as in
house lawyers, more possibilities in order to argue
that it's a good idea to have in-house lawyers. I
think every company must start to interact with
these new technologies to try to develop an idea
or a practice to use that. In my case, of course,
I'm trying to bring these new technologies and
ideas and be open to the market but, otherwise,
I try to bring on board young lawyers with these
new ideas, who of course can contribute to the
development of the legal department.
We deal a lot with in-house software that
manages the areas of litigation, arbitration and
conflict management. We focus on these areas
because of the amount of litigation that we have.
For example, in 2009 there was a drop down
of oil prices and, as we are a construction and
maintenance company, we had to let go of many
people because some of our contracts were
shut down. That brought us over 100 cases of
litigation. So, taking that into account, and also
that we have almost 1,200 active suppliers at the
moment, we need to find a way to manage this
and try to be more strategic.
We have been working in this project almost two
years, I believe. At the beginning, there was a lot
of data mining. We tried to obtain as much as data
as possible from all our contracts and litigation:
the value of the litigation, the name of the parties
to the contract, the duration of the contract, the
purpose, scope and everything else. We did all of
this data mining and uploaded it into the software.
At the moment, the software gives me an idea of
when, according to the data, is the most proper
moment for me to settle. So, this technology
gives me all the tools to make a decision and, of
course, to manage this big amount of issues.
Before five years, the only contact with
technology from our legal department was
the cloud and the files' source. We PDF'd and
scanned all the documents and uploaded them,
but there was no 'correct' way to manage them.
In case you wanted to search for a specific file,
there was no way to do it. You needed to spend
five or ten minutes to find it - if you found it.
The first challenge was to try to obtain budget.
It's not common for in-house - maybe for firms
it's trendier - but for in house, it's quite new to
have this managed software, and it's newer that
you want to create your own software. So, trying
to sell the idea to the CEO in order for them to
see the benefits that it eventually will bring to
the company was really hard. But I can say for
sure: today, they can see those benefits and the
company is willing to invest more in software
within the legal department. Our software was
obtained through our in-house IT department,
and we spent almost two years working closely
between them and our legal department to
create this software.
In terms of ethical issues, I'm not sure if you're
aware of this - in Mexico, when you have a
labour case, mainly it's because the former
employee feels that he was entitled to receive
a bigger compensation. Some cases, they are
right; some cases, they are wrong. But that's
purely mathematics. Even if they are right or
wrong, my duty as a head of legal is to see the
best interests of the company. So, there are
some cases that they are right in asking for these
extra compensations. But the software might
recommend that I can settle with them for a
lower figure that they are entitled to. So, that is
the ethical issue. Because in some part, I want
to, and it's my duty with the company, and on
the other hand of course, I want to be fair with
the former employees. So, that is an ethical issue
that I am seeing as a result of this software.
Right now, we are planning for next year
to add a new part of the software for
insurance management, and also for customs
management. For customs, we often import the
vessels, and our import permit might be valid for
six months, seven months, one year or ten years.
You have to renew that permit or you will be
fined. So, we are thinking to add this part to the
software, in order to have a reminder previous to
the due date in order for us to renew the permit.
Regarding the insurance, it's the same. We
cannot have our vessels or operations without
insurance, so the idea is to create these new
parts of the software to manage that.
Both external lawyers and in-house teams have
to adapt to new processes. But, at some point,
we ask for external lawyers to fit our software:
we ask them to do it, but we understand that we
are not their only client. So it takes time for them
to fit the software, and if the software is not
with the proper data, we cannot take the proper
decision. So it can be difficult - it's gymnastics.
At some point, we have to work on that, and
eventually it will be really natural.
Historically, lawyers are not used to using
technology in our profession, and the definition
of a lawyer has been to do things the oldfashioned
way - with paper, or e-mail. Before
we took the decision to develop the software
in house, we looked at many options within
the market, and we noticed that most of the
software was being developed in order to
manage, first of all, the billing hours for external
lawyers and, secondly, to manage contract
drafting - and that's it.
New generations of young lawyers have a
different set-up, a different mindset. I think
lawyering is a little bit behind if you compare
it with other professions, such as marketing. I
think these new generations will push harder to
improve new technologies in the law practice.