How tech is modernising the transaction process

In CLOC’s 2019 State of the Indus­try Report, bet­ter project man­age­ment was sec­ond only to alter­na­tive pric­ing mod­els as the inno­va­tion most need­ed from law firms.

Com­pa­nies expect their firms to offer the most effi­cient and cost-effec­tive ser­vice pos­si­ble. With the pace of tech­no­log­i­cal change con­tin­u­ing to accel­er­ate, there is no rea­son to sus­pect these expec­ta­tions will be low­ered any time soon.

But for some rea­son, most com­pa­nies con­tin­ue to tol­er­ate sub-opti­mal lev­els of ser­vice when it comes to cor­po­rate deals, such as merg­ers, acqui­si­tions and man­age­ment buy-outs, because law firms are choos­ing to stick with tra­di­tion­al meth­ods of man­ag­ing the process.

Despite the rel­a­tive­ly slow adop­tion of tech­nol­o­gy with­in law firms, often attrib­uted to sev­er­al fac­tors includ­ing the bill­able hour and the nat­ur­al incli­na­tion to defer to prece­dent, lead­ing firms have recog­nised this is an area which requires evo­lu­tion.

Increased promi­nence of legal project man­agers and focus on process re-engi­neer­ing are both expos­ing the need for tools, which not only enable bet­ter ser­vice deliv­ery, but also allow lawyers to focus on their core com­pe­ten­cies. When most admin­is­tra­tive tasks are made eas­i­er thanks to tech­nol­o­gy, lawyers can pro­vide their clients with top-notch legal advice.

I can con­sis­tent­ly close deals faster and more effi­cient­ly, which makes my clients very hap­py

As a result, one of the fastest grow­ing tech­nolo­gies with­in firms is soft­ware that sup­ports the trans­ac­tion man­age­ment process. In much the same way that project man­age­ment tools have been utilised in so many oth­er areas of cor­po­rate life, where pre­dictable time­lines, vis­i­bil­i­ty and clear account­abil­i­ty and check­lists are basic com­po­nents of suc­cess­ful deliv­ery, firms are recog­nis­ing both the end-result and the client expe­ri­ence are con­sid­er­ably improved by using tech­nol­o­gy to assist.

Trans­ac­tion man­age­ment soft­ware is par­tic­u­lar­ly valu­able dur­ing the sig­na­ture and clos­ing phase. Delays in clos­ing deals are not uncom­mon. In some cas­es, they are unavoid­able. But in many instances, they occur as a result of poor­ly man­aged process­es, and issues sur­face in the lat­er stages, forc­ing a scram­ble on all sides to avoid the sub­se­quent recal­cu­la­tions and recom­mu­ni­ca­tion which a delay caus­es.

As deals approach this clos­ing stage, using tech­nol­o­gy to cre­ate exe­cu­tion copies and final deal records can cut prepa­ra­tion times in half. The most sub­stan­tial time-sav­ing is when firms use dig­i­tal plat­forms to cre­ate clos­ing binders, which can oth­er­wise take many weeks and months.

“There is a lot of run­ning around in the lat­ter end of the deal, which is not actu­al­ly nego­ti­at­ing any­thing, it’s pure­ly the paper trail,” explains Paula Mac­na­ma­ra, man­ag­ing asso­ciate at Sim­mons & Sim­mons. “With a sys­tem like this, it makes the process a lot more stream­lined.”

Fur­ther­more, research con­duct­ed by Dox­ly, a trans­ac­tion man­age­ment plat­form recent­ly acquired by Lit­era, found that the time spent on the entire sig­na­ture process could be reduced by up to 75 per cent com­pared to tra­di­tion­al meth­ods.

“I can rou­tine­ly com­plete the sig­na­ture page and sign­ing process for cer­tain clos­ings in 24 to 48 hours,” says Eric Good­man, part­ner at Ice Miller. “Before, these deals would rou­tine­ly take one to two weeks just to get all sig­na­ture pages back from the var­i­ous par­ties. I can con­sis­tent­ly close deals faster and more effi­cient­ly, which makes my clients very hap­py.”

Ulti­mate­ly, firms embrac­ing these tech­nolo­gies are win­ning busi­ness over those that don’t, because it also gives in-house teams greater vis­i­bil­i­ty into the progress of trans­ac­tions, with­out the need to spend hours chas­ing their law firm for updates. Like oth­er pro­fes­sion­al ser­vices before them, the legal indus­try is respond­ing to its clients’ need for mod­erni­sa­tion of both its process­es and ser­vice mod­els.

Litera’s soft­ware is in use in more than 90 per cent of the world’s largest law firms and is a lead­ing provider of trans­ac­tion man­age­ment solu­tions to the indus­try, in par­tic­u­lar with­in the teams work­ing on merg­ers and acqui­si­tions, ven­ture cap­i­tal, pri­vate equi­ty, real estate, and across the broad­er areas of bank­ing and finance. The tech­nol­o­gy brings con­trol, peace of mind and speed to legal trans­ac­tions, help­ing deals close on time.

For more infor­ma­tion please vis­it www.litera.com