SCOTTISH law firm leaders are bracing themselves for the revolutionary impact of technology on the way their businesses operate, with more remote working and different methods of communication expected to have the greatest influence.

In its latest ‘Law Firm Leadership’ report, professional services firm BDO found that 70 per cent of Scottish managers expect technology to change the way their firms operate in the next five years compared with just 40 per cent in the rest of the UK.

In particular, respondents said that technology would not only impact on the way legal advice is delivered but will allow lawyers to communicate with clients in different ways at the same time as facilitating more remote and flexible working.

This is in part being driven by the millennial generation, who are demanding more flexible working arrangements from their employers when they enter the legal workforce. As buyers of legal services as well, though, millennials are also expecting more modern modes of engagement from the law firms they instruct.

“One law firm leader expected younger customers to want to communicate with lawyers using new technologies and apps they use in other areas of their lives,” the report said.

The demand for law firms to make better use of technology has been growing in recent years, with in-house counsel increasingly expecting their legal advisers to find ways of offering them the same level of service for less cost.

This has forced many firms to look at the way they staff the work they do to ensure clients are not being charged a partner rate for reading through documents a trainee would be well placed to review.

Many firms have looked at ways of using technology to aid them in these goals, with firms such as Ashurst and Pinsent Masons developing systems that can standardise processes such as document review, which frees up lawyers to handle the higher stake, and hence higher value, legal advisory work.

“It is now a decade since the start of the global financial crisis, which saw a seismic shift in the relationships between law firms and their clients,” said Martin Gill, lead partner for BDO in Scotland.

“This resulted in a clear shift of power and control towards the client, who themselves were being measured on their control of spend and efficiency.

“Whilst this aspect appears to have settled to a degree, change is a constant and the need to adapt is still an essential element of a managing partner role and function.

“Law firm leaders agree that change is inevitable and that their clients have different expectations about what legal services are provided and how they are delivered.”

BDO’s findings chime with recent research from accountancy giant PwC, which found that due to the impact technology is likely to have on the legal sector firms will have to make a choice between focusing solely on premium work or embracing new business models.

In its 2017 law firm report ‘Time for Change’, which is based on the results of a survey carried out among a range of UK and global law firms, the consultancy business noted that “an increasing number of firms are viewing technology not just as a means to boost efficiency, but also as a way to reimagine how legal services are delivered”.

“Whilst clients are still willing to pay a premium for the best advice, they want to know that their providers are making full use of available technology so that they are not paying for expensive resources to undertake repetitive work manually,” the report added.

PwC said that technology would impact all areas of law firms “from client service delivery to business support and, importantly, staff recruitment and retention”.