The Association of Corporate Counsel (ACC), in partnership with Exterro, the exclusive ACC Alliance Partner for e-discovery, data privacy and cybersecurity compliance, today released the "2023 Legal Technology Report for In-house Professionals." This innovative report provides key findings on legal technology adoption, sophistication of legal processes, and top challenges being faced.

Seventy-eight percent of respondents reported that legal technology is now a “must-have” for legal departments, a 15 percent increase in just two years. Thirty-eight percent reported that their organizations plan to purchase or upgrade legal software over the next year.

“Legal technology adoption continues a dramatic rise across the board and this report provides important details of where it’s been and where it’s going from a variety of perspectives,” said Blake Garcia, ACC’s senior director of business intelligence. “Despite clear benefits, there remains a great deal of variation when it comes to company size and organizational buy-in of how much is being invested in legal technology. We thank Exterro for their continued partnership on this project to provide legal departments key insights as they continue to assess and make decisions around legal technology.”

“Macro trends, including the constant introduction of new laws and regulations, increased scrutiny on protecting personally sensitive data, the constant threat of cyber intrusions or attacks, and unrelenting pressure to do more with less have put tremendous pressure on internal legal departments, which requires a thoughtful approach to optimizing people, processes and technology” commented Bobby Balachandran, Founder and CEO, Exterro. “We are pleased to be able to collaborate with the ACC to release this valuable guide for managing the complex interactions between privacy, legal operations, digital investigations, compliance and cybersecurity response.”

Additional key findings include

• More companies are showing greater structure and sophistication in their legal processes. Legal processes can range from unsophisticated and ad hoc with no management or budget (level one) to highly sophisticated and optimized with significant budget, resources, and buy-in (level five). Compared to 2021, more companies are now at a level three or four, having more structured and well-defined legal processes with dedicated support, budget, and sponsorship.
• Legal technology is most needed in certain areas. In addition to looking to leverage legal software more effectively in handling contracts, 41 percent of in-house teams wanted to use technology more effectively in privacy and compliance matters, and 30 percent said that their focus is on litigation.
• Departments with more sophisticated legal processes invest more in legal technology. Thirty-nine percent of legal departments said they plan on buying or upgrading legal software over the coming year, but this likelihood varies dramatically depending on the department’s current level of sophistication.
• Top challenge: software interoperability. While legal teams face numerous pain points when using legal technology, the top pain point identified by 62% percent of respondents is the lack of interconnectivity across their various software applications. Additionally, 43% of respondents felt that a comprehensive software platform could help resolve the challenges posed by using disparate technology solutions.
• Contract management is the most used legal technology and is considered most effective. Sixty-five percent of companies surveyed are now using contract management technology, up 14 percentage points from 2021, and it is now the most used technology, ahead of legal research tools.

Survey responses were from 252 in-house counsel and legal operations professionals across 22 countries.