When Richard Susskind talks about the “commoditization” of the practice of law, one of the things he means involves breaking up the component parts of a given engagement (creating an estate planning strategy, or a real estate transaction) into its component parts, each of which is automated through some sort of “expert system.”
In this scenario, the client answers a series of questions (asked by a computer instead of a lawyer in person), and at the end of the interview one or more documents are generated: engagement agreements, wills, leases, tax documents, etc. Other parts of the engagement might be farmed out to specialized paralegal services (preparing the documents for a corporate filing, for example). Thus while a great deal of time, development effort and expertise goes into these systems, they make it easy for law firms and users to accomplish a single task at a time very efficiently. An overall engagement is comprised of “x” tasks.
When we turn to computer software and hardware what is generally meant by saying that something has been “commoditized” – computers or cell phones, for example? Different models are essentially interchangeable and can be freely substituted for each other. Despite the fact that one model or brand might have a temporary advantage due to more advanced features, other brands will soon catch up. Witness the iPhone’s touch screen which is now being matched more or less successfully by other brands.
Legal internet research has essentially become commoditized. Lexis and West offer very similar services: one option might temporarily be better than a similar option offered by the other company, pricing might be slightly different from time to time (“special offers” etc.), but there is no difficulty or penalty in switching from one offering to another once your contract is up. Both West and Lexis offer automated court forms for the major states. Free services, such as those offered by state bar associations tend to be less feature-rich, but for many users do the job, thus confirming Susskind’s thesis that the price of commodities will tend toward zero (actually, he is not quite correct about that: the price of commodities will tend toward the cost of producing them).
Software becomes commoditized when you can use any one of a number of programs to do the same task – word processing or email for example. However, and this is the key difference from “expert systems,” many of these programs can be termed “shells” – they have no built-in expert systems but are open to be configured to do just about anything or to have “plug-in” utilities added to them. To the extent that expert systems are needed – for example to do Table of Authorities or Tables of Contents, or to strip metadata from documents in Word – people frequently resort to dedicated utilities which are designed to do only one thing, but to do it exceptionally well. They may build in templates to help automate the production of various types of documents, but even these templates will need to be customized to fit your specific needs.
Traditionally, one of the tasks of consultants has been to apply their experience and expertise to particular features of these programs by developing templates, document assembly and other routines that let a firm automate the production of various types of documents. This corresponds more or less to somewhere between Susskind’s categories of “systematized” and “packaged.”
Enter Practice Management programs such as Time Matters, Amicus or Practice Master. These programs all started out doing a few things very well. As computers grew more powerful and as the programs matured, they started adding features so that they could claim “one size fits all” and win the battle for the desktop (which program do you have open most on a regular basis). However, as Richard Susskind says, in reference to knowledge management, “one size fits none.”
These programs are shells par excellence. They ship with options for generic types of law, most of which a small firm will not need, in an effort to be all things to all people. Furthermore, unlike expert systems (which are by nature standalone), they exist in a spiderweb of links to and integration with other programs: email, word processing, creating PDF files, merge files and elementary document automation, and so on. This spiderweb of links is one of the primary obstacles to commoditization of software. There are no doubt many individuals and firms (myself included) that would switch to Open Office or Google Apps in a flash except for the fact that they don’t integrate/link with other programs critical to their practice: whether Practice Management, Document Management or whatever.
In order to be used effectively, these programs must be adapted for one or another area of law. So it is not surprising that there exists a huge third-party market to customize – one might say “expertize” them – so that specific pieces of them approximate an “expert system” for one particular feature or type of law, whether it is elderlaw, estate planning, bankruptcy or something else. Initially, and for many small firms, this “expertization” is customized (or in Susskind’s terms, “bespoke”). However, since the demand to customize a program for, say, a real estate firm is the same or very similar for different real estate firms, custom modules have been built that are then resold as separate applications or add-ons. Some of these add-on programs can cost much more than the originally software. One is sold on a subscription basis for $9,000 per year!
We therefore have large practice management programs that are “shells” populated by “expert” modules. Think of it as an iPhone or a browser such as Firefox with many plug-ins, but applied to practice management.
LexisNexis and other companies seem to be trying to “commoditize” entire practice management systems. This is accomplished in part by trying to integrate programs such as Time Matters into an automated forms package and other services. Lexis rebaptises this “Lexis Nexis Total Practice Advantage” (and charges a premium for it). At the standalone level, Lexis is offering “startup” options and various “training” modules to get people “up and running” without the need for customization (i.e., making the program into one or more “expert systems.”). That is, an attempt to make these offerings more like the “commodities” (books and research tools) they are accustomed to selling.
Despite claims of a single unified program, however, structurally, we are left with a “shell” (the base Practice Management program) with various “expert” plug-ins, whether they are custom designed or sold as packages. Trying to further “commoditize” the shell programs will fail for several reasons. First, the programs themselves are too big and complex. To teach users the “bare bones” is essentially to render these powerful programs little more than a glorified rolodex. In terms of efficiency, this is not productive.
Secondly, to the extent these programs are “simplified,” they tend to strip away the potential to become or use “plug in” expert systems, or at least make it a lot more difficult.
Lastly, the major players (Lexis, West), are committed to keeping their programs proprietary. You will not see (at least in the relatively near future) the ability to plug West’s forms packages into Time Matters or vice-versa. Over time, this proprietary, anti-commodity, behavior may be reduced or reversed. After all, for years Microsoft protected its proprietary format ferociously and forced everyone else to write to its standard. Only recently has it taken the first (and still incomplete) steps toward complying with open standards (which is a further step toward commoditization).
So if we think about the directions practice management software could go, we are left with two main theses.
First, the attempt to simplify programs to a “one size fits all” model is a mistake. The attempt to simplify (i.e., reduce) the underlying functionality will impact the ability to develop expert modules for these programs.
Second, these programs should be moving in the direction of facilitating integration with “plug-in” expert modules, either by creating an API or simply exposing parts of the database so that it can be accessed directly. If Susskind is correct about advanced systems and commoditization, then the future lies not with simplification, but with greater complexity. Programs will become assemblages of specific routines where surface simplicity and ease of use is underlain by increased complexity and expertise. They will take the form of expert modules being added to practice management and similar programs.