Digitalization describes the process of converting a phenomenon from physical to electronic and digital. Among other things, this text will look into the digitalization of the legal industry.

Digitalization describes the process of converting a phenomenon from physical to electronic and digital - meaning transferring it onto a computer. This can be an old image archive being transferred to an electronic database, for example, or the process of a company beginning to conduct parts of its business electronically and digitally - e.g. contracts. That way, digitized information is made durable, machine-readable and last but not least replicable without losing information.

What is digitalization?

Through digitalization, a phenomenon is transformed into numbers (typically 0s and 1s in a computer). You take an otherwise analogue phenomenon and make it electronic on a computer. Digitalization is one of the big buzzwords currently and at times referred to as the fourth industrial revolution.

Both public and private companies all over the world have started opening up to the many benefits of digitalization. Firstly, it streamlines several processes, including data search, communication and workflow, for instance. Secondly, otherwise manual tasks can be automated, saving both time and money. Moreover, digitalization can increase security across a company - both private and financial, by making it easier to know where one’s documents are. Generally speaking, digitalization is a means of creating a streamlined and efficient communication flow.

Digitalization of the legal sector

The legal sector has lagged behind for many years with regard to the digitalization of central processes. This is in part due to the industry being so profitable, that it simply has not been necessary to catch up and also, because industries as important as the legal sector have to be a little more conservative than others. Moreover, many point out, that the legal industry’s partnership model does not call for reforms and investments.

The hype around legal tech has begun to grow noticeably over the last few years. A lot of the talk has revolved around different kinds of artificial intelligence and robot lawyers that can read through millions of case documents within a few minutes and reach unbiased decisions. However, there are also more ground-level digitalization processes taking place in the industry. These include contract management systems like Contractbook Suits, digital marketplaces for lawyers and digital legal archives. Last but not least, there are a number of innovative but not yet fully established digital technologies, especially concerning blockchain and smart contracts.

Opinions vary regarding, what digitalization can mean for the legal industry, going forward. On one hand, there are those who believe technology to be a threat for the legal industry’s core business, because a number of more manual processes are being automated and because new digital players are claiming market shares. On the other hand, people argue that digitalization supplements the legal industry in its current state and makes it more efficient.

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