IT heads bet cloud computing will save law firms millions

The switch to internet-based computing will ultimately save City law firms millions of pounds, according to a flagship Legal Week research project on
legal technology.

The claim is contained in the 2010 Information Technology Report from Legal Week Intelligence, which canvassed more than 4,000 respondents on the performance of IT at the UK's largest law firms.

A key future trend highlighted by law firm chief information officers (CIOs) is the shift to cloud computing, an internet-based model whereby shared resources and software are provided on demand rather than via centralised hardware.

A number of CIOs believe substantial savings will be realised by law firms that embrace cloud computing, with some citing individual firms could make savings of up to 25%. Currently, many firms spend around 4% of turnover on IT-related matters, with the largest firms spending tens of millions of pounds annually.

Several law firms, including Nabarro and Berwin Leighton Paisner (BLP), have begun experimenting with cloud computing, citing reductions on physical server space, licensing and support costs.

But many IT professionals believe that conservatism and security fears will hold back the shift at City firms with few yet implementing such systems.

Nabarro IT director Andrew Powell said: "It could be the future but as a sector we have a very conservative outlook on confidentiality, and the idea of putting all documents in the cloud is quite frightening to many managing partners."

BLP IT director Janet Day (pictured) commented: "We have seen quite a significant saving based on using cloud technology but this is not a process that happens quickly."

The annual report benchmarks law firms' IT on a range of criteria including mobile technology/homeworking, speed of systems and firm websites.

The top-ranked firms for IT services according to their own staff are BLP, Allen & Overy, Wragge & Co, Linklaters and Olswang. Linklaters was ranked first for mobile/home working. BLP and Wragges were two of the biggest climbers this year, moving from ninth and eleventh place in 2009 to first and third place respectively in 2010.

Wragges head of strategic development Derek Southall said: "One of the main focuses for firms at the moment is productivity improvement and clever use of products to assist this.

"Many legal IT products have now come a long way giving firms much greater flexibility. The emphasis is now on working closer with fee earners and clients to leverage these products rather than having to buy new systems."