Ari Kaplan recently spoke with Early Stephens, the CEO of Actionstep, a practice management software developer that serves law firms worldwide, about its newly released survey, 2023 Midsize Law Firm Priorities Report, which focuses on the most prominent priorities and trends impacting legal teams.
Ari Kaplan: Tell us about your background in your role at Actionstep.
Early Stephens: I have a marketing and computer science background and spent most of my career running various components of software companies. I began my career as an engineer or a programmer and have served as the chief technology officer of a publicly traded software company. Eventually, I moved to product management, marketing and sales. Most recently, I was the CEO of an enterprise data analytics company, where we helped Fortune 100 companies with their digital transformation journey before the company was acquired. As Actionstep’s CEO, my job is to ensure we have the right people and priorities, as well as a strong financial health profile, so that our customers can continue to rely on us to power their firms.
Ari Kaplan: Why has legal practice management software become so important to running a modern law firm?
Early Stephens: The No. 1 reason is that their clients expect it. You order groceries from your phone and you pay your bills online, so you expect that same level of sophistication everywhere. It is a competitive market in which firms are competing for the same clients, and they need to stand out. They have to interact and engage with their clients where their clients operate, so everything needs to be connected and share the same workflow. As more professionals work remotely, firms ultimately need to have a centralized hub for their data.
Ari Kaplan: What distinguishes Actionstep from other platforms on the market?
Early Stephens: Actionstep is built for midsize firms and is very configurable. Midmarket legal practices evolve and grow by adding practice areas and groups, so they need software that can flex to support not only what they do today but to address their needs tomorrow. Our No. 1 differentiator is our Actionstep workflow, which allows users to tailor how they handle their cases and workflows. In fact, many of our new customers are typically firms that are trying to grow and progress.
Ari Kaplan: Why did Actionstep commission its new 2023 Midsize Law Firm Priorities Report?
Early Stephens: There is not enough data focused on that market, so we partnered [with] a research firm in the U.S. and sought answers to many common questions that midsize firms share. We wanted to capture hard data on trends and challenges that impact most firms that we serve.
Ari Kaplan: What priorities and trends are most prominent today for the law firms you studied?
Early Stephens: More than half of the participants cited identifying new revenue opportunities as their top business priority. In a tie for second place were managing the cost of doing business and recruiting and retaining talent, which are essential for growth. Also, recruiting and retention relate to employees who increasingly need to manage multiple roles and various responsibilities while balancing billable requirements with administrative tasks. And as client service expectations change and become more elevated, it is accelerating the digital transformation that many firms are experiencing. After all, modernization is as much a change of people as it is about technology. Interestingly, our research revealed that higher self-reported stress correlated with fewer remote work options in a firm, while those with flexible working conditions reported lower levels of stress. In terms of technology investment priorities, document automation and management and legal process automation were the leading initiatives. If you can transform enough manual work, you can enhance client service.
Ari Kaplan: Did any of the results surprise you?
Early Stephens: There was a correlation between participants who reported that they spend too much time on nonbillable work and those who report stress. One thing I found interesting is that more than half of the respondents stated that they thought technology was either slightly important or not at all important in attracting and retaining, which is likely to shift increasingly given the technology expectations of younger professionals.
Ari Kaplan: Has your leadership style changed in your role at Actionstep as compared to working in prior industries?
Early Stephens: I have adapted to role by balancing a fast-growing company in an industry that’s undergoing a lot of change while maintaining a strong customer focus. In some of my prior roles, it has been the opposite, where everyone is super-customer-centric and not as interested in growth, but there is just so much demand right now around modernization in legal. I am, therefore, focused on aligning our team on implementing processes and protocols to ensure that we are serving our customers and staff as we grow.
Ari Kaplan: How do you see legal practice management evolving?
Early Stephens: There are several macro trends, such as incorporating AI or ChatGPT into practice management, but it is too early to make a prediction on that subject. Ultimately, tools that free professionals to work at [a] higher level are on the horizon. What we are hearing and seeing now is platform isolation and our data supports the growing frustration among professionals who need to enter data in multiple disconnected systems. Law firms tend to use a fragmented set of tools and consolidating them into fewer tools is a key trend. We see platforms evolving into more of an ecosystem approach, where work is done in one system, but users can interact and share it with other complementary tools. We are moving toward a single source of truth. Given the current cost pressures that law firms are addressing, we see a bigger focus on generating more value from an existing portfolio of tools, rather than buying more technology. In response to this movement, we launched Actionstep Academy, which is library of content, including videos and self-help resources to support law firms in their modernization journeys.
Editor’s Note: Actionstep is the sponsor of Ari Kaplan Advisors’ The Virtual Lunch, which is unrelated to the Reinventing Professionals podcast but is hosted by Ari Kaplan.
Listen to the complete interview at Reinventing Professionals.
Ari Kaplan regularly interviews leaders in the legal industry and in the broader professional services community to share perspective, highlight transformative change and introduce new technology at his blog and on iTunes.
This column reflects the opinions of the author and not necessarily the views of the ABA Journal—or the American Bar Association.