Legal innovation is the outcome of a research and development process that uses technology to deliver change in the legal services sector. Such process may involve the creation of new technology or the implementation of existing technology, and is characterised by the aim of developing new legal processes, products or services, or delivering non-trivial improvements to existing ones. This definition is sufficiently broad to encompass a wide range of technological innovation, from low-tech approaches that use widespread technology (such as Microsoft Excel) to create useful tools for lawyers, to high-tech approaches that use cutting-edge technology (such as artificial intelligence) to power contract automation services that could not be envisioned just a decade ago. At the same time, the definition allows us to exclude the routine use of technology as a form of innovation: while use of high-speed internet connections, access to Microsoft 365 apps, or use of video-conferencing technologies (Zoom, Microsoft Teams, Webex, etc.) are all important improvements to the way of working of lawyers, their inclusion in the concept of “innovation” is misleading. To further define legal innovation, in particular with a view to better evaluate the strengths and weaknesses of the Welsh LegalTech ecosystem, we adopt the tetradimensional model proposed by Francis and Bessant 130 . According to this model, innovation spans across four dimensions: 1. product , which concerns the marketing of new products or services; 2. process , which focuses on delivering existing products or services through innovative means; 3. position , which changes the way in which the firm presents its products and services to the customers; 4. paradigm , which highlights a radical shift in the way the firm approaches a given business problem. This representation of innovation appears to apply well to legal innovation driven by technology. Product innovation is easy to identify in the products and services offered by law firms and start-ups, such as client portals, contract review tools, identity verification apps, and many more. Process innovation refers to technologies implemented in the delivery of such products or services, including artificial intelligence, knowledge representation, natural language processing, blockchain, etc. Position innovation arises where law firms change the way they approach existing and potential clients, for example offering free guidance, self-assessment tools, podcasts and educational materials, new forms of communication and engagement, or new ways of paying for and delivering services. Paradigm innovation occurs when a law firm or start-up solves an existing issue in a radically new, technology-driven, way: Farewill, for example, appears to have caused such a paradigm shift in the wills and probate field 131 . In chapter 3, we look at examples of innovation in Welsh law firms using the four dimensions of innovation outlined above, before focusing on start-ups and scale-ups in chapter 4, where we encounter innovation that crosses all four dimensions. 130 J. Tidd and J. Bessant, Managing Innovation: Integrating Technological, Market and Organizational Change (5 th edition, John Wiley 2013) 24, citing D. Francis and J. Bessant, “Targeting innovation and implications for capability development”, (2006) 25 Technovation 171. 131 See https://farewill.com/.
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