In-house legal departments often face the dilemma of whether to build or buy technology solutions, and this article explores the arguments for both sides.
In the context of legal technology solutions, “build” refers to developing a custom solution in-house using existing software, while “buy” involves purchasing a software or service from a vendor.
The Argument For “Build”
Legal departments will sometimes have conversations such as these, that will lead them down the path of building their own solution:
- “Oh, our IT team could build it”
- “We’ll try to get the functionality using a product we already have”
- “We’ll see if we can do it ourselves first”
The benefits of building something yourself is that any recurring subscriptions costs will be low or non-existent as legal departments will typically look to build a solution using enterprise software such as Microsoft Office, ServiceNow or Jira. This option is usually also a low friction approach as your IT and finance teams will be supportive of a low cost, prudent tactic.
When building a solution, someone in the legal team will build a solution using these tools or work with their IT colleagues to build something for them. The legal team can then test and implement it.
Another valuable benefit of building in-house, is that the solution should easily integrate with existing systems, assuming it is built on the same enterprise software foundation.
The Argument Against “Build”
Ultimately, building a solution using enterprise tools comes with many challenges. These are a few of the most common ones to consider:
- Whilst there are no subscription costs, the internal resource costs can be significant, and the opportunity cost must be considered e.g. what would that person be doing if they weren’t building this solution.
- Developing a solution takes time, so be prepared to have a lengthy period of development and testing prior to the implementation.
- Once a solution is built, it must be maintained. The IT person or in-house lawyer that built it, or hacked it together on Microsoft tools, will leave. Or move on to another project. Who will maintain it?
- If it can be maintained, can it be evolved or scaled? What happens when the legal team grows, re-structures, or expands into new jurisdictions? There is a risk that the solution can go stale which can have an impact on adoption and usage.
- If something breaks, will you be up at 2am to solve it?
If your legal department decides to go down the road of building your own solution, be sure to have strategies in place to manage these issues to ensure that the project is successful.
The Arguments For “Buy”
There are many reasons that in-house legal departments are seeking out legal technology solutions that are available as Software as a Service (SaaS). These are some of the core benefits of buying a legal technology solution off the shelf:
- The vendor is responsible for maintaining the software
- It is easily scalable with planned enhancements and features to meet evolving needs
- When something goes wrong you contact the vendor for support
- Vendors will be the ones awake at 2am to ensure the software works seamlessly for their customers
- You can rely on their security standards such as ISO 27001:2023
- Implementation can be quick with testing limited to “user acceptance testing” or UAT e.g. does it do what it is supposed to do
- Plug and play integrations are often available so that you can use the tools that are important to you
When it comes to buying technology, look for a solution that can be configured to your unique needs and requirements. Configuration means that the software can be readily adapted to different use-case or workflows – now and into the future. Avoid customisation of software or custom integrations, as these will often involve software developers and take you straight into the “build” territory that you are seeking to avoid.
The Arguments Against “Buy”
It is important to recognise that buying software does have some challenges to navigate. These are the main ones:
- Internal resources are required for the buying process – identifying requirements, matching these to vendors, booking demonstrations and vetting security systems
- There are upfront costs for implementation and then on-going costs for subscriptions and licence fees
- Introducing a third-party vendor often means navigating security protocols, contracting and other internal processes
In comparison to the “build” approach, “buying” does involve additional internal dynamics, requires a budget allocation and can generate friction. However, these pain points are short-term, and when managed well, should deliver a better result in the longer term.
Or “Build” And Then “Buy”
For some legal departments, it isn’t a case of choosing one strategy over the other, but instead doing one first, while planning for the other. In practical terms, this can involve building a solution, or part of a solution as a proof of concept (POC). This approach can refine the team’s requirements and provide an excellent proof point for your business case. One example is using Microsoft to build basic intake forms. Through the process of building and testing, the intake forms and questions can be refined. Once the legal team is ready to buy and implement a matter management solution, the implementation can be quick and seamless as a lot of the thinking has already been done.
Developing A Business Case
With costs and efficiency under the microscope at most organisations, it is now more important than ever to develop a compelling business case, regardless of whether you want to “build” and/or “buy” solutions for your legal department. To prepare a good business case, dive deeper into the cost implications of the different approaches, analyse factors such as initial investment, ongoing maintenance and support costs, scalability, and potential return on investment (ROI) over time.
Legal software vendors can also provide handy tools such as a Savings Calculator, how to calculate return on investment, and best practice guides for crafting that essential business case.
Conclusion
In-house legal departments face the decision of whether to “build” or “buy” technology solutions. Building in-house can leverage existing enterprise software like Microsoft Office, offering lower costs and easier integration but requires significant internal resources, long development times, and ongoing maintenance. Conversely, buying software from a vendor provides benefits like minimal maintenance, scalability, and rapid implementation with robust support and security, but involves higher upfront and ongoing costs and navigating internal protocols. Alternatively, a combined approach, starting with a build as a proof of concept (POC) to refine requirements, can strengthen the business case for a purchased solution.
For all options, key considerations include assessing specific needs, comparing total ownership costs, evaluating scalability and maintenance, and vetting vendors for configurable solutions. Then, preparing a detailed business case that highlights cost implications, benefits, and potential ROI is crucial.
Finally, managing internal dynamics is essential—align IT and legal teams and involve stakeholders early to minimise friction. By carefully weighing the pros and cons of each approach, legal departments can make informed decisions that align with their needs and resources.
This article was originally published on our sister site lawcadia.com.
