The Ins and Outs of Long-Term Fixed Legal Software Contracts

Technology is not just an enabler but a critical component of a law firm’s operation. Legal software solutions provide law firms with extensive functionalities covering case management, billing, client intake and onboarding, document management, and more. However, when committing to these solutions, many firms opt for long-term fixed contracts to secure price stability and guarantee service continuity. While beneficial, these contracts require careful consideration. Here’s what to watch for, the potential risks, and the crucial questions you need to ask before signing on the dotted line.

What to watch for 

When adopting legal software in the long term, several factors must be assessed to ensure the software continues to benefit your firm’s evolving needs. Here are key components to consider before committing to a long-term fixed contract:

Adaptability and scalability

A legal software solution must align with your firm’s fluctuating dynamics. This includes ensuring that the software can easily accommodate growth, whether by increasing the number of users, managing more clients, or handling a higher volume of cases without a decline in performance.

Key considerations include:

• Flexibility for Growth: Can you add more users or additional modules (like advanced document management or performance analytics) as your firm grows without significant upgrades or price hikes?
• Customisation: Assess whether the platform allows customisation specific to your practice area. This can include tailored workflows, document templates, or reports.
• Integration capabilities: Ensure the software can integrate smoothly with other tools you use (like email platforms, accounting software, or online calendars) to maintain efficiency as your technology stack grows.

Upgrades and updates

Software that remains unchanged will quickly become obsolete. Regular updates ensure that your firm benefits from the latest technological advancements and security solutions.

Look for answers to the following:

• Update frequency: How often does the software receive updates, and what do these updates include? Are there scheduled major updates that introduce new features?
• Downtime: Find out if updates require downtime and how this is managed to minimise disruption in your practice.
• Cost: Confirm whether updates are included as part of your subscription fee or if there are additional charges for significant upgrades.

Support and training

Legal software’s value primarily depends on how effectively your team can use it. Adequate support and training are crucial during the initial transition phase, as new features are released or new staff members must be up to speed.

Evaluate the following:

• Availability and accessibility of support: What types of support are offered (phone, email, live chat)? What are the support hours, and do they align with your office hours or offer 24/7 assistance?
• It’s important to evaluate the training resources offered. Does the provider offer comprehensive training at the outset? Are there ongoing training opportunities, such as webinars, tutorials, and user conferences? This continuous support ensures that your team can adapt to new features and updates with confidence.
• Onboarding process: Look into whether personalised onboarding is available to help set up the system according to your specific needs, which can significantly reduce the learning curve and enhance adoption.

Potential risks

Before committing to a long-term fixed contract, it’s crucial to understand the potential risks that could impact your legal practice’s operational flexibility and technological advancement. Long-term agreements can reduce flexibility, making it difficult to switch providers if your software no longer meets your needs. This situation can lock your firm into outdated technology without an easy path to upgrade or integrate new tools, hindering your ability to stay competitive in a fast-evolving legal industry landscape. Watch out for these potential risks, which include reduced flexibility, technological obsolescence, and competitive disadvantage. 

Read more: Navigating The Maze Of Vendor Lock-In: Strategies And Solutions For UK Law Firms

Lock-in period

Long-term contracts can reduce flexibility, making it difficult to switch providers if your software no longer meets your needs.

Strategies to mitigate this risk:

• Understanding the terms of the contract is crucial. Be clear on contract duration and look for flexibility through opt-out clauses or periodic review opportunities where contract terms can be renegotiated. This understanding empowers you to make decisions that align with your firm’s changing needs.

Hidden costs

Unexpected costs can arise from several areas, making it crucial to read the fine print.

Common hidden fees to watch out for:

• User limits and data storage: Additional charges for exceeding user limits or data storage can significantly increase costs.
• Ancillary features: Features like advanced reporting or additional client portals may incur extra fees.

Compliance and strategy

Ensure the software meets all relevant legal and data protection standards to avoid violations that could lead to fines or reputational damage. Compliance and data security are not just regulatory requirements but also crucial elements in maintaining client trust and protecting your firm’s reputation. Therefore, it’s essential to consider these factors when choosing a legal software solution.

Key compliance considerations:

• Data hosting and security standards: Verify the provider’s compliance with relevant standards and regulations (e.g., GDPR, SRA, HIPAA).
• Audit capabilities: The system should allow you to easily produce reports and logs necessary for compliance audits or litigation.

Choosing the right legal software involves more than just assessing features. It’s about finding a solution that will adapt to your firm’s changing needs, offer ongoing support and training, and ensure compliance and data security, all while keeping hidden costs in check. By carefully evaluating these aspects, law firms can make sound decisions that promote long-term success and efficiency.

Read my blog for more on this topic: Don’t Get Duped: Smart Questions to Ask Before Switching Legal Tech.

Questions to ask before signing

• What is included in the contract? Clarify what functionalities and services are covered to avoid surprise expenses.
• Can the contract be modified or terminated early? Look for clauses that allow adjustments based on your firm’s changing needs.
• How does the provider handle data security and compliance? Confirm that they maintain high-security standards and comply with regulations like SRA, SOC2, and GDPR, as applicable.
• What happens to my data if I choose to leave? Understand the process for data migration at the end of your contract, including timelines and costs. For more on this, read my guide to data portability for law firms. 
• What support and training resources are available? Ensure these align with your firm’s needs and are readily accessible.
• How often is the software updated, and how are updates handled? This will help you ascertain if the platform will evolve according to technological advancements and industry standards.

Choosing a legal software provider is a significant decision for any law firm, and entering into a long-term fixed contract comes with its set of benefits and considerations. Clio’s comprehensive legal matter management software offers a range of features designed to streamline law firm operations, supported by a suite of resources to facilitate a seamless user experience. By carefully evaluating potential risks and armed with the right questions, law firms can ensure they make informed decisions that support their long-term success in an ever-changing legal landscape.

Remember, the goal is to choose a legal software solution that meets today’s needs and adapts to tomorrow’s challenges. With Clio, firms can leverage industry-leading security, award-winning support, and a robust feature set, ensuring they are well-equipped to deliver exceptional services while effectively managing their practice. Our team is ready to take you through the powerful functionalities of our software, answering your unique questions and highlighting how we can support your transition and long-term growth.

Schedule Your Personalised Demo with Clio.

Investing time to explore Clio’s capabilities could be the first step towards empowering your firm to meet the legal landscape’s current challenges and future opportunities. Let us show you how Clio can support your firm’s journey towards operational excellence and long-term success.

Book a Demo

See exactly how Clio can help your firm by scheduling a personalised product walkthrough with one of our Clio experts.

We published this blog post in July 2024. Last updated: October 25, 2024.

Categorized in: Clio