Page 116 - Impact: Collected Essays on Expanding Access to Justice

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Disruption and the “Low” end of the Legal services market
Most will agree that while the changes to incumbent firms in the legal services market as we currently know it may be dramatic, the potential benefits to the consumer and prospective consumer of legal services are also significant . Indeed, the streamlining of services likely means that significant cost savings can be passed on to the consumer . In a legal market where eighty percent of the legal needs of low-income Americans and half of the legal needs of middle-income Americans remain unaddressed,7 mostly because those with such needs cannot afford an attorney, any disruption to the cost of legal services will likely inure to the benefit of those who cannot otherwise afford an attorney, as streamlined—and less expensive—services will be closer to the reach to a broader segment of society .
But this disruption, what Schumpeter called “creative destruction”—is both creative and destructive .8 It will not be without its costs . The costs to the legal profession could be significant . While some may argue that the technology-enabled innovations in the provision of legal services could mean there will be less of a need for lawyers, I believe the significant “justice gap” – the fact that a significant number of Americans face their legal problems without a lawyer simply because they cannot afford one -- means there is plenty of work to go around, provided the price is right . Once the cost of services, scope of services, need for services, and ability of prospective clients to pay for services all meet on a particular price point, there could be a significant increase in customer demand for legal services, and a greater demand for lawyers to meet that need .
For many lamenting the advent of disruption in the legal services field, they turn to the impact of new technological innovations, and the social innovations they spur (like the ability to outsource document review), on large, incumbent law firms, instead of turning to where true disruptive innovation tends to appear . According to Christensen, true disruption in a market occurs at the lower ends of that market, where incumbent goods and services are both out of reach of that end of the market, but where those goods and services have features that exceed the need .9 Indeed, few consumers of legal services would choose to pay tens of thousands of dollars to defend themselves in a traffic violation action, yet if they were paying a high-end lawyer his or her hourly rate to represent the client, that is what the services would cost .
If we take this view of the legal profession, and look at the low end of the market to identify opportunities for true disruptive innovation, it is in the provision of services to low- and moderate- income communities where this type of innovation will unfold . As Christensen and his co- authors recently reiterated in an article for the Harvard Business Review, the theory of disruptive innovation looks for change first in the lower ends of a given market, not in the wealthier and more expensive corner of the market .10
If this is the case—that true disruptive innovation will occur where legal services are crafted to meet the needs of low- and moderate-income Americans, what are the prospective benefits that can accrue to such communities by the provision of streamlined, efficient, and less costly services? Perhaps equally important, what are the potential downsides of such innovation?
7 Deborah L. Rhode, Access to Justice: An Agenda for Legal Education and Research, 62 J. legal educ. 531, 531 (2013).
8 JosePh schumPeTer, caPiTalism, socialism, and democracy 83 (3d ed. 1962).
9 clayTon m. chrisTensen, The innoVaTor’s dilemma: The reVoluTionary book ThaT will change The way you do business 16 (2011 ed.) (noting that disruptive innovation begins at the lower end of a given market and slowly works its way into the mainstream, displacing incumbents).
10 Clayton Christensen et al., What is Disruptive Innovation?, harV. bus. reV. 44 (December 2015).
Impact: Collected Essays on Expanding Access to Justice