Template:Legaltech as rent-seeking
Legaltech addresses inefficiencies which manifest themselves as negative annuities: ongoing costs and resource drains for quotidian tasks with minimal value. It is, therefore, predicated on the vendor earning not just a profit, but an annuity. The thought process is this: if customers have an ongoing cost of ten, they will be prepared to pay me an ongoing cost of two to remove it. Mathematically, unimpeachable logic.
But there is a paradox here: If your legaltech solution costs you something like two: that is, it continues to require costs and resources such that two represents a fair margin on work you continue to do, then this is not legaltech but something else. It may well be deft process-reengineering coupled with outsourcing[1] — but that is not legaltech. That is management consultancy.
If your solution really is legaltech: if the work needed to remove your ongoing cost of ten is achieved upon implementation done then, once I have paid for its implementation, why should I pay an ongoing marginal cost per unit?
My problem is solved. There is no longer an ongoing cost of ten. The machine costs nothing to operate. My question is now: what on earth am I paying this ongoing running cost for?
- ↑ Outsourcing has its own hidden costs and shortcomings, of course.