Research highlights role of open innovation in UK industrial strategy
New Oxford Brookes research shows how collaboration can drive innovation in professional services.
The study highlights the importance of collaboration between industry, innovators and regulators in enabling one of the UK’s most economically significant sectors to modernise and respond to rapid technological change.
The research, led by Oxford Brookes Business School, focuses on the legal sector and examines the impact of the LawTech Open Innovation Lab (LOIL) Challenge – a nine-month open innovation programme delivered by SuperTech West Midlands. The programme brought together mid-to-large law firms, professional technology Small and Medium Sized Enterprises (SMEs)and the Solicitors Regulation Authority to address shared challenges in client onboarding and regulatory compliance. The study provides new evidence on how collaborative approaches can overcome longstanding barriers to innovation in legal and wider professional services.
The research shows that in creating an appropriate trusted environment, open innovation and co-creation can be highly effective in a sector traditionally resistant to joint working. Participants report strong collaboration, enhanced market insight and greater readiness to adopt new technologies.Tackling a shared industry challenge
Client onboarding, including Know Your Customer (KYC) and Anti-Money Laundering (AML) processes, remains a major operational and regulatory burden for law firms. Despite a growing LawTech market, firms report dissatisfaction with fragmented solutions and slow adoption.
SuperTech is a West Midlands based cluster organisation supporting innovation in the professional services sector. Having run successful innovation challenges in the Financial Technology sector and using the learnings from those programmes, it was possible to bring together four law firms: Mills & Reeve, Gateley, Fieldfisher and Shoosmiths, to work collectively through the innovation challenge. This included defining the common challenge, agreeing the shared use cases and engaging directly with innovative technology providers.
The programme focused on four priority areas:
- automating and improving client data collection
- using AI to streamline conflict checks
- real-time screening for sanctions and politically exposed persons
- secure digital client onboarding portals
Strong evidence of impact
Researchers from Oxford Brookes University observed and analysed the programme using interviews, ethnographic observation and participant feedback. The findings show exceptionally high levels of engagement and satisfaction, with collaboration rated five out of five by both law firms and SMEs.
The study identifies four key enablers underpinning successful collaboration:
- willingness to challenge established practices
- shared understanding of organisational needs
- trust-building among participants
- reciprocal, non-transactional relationships
These enablers allowed firms to move beyond sales-led procurement models towards genuine co-creation of solutions.
Expert perspectives
Professor Nick Wilton, Dean of Oxford Brookes Business School, said: “This project demonstrates that when the right conditions are created, even highly competitive and regulated sectors like legal services can collaborate effectively. The LOIL Challenge provides compelling evidence that open innovation can accelerate technology adoption and strengthen the sector’s long-term competitiveness.”
Hilary Smyth-Allen, Chief Executive of SuperTech West Midlands, said: “The LOIL Challenge shows that open innovation is not just theory – it works in practice. By bringing law firms, innovators and regulators together around shared problems, we’ve shown that collaboration can unlock faster, better outcomes for the whole sector.”
Benefits for firms, innovators and policymakers
The report highlights wide-ranging benefits for participants, noting stronger connections between all participants.For law firms, benefits included:
- clearer insight into emerging LawTech solutions
- reduced risk when exploring new technologies
- cultural and skills development within firms
While for the tech SMEs reducing time to market timeline benefits included:
- Product validation or re-design requirements
- Greater understanding of demand-side needs and
- Ongoing conversations with potential clients
For policymakers, the findings underline the value of cluster-led, place-based innovation programmes in supporting SME adoption of advanced technologies, aligning closely with the UK’s Modern Industrial Strategy and the Technology Adoption Review.
Shaping the future of legal innovation
The researchers conclude that there are no shortcuts to effective innovation in professional services. Instead, sustainable progress depends on collaboration, shared learning and trust between demand and supply.
SuperTech’s open innovation programme provides a model that could be replicated across other regions and sectors, helping professional services firms modernise, adopt AI-enabled technologies and remain globally competitive.