Last Updated on February 12, 2026 Sarah Gayda
A growing number of corporate legal departments and law firms are replacing legacy systems with a Microsoft 365 legal DMS strategy. As Microsoft 365 continues to mature, legal teams are asking a fundamental question: can it function as a full legal document management system — and should it replace traditional platforms?
As Microsoft 365 continues to mature, legal teams are reassessing traditional document management systems and exploring how a Microsoft 365 legal DMS strategy can modernize governance, reduce complexity, and improve daily workflows.
The five reasons below outline why many legal teams are moving toward a Microsoft 365 legal DMS strategy — and what that shift means in practice. You can explore this topic further in our webinar, 5 Reasons to Use M365 as Your Legal Document Management System.
To understand why this shift is accelerating, it helps to first clarify what a Microsoft 365 legal DMS actually entails.
What Is a Microsoft 365 Legal DMS?
A Microsoft 365 legal DMS refers to using Microsoft 365 — particularly SharePoint Online, Outlook, Teams, and compliance capabilities — as the structured repository for legal documents, email, and matter-related information.
Rather than relying on a separate, legacy DMS platform, legal teams configure Microsoft 365 to:
- Organize documents by legal matter
- Capture and classify email alongside related files
- Apply retention and compliance controls
- Enable secure collaboration across the organization
- Support defensible search and retrieval
This approach shifts document management from a siloed system to an integrated digital workplace.
For a broader overview of how legal teams structure and govern information, see our guide to legal document management in Microsoft 365.
With that foundation in place, there are five core reasons legal teams are replacing legacy systems with a Microsoft 365 legal DMS strategy.
Reason #1: Microsoft 365 Is Already the Legal Team’s Daily Workspace
One of the most important realities facing legal teams today is simple: legal professionals already work inside Microsoft 365 every day.
Outlook, Teams, Word, Excel, and SharePoint are not peripheral tools — they are the primary workspace.
Maintaining a separate legacy legal DMS introduces friction:
- Lawyers must switch systems to file documents.
- Email remains in personal inboxes instead of governed repositories.
- Duplicate content proliferates.
- Adoption suffers.
By contrast, using Microsoft 365 as the legal DMS eliminates the system switch. Documents and communications remain within the environment where work already happens.
This broader shift reflects what we explored in our analysis of how Microsoft 365 is becoming a leading solution for legal teams, particularly as organizations consolidate systems and modernize workflows.
Reason #2: SharePoint Can Be Enabled for Matter-Centric Organization
Effective legal document management depends on organizing information by matter rather than by department or file type.
When SharePoint is structured correctly:
- Each legal matter can have its own workspace.
- Permissions can be controlled at the matter level.
- Metadata can standardize document classification.
- Search becomes faster and more precise.
This mirrors the structure of traditional legal DMS platforms — but within the Microsoft 365 ecosystem.
Reason #3: Email Must Be Part of the Legal DMS — Not Separate From It
In many legal environments, email remains the weakest link in document management.
Many legal teams still rely on Outlook folders as the de facto repository. That approach creates:
- Inconsistent retention
- Incomplete matter files
- Increased eDiscovery risk
- Reliance on individual inbox management
A Microsoft 365 legal DMS approach integrates email into the matter workspace — ensuring messages and attachments are stored alongside related documents.
This shift aligns closely with best practices in email management for lawyers, where consistent capture and governance of communications are critical to compliance and efficiency.
This dramatically improves:
- Context
- Compliance
- Searchability
- Auditability
Real-World Results from Structured Email Capture
Legal teams that embed email capture into their Microsoft 365 legal DMS workflows consistently report measurable efficiency gains. For example:
- The Independent Office for Police Conduct (IOPC) reduced time spent managing and retrieving email by more than 20 hours per lawyer per month after implementing structured capture into SharePoint matter workspaces.
Read the full case study. - The legal department at L. Fournier & Fils saved up to 80 hours per person annually by ensuring email and documents were consistently filed into governed workspaces.
Read the full case study.
These examples demonstrate that integrating email into a matter-centric Microsoft 365 legal DMS is not just a theoretical improvement — it delivers operational impact.
Reason #4: Governance and Compliance Are Built Into the Platform
Traditional DMS systems often require separate compliance integrations. Microsoft 365 includes:
- Retention labels
- Legal holds
- Audit logs
- eDiscovery capabilities
- Sensitivity labels
When properly configured, these features enable defensible information management from the start — rather than layering governance after the fact.
This aligns directly with modern information governance for law firms, where lifecycle control and auditability are essential.
Reason #5: Platform Consolidation Reduces Cost and Complexity
Cost and operational complexity are major drivers behind the shift toward Microsoft 365. Many legal organizations maintain separate systems for:
- Email platforms
- Collaboration tools
- Legacy legal DMS systems
- Storage environments
By consolidating onto Microsoft 365:
- Licensing becomes simpler.
- Infrastructure is streamlined.
- IT overhead decreases.
- Security controls are centralized.
For many legal teams, the move to a Microsoft 365 legal DMS is as much about simplification as functionality. Unlike broader discussions about Microsoft 365 as a strategic platform for legal teams, this shift specifically focuses on using Microsoft 365 as the core legal document management system.
Where Colligo Fits In
Microsoft 365 provides a strong foundation, but real adoption happens when legal workflows—like matter-based filing and metadata capture—are built into daily tools such as Outlook and Teams.
This is where purpose-built solutions play a role. Colligo helps legal teams:
- File email directly from Outlook into SharePoint matter workspaces
- Enforce metadata and classification at the point of capture
- Reduce reliance on manual filing
- Improve consistency across the legal team
Rather than replacing Microsoft 365, Colligo extends it — ensuring it operates effectively as a legal DMS.
Is Microsoft 365 the Right Legal DMS for Every Organization?
Moving to Microsoft 365 as a legal DMS is not simply a technology decision — it is an architectural and governance decision.
Success requires:
- Clear matter-based structure
- Defined metadata taxonomy
- Retention policies
- User training
- Governance oversight
When those elements are in place, Microsoft 365 can function effectively as a modern legal DMS.
Common Questions About Using Microsoft 365 as a Legal DMS
A Microsoft 365 legal DMS uses SharePoint, Outlook, Teams, and compliance tools to manage legal documents and email in a matter-centric, governed environment.
Yes — when properly structured and supported by governance workflows, Microsoft 365 can replace many traditional legal DMS systems.
Email and attachments are filed into matter workspaces in SharePoint, ensuring they are searchable, retained, and managed alongside related documents.
Yes. Microsoft 365 includes eDiscovery and audit tools that support defensible retrieval and review of electronically stored information.
Colligo helps embed document and email capture directly into Outlook and Microsoft 365 workflows, improving consistency and compliance.
Get in Touch
If you’re evaluating whether Microsoft 365 can serve as your legal DMS, explore our case studies or schedule a discussion to see how other legal teams have made the transition.