Strategic Legal Technology

Flaky hotel internet access drains my personal productivity. Aside from whining, hotel connectivity illustrates interesting economic issues for law firms. 

In one of about every four hotel stays, I have to call tech support to get the net connection working properly. I waste a lot of time doing this. I can’t be the only one. Instead of going into gory detail, let’s look at some potentially interesting lessons for law firms:

• If you outsource a customer or client facing service, do NOT disown responsibility for it. I am a big outsourcing fan. Done right, it means improving service, not making it worse. To me, it feels hotels have outsourced AND disowned. This hurts their brand and repeat business.
• Both hotels and law firms provide a complex set of services. How do you decide what to bundle in the basic rate? Low-end hotels often bundle net access in the room rate; I’m not sure why high-end ones don’t. I occasionally choose a hotel based on free net access. Are law firms losing clients or prospects because they have unbundled too many services? I really don’t know, but it’s worth making a conscious choice.
• Metering a service is generally a prerequisite to charge for it. The fact that it’s possible to meter a service does not mean you should. Let’s not forget Skaddenomics (a famous 1991 American Lawyer cover story on Skadden Arps charging clients for coffee service).
• Everything I just wrote notwithstanding, the purchase decision is complex. With net connection problems pretty universal, loyalty programs and location still drives my hotel decisions. Since the core service offering drives decisions, improvements to extras may not be good investments.

All this leaves me concerned that in both hospitality and law, service problems will persist for a long time.

Lawyers are risk-averse. They frequently fail, however, to consider the risk of alternatives. 

Cutting a Winning Edge in Law Firm Blogs, an article about large law firm blogs illustrates this point. A blog-less BigLaw firm’s spokesperson is quoted, re firm blogs:

“They take effort, we have to generate the content and there’s a big issue when you’re communicating with the public: Are you giving legal advice?” If you say something a reader interprets as advice, you’re then in a situation you don’t want to be in.”

Never mind that e-mail alerts, articles, and content for web sites all take effort to generate. And never mind that the firm has large amounts of content on its public web site that readers might interpret as advice. Is this firm already in a situation it does not want to be in?

Fortunately, the rest of the article is a pretty good and well-balanced view of the pros and cons of BigLaw blogs. It also includes practical steps to take to minimize risks.

What are the right resources to solve a legal problem? How should you even think about this question? 

Many answers are possible. Below, I set forth one model - a classic management consultant’s 2-by-2. On the x-axis, plot complexity of work, from low to high. On the y-axis, plot volume of work, also from low to high. Draw lines at the axes’ centers and you define four quadrants. The bottom-left is low complexity and low volume, the top-right is high complexity and high volume, and so forth.

Intentionally absent are specific measures. The idea is consider the right resource for each quadrant without worrying about detailed measures. In my analysis, the simplest legal problems (lower left) can be solved with checklists. Automation (e.g., document assembly or expert systems) can solve low to medium (and even high) complexity problems given high enough volume (required to earn an ROI on the upfront cost to develop the system).

Off to right, for complex work, I assume lawyers are the right resource. But then there’s the big middle ground of medium complexity work at low or high volumes. Here, I suggest, a combination of paralegals, other professionals, temp lawyers, and offshore lawyers. Note that in general, shaded areas intentionally overlap.

Each person likely would draw the circles / ellipses elsewhere. The point is to use this approach to think about and discuss what resources to deploy to solve legal problems.

How many clients have systematically thought about their portfolio of legal problems and the optimal resource mix? Perhaps most general counsels intuitively choose the right resources for all their problems. I suspect that going through this or another systematic exercise / analysis might identify cost savings.

[I have previously proposed a different two-by-two framework for assessing investments in legal technology.]

Law firm CIOs and other managers who want the proverbial “seat at the table” need to follow law firm economics. For large law firms that means the AmLaw rankings. 

I could not attend the American Lawyer rankings preview webinar today but found an excellent summary by Adam Smith, Esq. at The AmLaw 100 for 2007: “Flash Report”.

The new American Lawyer web site will soon post more information.

Update (1040pm EDT, 29 April 2008): See The 2008 AM LAW 100: Lessons of The Am Law 100 (American Lawyer, 1 May 2008). As of now, the only chart I can find on the web is RPL [Revenue per Lawyer] Ranks 1998-2007. Have some fun: copy and pasted the entire table into a spreadsheet so you can sort and analyze.

Update - Sponsored Link (1 May 08): Click here to buy the 2008 AmLaw 100 downloadable file. Now you’re really talking fun.

Open source software has had a dramatic impact on how business and consumers use computers. Could the same be true for law? 

I blogged about the idea of open source law four years ago. Lawyers Open Their File Cabinets for a Web Resource (New York Times, 27 April 2008) reminds me of that idea. The article focuses on JD Supra, which stocks “a free, virtual law library by persuading lawyers to do something highly unusual: to post examples of their legal work online for use by one and all, no strings attached. Many of the documents are articles and newsletters that can be understood by ordinary mortals who want more background on a legal issue, or who would like to find lawyers with expertise in a particular area.”

JD Surpra moves the market closer to the open source model by providing a sharing platform. Several steps are still needed to get to the web-based collaboration, iterative improvements, and free sharing of a true open source approach. My March 2008 blog post, New Collaborative Web Sites for Legal Market reported on JD Supra, as well as Legal Onramp, which is more geared toward the B2B market.

Inhouse counsel frequently express concern about escalating legal costs. They can’t reduce demand so they need to find cheaper ways to deliver advice. Is an open source approach a realistic cost-saving approach now that the platforms to support it exist? Of course, there are many reasons not to pursue the concept: it’s a bad idea, lawyers have not done it in the past so why should they do it now, the free-rider syndrome, and lack of incentives to share. On that last point, I will leave it to others to ponder why whole communities of software developers happily share work product and lawyers do not. [I think the answer involves more than just confidentiality.]

The entry of established, adjacent players in an emerging market is a sign of good times. This is now happening with legal process outsourcing. 

I began writing about legal outsourcing (onshore and offshore) five years ago. Since then, the LPO market has grown. There have been countless articles in both the legal and general press (the most recent being Contract with India: Legal outsourcing, Financial Post, 25 April 2008). And the number of LPOs as tracked by Joy London and me is now over 100.

Another positive sign for a market is when established players enter it. Infosys and Wipro are two of the largest and most successful outsourcing companies in India. On April 28th, the Economic Times reports in Wipro logs on to LPO services that Wipro “has started offering legal process outsourcing (LPO) services.” As Wipro notes on its LPO web page, “With growing focus on profitability and cost reduction by corporations & law firms, things are beginning to change - and, like in many industries, outsourcing is playing a key role.” Earlier, on 5 Nov 2007, the Economic Times reported in Law & order: Infosys to foray into LPO business. (See the Infosys LPO web page.)

It will be interesting to see the impact of these well-established companies on the LPO market. Both Wipro and Infosys have great brand equity in business process and IT outsourcing. It’s not obvious, however, that this brand equity counts for much with general counsels. What may matter more are the relationships both have with with CIOs, CFOs, or COOs and whether introductions from them effect CLO decision-making.

I’ve long thought that litigators should more frequently use litigation risk analysis using formal decision trees. 

I am swimming against the tide. In Making the Case for Change (ABA Journal, April 2008), the sub-article Case Evaluation: Too much em­phasis on a quantitative ap­proach often misses key factors by Louis M. Solomon of Proskauer criticizes over-reliance on decision trees: “An overly numerical approach to case evaluation has serious limitations. Formal case evaluation seeks to achieve an optimal identification of possible outcomes, but perfection in the process cannot be achieved. An unthinking use or overuse of mathematically driven case evaluations does not serve clients well.”

Beyond complexity, Solomon lists three limitations of decision trees:
1. Overemphasis of quantifiable factors
2. Discounting small probabilities
3. Inadequate consideration of the client’s risk tolerance

He closes, however, by acknowledging its potential value, especially to dispel fuzzy thinking and statements like “you have a good chance of winning.”

I’m not a litigator and I don’t know the right answer. But I view this technique as I do drugs, devices, or medical procedures. What does the evidence say? I’m not sure enough litigators and clients have used decision trees properly and compared alternative risk assessment methods to reach an empirically sound conclusion. Sure decision trees are hard and have limits. But for cases about money (and most are), what is the better approach to assess risk and set up a framework for discussing decisions? If achieving “perfection in the process” is the standard, we may as well give up at the outset. The fact that doing risk analysis is hard may mean lawyers need more training, not that they should ignore a potentially valuable technique.

A Rees Morrison blog post alerted me to this article. In a separate post, Law firms, law departments and the asymmetry of concern about money Morrison concludes that “firms and departments exhibit an imbalanced focus on money. Where many people outside focus on increasing money, relatively few people inside – and only part of the time and reluctantly at that – focus on holding the line” Perhaps if inhouse counsel were more concerned about holding the line, they’d eagerly employ decision trees. Have they even used risk analysis enough to say it’s not worth the effort?

Wouldn’t it be great for business development if you could tap all the connections that your fellow lawyers and staff have? 

Well you can. Doing so has been easy for quite some time as I reported in Something for Nothing? Enterprise Relationship Discovery (30 May 2007).

If you are in large law firm knowledge management, marketing, or business development, it should now be easier to persuade management to buy enterprise relationship discovery software. Email Software Delves Into Employees’ Contacts (Wall Street Journal, 21 April 2008) reports on this category of software. “Companies are rolling out software that allows them to mine their employees’ emails and electronic address books for contact information, in a bid to make it easier to establish relationships with potential clients and others.” The article reports that Contact Networks “is used at about 40 law firms, including Skadden, Arps, Slate, Meagher & Flom LLP and Weil, Gotshal & Manges LLP”.

Few firms like to be first to try something new. A mainstream media report on something means it can’t be all that new. And with two named AmLaw 100 firms as customers and 38 other law firms (and that is just for one product), other firms risk missing being in the middle of the adoption curve, where they usually prefer to be. How long before partners grill the CIO, CKO, or CMO about why the firm does not have this type of product?

Two conferences in the last week examined the future of law practice. Change is forecast but I wonder. 

On Friday, I was a panelist at the NALP annual conference plenary session, The Future of Law Practice: Trends, Predictions, and Imperatives. Some panelists predicted big changes, from a re-working of law schools, to a resurgence of solo practitioners, to a return to values. [Since I was a panelist, I could not blog this one in real time!]

At the same time, Georgetown University “Future of the Global Law Firm” symposium [PDF], reported on in some detail by Adam Smith, Esq in Georgetown Conference on the Future of the Global Law Firm: First-Hand Report. Likewise, much change predicted.

Yet this weekend, as I read Corporate Counsel and Law Practice Management magazines, I was struck by the number of articles that could have appeared - indeed actually did appear - with similar advice 5, 10, or 20 years ago. If things are changing so fast, what are the indicators? Allowing law firms to go public in Australia and the UK may lead to big things but the jury is still out.

And where are the clients in this discussion? Adam Smith, Esq’s list of attendees includes not a single general counsel. If they were not invited, what does that say? If they were but did not come, what does that say? Skimming the NALP attendance list (1300+) I saw only one inhouse law department represented.

Other than Marc Chandler of Cisco, who rightly gets a lot of PR for changes the Cisco law department is making, where are the articles about inhouse counsel doing things a new way? Convergence? Been there, done that, and it may not be working all that well anyway. Alternate billing. Under discussion since at least 1990.

I am still waiting for clients to exercise their market power in a big, new way. Without that, I think it’s more of the same.

Finding and filtering relevant documents in e-discovery is a big challenge. What steps must a lawyer take? Just how far does a lawyer’s ethical obligation go? 

In Improving E-Discovery with Smart [Humans] [Technology] (16 March 2008) I suggested that lawyers must learn enough about e-discovery software to use it effectively to search for and find relevant documents. (But I agree with Will Uppington’s comment that the software could be easier to learn.)

Craig Ball, in his always excellent Law Technology News column, addresses this issue in The Science of Search (April 2008). He concludes that lawyers

“need to learn more about the science of search as part of our legal and continuing education. We need to become skilled at tools and methods that help us refine searches and routinely test them against representative data so we can distinguish noisy terms from effective ones and learn to zero in on relevant ESI.”

Does a litigator’s ethical duty of zealous representation extend to learning search software. As I understand it, difficulty does not excuse a lawyer from a duty but may be a basis for delegation with supervision. Ethics aside, I agree with Ball that as a practical matter, lawyers must learn how to search. Unfortunately, this challenge is bigger than meets the eye.

Ball also writes that “lawyers believe themselves adept at keyword search in e-discovery because they’ve mastered keyword search in online legal research.” Lawyers may honestly believe they know how to search, but I suspect this is another honestly held but wrong belief. My conversations with law librarians over two decades suggest many lawyers have not mastered online legal research search techniques.

To clarify a lawyers’ obligation, all we need is a malpractice case. It would allege that a lawyers failure competently to search an e-discovery database led to a bad outcome. Nothing like a malpractice case to cause lawyers to pay attention.

The International Legal Technology Association is conducting a knowledge management survey for an upcoming KM white paper. It is open to non-ILTA members. 

An e-mail from ILTA, which I have permission to share, states “In preparation for an article which will be published in a future ILTA whitepaper, the ILTA KM Peer Group is conducting a survey to assess the scope of knowledge management initiatives in the legal sector. We are interested in compiling trends about KM strategy and projects as well as collaboration points with administrative departments. We hope to learn more about current activities, ascertain how far we have come with KM initiatives to date, and map out where we see ourselves heading in the future.”

Click here to complete the ILTA KM survey. This is a link to a Zoomerang survey with 25 questions, several demographic, the rest substantive.

Update (22 April 2008): The ILTA web site now includes a launch point for this KM survey.

In this Roundup, some well-known legal tech and legal management people are on the move; an analysis of why law firms are not good at team work; and a survey of software in use at top UK law firms. 

People on the Move

• Rees Morrison, well-known consultant and blogger at Law Department Management, reports in a blog post that has left Thomson / Hildebrandt to form his own law department consulting firm.
• Jeff Beard, a well-known legal technology expert and blogger (Law Tech Guru) has joined EED Inc as a senior consultant.
• Bruce MacEwen, aka blogger Adam Smith, Esq., has formed a strategic consulting alliance with both Jomati Consultants LLP (based in the UK) and Altman Weil, Inc. (based in the US).

The Challenge of Working in Law Firms Explained
Jordan Furlong writes in Cheating or collaborating? about law schools not teaching team work. I’ve long thought that a fundamental challenge of working in large law firms - and innovating - is that many lawyers are team-challenged. It starts in school. And Jordan calls law schools on this atavistic approach.

Survey of Software in Use by Top 250 UK Law Firms
Legal Technology Insider tracks software in use by the top 250 British law firms, as reported in the Orange Rag blog. Sorted by number of fee-earners in the UK, the list reports summary stats for the firm and the brands of software in use for accounting, document management, case-workflow-BPM, digital dictation, CRM & marketing, cost recovery, document assembly, knowledge management, and library management. I am not aware of an equivalent free resource for US firms. (The closest match I can think of is ALM’s 2006 Tech Buys - this link is on this site and is a sponsored link. If anyone knows of better US resources, please let me know.)

Legal process outsourcing continues to make the news in mainstream media. This time its Time. And now it’s time to ask where we are in LPO adoption. 

The New York Times, Wall Street Journal, and Business Week have covered LPOs. Call My Lawyer … in India (Time, 3 April 2008) opens with a point not usually voiced. It quotes a lawyer who “says he’s ethically obligated to do what’s best for his clients, ‘and that includes saving them money’.” The General Counsel of TransUnion (N.B.: another law department on the record about outsourcing) cites document review savings of 85% versus the domestic alternative. Interesting that many BigLaw partners on record in the legal trade press focus on the potential risks and overlook what may be another ethical duty.

Time reports the potential confidentiality issue. It does cite the numerous security measures Integreon takes (full disclosure: I work for Integreon) but leaves the issue open. Does this situation remind you of anything?

If you worked in the legal market in the early 1990s, it should remind you of lawyer adoption of e-mail. Many resisted e-mail - why, it might not be safe!! Who knows where a message goes once I hit send!!!!!! Never mind that doubters happily sent confidential faxes to hotels where it was guaranteed a third party would see (if not read) the fax. Never mind the Fedex disclaimer explicitly did not guarantee privacy.

Today, it’s hard to find a lawyer who does not use e-mail. And it’s not that the infrastructure is more secure. What finally drove adoption was widespread use of e-mail by clients. Interestingly, many clients today move highly sensitive data around the world, both among their own operations and to third parties, including outsourcers in India.

Legal outsourcing may not achieve the near 100% adoption of e-mail. It seem likely though, that it will share a similar attitudinal outcome with e-mail: in a few years, most lawyers will wonder what all the fuss and worry was about.

This post originally appeared at Strategic Legal Technology.

I don’t normally write about spam but I just received a new and irritating type I’ve not previously seen. 

In my junk mail folder in Outlook 2003, missed by the spam filter on my server, is a spam message about an award. But this is no ordinary message; instead, it’s an Outlook meeting request. So not only do I have junk mail, I have a junk tentative appointment in my calendar - for today, where I will certainly see it. I had to resist “declining” the request, which would delete the appointment from from my calendar but send back an e-mail.

Is this a new type of spam or have I just been lucky so far not to have seen this?

Inside Counsel (April 2008) reports on a LexisNexis survey on information overload by professionals: “77% of legal professionals… cite a clack of sufficient information technology tools to cope with the ever-increasing information burden." 

Law firms and legal market vendors undoubtedly can do better in creating, deploying, and training on tools. But it irks me to see surveys point fingers at IT professionals. I’ve run IT at a law firm and hosted widely publicized internal seminars to create awareness of or training on new tools. Often, literally not a single lawyer shows up. And many lawyers who complain have almost no patience to learn new software or new features. So many lawyers have only themselves to blame.

Let’s say a lawyer spends 1000 hours/year in front of a PC. Wouldn’t it make sense to spend 5 to 10 hours per year to learn how to use that tool more effectively? Don’t we think that would more than payback the time invested? (Of course, the invested time is not billable and therein lies the deeper issue).

And this is not just about learning tools. How about learning simple information management “hygiene?” For example, don’t reply all to an e-mail unless clearly warranted. Or if you use the same e-mail thread and change topics, change the subject line to so indicate. Or when someone sends you a file and you modify it, save it with a new name before you send it back so that both you and the recipient have clearly labeled original and marked up versions. Many simple steps make info management easier all around but few take these steps.

Then years ago, I would have said the onus was on IT professionals to improve. Today, users have the bigger burden. Those too busy to sharpen their ax should not blame the ax-maker for having a bad tool.

[Click here for a summary of the LexisNexis LexisNexis Workplace Productivity Survey, completed in December 2007. (PDF).]

In the war for clients, results count. 

Obvious as that may be, where are good metrics that measure legal results? In Legal Tech 2.0 I described a war for clients driven by service and results. Game-changing uses of technology can win battles. I suggested that a weapon ripe for development is metric for results.

The failure of the legal market to develop metrics is likely one reason for purchasing departments and sourcing professionals inserting themselves in outside counsel selection. Hiring Lawyers by the Numbers (Legal Times, 24 Mar 2008; GC Mid Altantic, 1 Apr 2008) by Ursula Furi-Perry describes how “Procurement Divisions Get more Involved with Hiring Outside Counsel.” In it, I am quoted extensively:

Some corporations are implementing policies that mandate that their procurement or purchasing departments become involved in every decision to outsource services—including legal work—says Ron Friedmann, president of Prism Legal Consultants [sic] Inc.
The procurement department is often brought in because some corporations understand that their attorneys aren’t that great with numbers, budgets, and purchasing, Friedmann says. Management may think that attorneys tend not to negotiate legal costs and decide to step in. “When purchasing departments see how lawyers operate, they see low-hanging fruit,” Friedmann says. For the cost-conscious company, legal services present an easy way to reduce costs.
“One of the challenges is balancing how well the outside firm knows the company’s business with how cost-effective they are overall,” Friedmann says.
“It’s clear that corporations are increasingly looking at ways to save money, and law departments are cost-centers and need to be managed as cost-centers,” Friedmann explains. “A forward-thinking general counsel should look to the purchasing department for help.”
Law departments can also help by drawing clear lines between legal projects and cases that need different types of attention and assistance. For instance, law departments can help differentiate “low-end” work from “high-end work,” Friedmann says.
“Some may be higher-stake, but there are a lot of lower-level day-to-day claims . . . that are fairly straightforward.” For those cases, general counsel should first determine whether to in-source or outsource the work, and if the decision is to outsource, “the next question is, whom do we outsource to?” Friedmann says. “If you separate the nature of the cases, you can apply different sets of criteria.”
General counsel may be worried about alienating long-term outside counsel colleagues, yet cost-cutting measures don’t necessarily have to adversely impact trusted outside counsel relationships. “There are ways of managing purchasing that are still respectful of relationships,” Friedmann says. Have scientific—not antagonistic—conversations with outside counsel, he recommends, laying out data about their costs and the costs of competitors.

My comments are another way of saying it’s all about results. General counsels who rue the day they had to involve, placate, or answer to purchasing would be in a stronger position if they had independently developed better metrics to assess their budgets and results.

What if enterprises could do away with Microsoft exchange servers? 

Maybe they can now, and without switching to Lotus Notes. Bringing Outlook and Gmail Closer Together (NY Times blog and in print on 31 March 2008) describes a product by Cemaphore Systems called MailShadow for Google Apps. It

“allows people to automatically synchronize their e-mail, calendar and address books between Microsoft’s Outlook and Google’s Gmail… it represents an interesting use of the Google computing “cloud”… [it] would allow businesses to rip out their Exchange servers and run Outlook, which millions of users are familiar with, directly from the Google servers.”

This technology has potential as both a back-up service for law firm e-mail, if not as a way to eliminate Exchange servers. I’ve previously written about Google’s Cloud Computing; this is an application / service that rides on top of it.

I’m not techie enough to venture a guess on the potential e-discovery implications of moving to this architecture. At minimum, it would be one more data source to harvest.

Blogging continues to grow in big law firms. 

Kevin O’Keefe of LexBlog posted his State of the AmLaw 200 blogosphere, March 2008 last week. He found that from August 2007 to March 2008, the number of big law firm blogs grew from 74 to 110. Of the 110, 80 are firm branded.

Joy London and I also track firm-branded blogs. We reported our findings in Updated Directory of Large Law Firm Branded Blogs (20 Nov 2007) and at our list of Large US Law Firm Branded Blogs. The differences in our blog counts probably results from Joy and me missing some blogs, new ones since our update, and different definitions of what constitutes firm-branded.

However you slice the data, the trend clearly continues up. With many firms spending 2% of gross revenue on marketing and already producing a stream of legal content, I am surprised the number of blogs is not much higher. My analysis of blogging in Blogging – Why the Fuss, suggests that a rational assessment of the costs and benefits of competing marketing channels favors blogging over many alternative marketing activities (aka lead generation).

Many discuss legal outsourcing but few admit doing it. 

I predicted in January that more law firms will go public about outsourcing. As more law departments reveal publicly that they outsource and offshore, barrier for law firms to do the same falls.

HSBC launches offshore legal team for bulk work in LegalWeek.com (7 Feb 2008) reports that “FTSE 100 banking giant” HSBC “has set up a team of four lawyers in its global service centre in Malaysia’s capital, Kuala Lumpur.” The article also reports that BT “last year expanded its existing offshore legal function in New Delhi with two new outposts in Sao Paulo and Buenos Aires to support its US operations”

Separately, Offshoring litigation work in India is a podcast by The International Institute for Conflict Prevention & Resolution (click here for landing page for CPR’s complete podcast directory). CPR interviews co-founder Sanjay Kamlani and VP of Legal Services Shelly Dalrymple of Pangea3 (40 minutes). Starting at about time mark 26:50, Mr. Kamlani shares that Philip Morris has a 10-person Pangea3 team working on day-to-day contracting worldwide.

How many more BigLaw partners will go on record about the risks of offshoring legal work when their clients - or companies they would like as clients - are already doing so?

See list of outsourced legal services for other companies offshoring.

This first appeared at Strategic Legal Technology at Prism Legal.

Update (29 Mar 08): Picking an Outsourcing Partner (The Recorder, 31 Mar 08) reports that O’Melveny’s marketing department outsources research to India.

I started blogging here 5 years ago. It’s a good occasion to think about how my posts have evolved. I now see that both the legal market and I have moved to “Legal Technology 2.0″. 

Why, you might wonder, does a blog called Strategic Legal Technology cover topics such as working virtually, derivatives to manage law suits, business intelligence, and outsourcing? In Legal Technology 1.0, we focused on infrastructure and applications. Just getting IT to work and lawyers to adopt new systems was a huge challenge. That’s still hard, but around 2000, forward thinking CIOs began thinking about “operations” in one bin and “strategy / practice support” in another. Today, even that distinction is not enough.

In Legal Technology 2.0, firms and CIOs must deeply embed technology in their strategies. Legal Tech 2.0 stems from a two-front legal market war; each front has two battles. There is a war for talent and a war for clients. To get and keep talent, firms must offer the right mix of life style and compensation. To get and keep clients, they must offer the right mix of client service and results. See the illustration below.

In Legal Tech 2.0, firms must wield technology to win these battles. Simple “first order (1st order) technologies” as weapons no long suffice. Instead, firms need “second order (2nd order) technologies”. This is more than merely rolling out new apps. They must transform how they do business, with tech playing a central role.

It’s already happening - I’m just labeling it. Consider Bryan Cave’s business intelligence, Morrison Foerster’s AnswerBase, or Mallesons web-supported recruiting. And consider that at least two global law firm CIOs have new roles and titles that go well beyond technology to encompass business process and strategy.

Two years ago, I developed a portfolio approach to evaluating practice systems. It’s a “2x2″ framework for choosing among practice support tools by comparing revenue enhancement impact against reduction in effort effects. Nice, but not closely enough linked to business strategy.

In the diagram below, an illustration and not a comprehensive picture, I link three 2nd-order uses of technology to law firm battle fronts. ”Working virtually” is a way for law firms to offer lawyers and staff improved life styles. Outsourcing is a way for firms to reduce cost (and hence increase compensation) and improve client service (and hence gain and retain clients). Technology enables both but firms must make many other process and cultural changes.

“Results Metrics” has yet to be conquered. Firms that crack this will win market share. Using technology, surveys, interview, and research, firms or third parties must devise ways to evaluate more rigorously the results of legal representation. When clients can choose from many A-list global law firms, real data on actual results will play an increasingly important role. (Of course, 2nd order tech will be critical to improving results.)

I could have lined up other 2nd order technologies here, including ones I’ve written about such as online legal services, knowledge management, business intelligence, decision trees, etc. The point though is to figure out what the new 2nd order technologies will be. As Legal Tech 2.0 evolves, how will we as a profession and market create additional weapons to fight the battles to come?

This first appeared at Strategic Legal Technology at Prism Legal.