Strategic Legal Technology

The Wall Street Journal article Bringing Surgeons Down to Earth (11/16/05, $) reports on making surgeons pay more attention to non-doctors in the operating room, which turns out to save lives. Lawyers are at the top of their own caste system – can they learn from doctors? 

“There is mounting evidence that poor communication between hospital support staff and surgeons is the leading cause of avoidable surgical errors… a big part of the problem is the intense atmosphere of the OR, where surgeons are the captains of the ship, treated with deference because of their unique skills”

Sound familiar? When big cases get intense, the senior lawyer may ignore team members, especially non-lawyers. The stakes are not life and death, but more communication might improve results.

The WSJ article reports that hospitals are following in the footsteps of the aviation industry, which spent 20 years on cockpit management and creating an environment in which the flight crew can talk to pilots, especially in emergencies. Hospitals are adopting the equivalent of pre-flight checklists and team-building strategies that encourage open communication in the OR.

But “nurses and staff can still find it difficult to speak up… OR staff will feel comfortable challenging authority in the long run only if hospital executives and administrators champion change.” Lawyers who do not see a communication problem in law firms should note that one “survey found that surgeons often don’t perceive a problem with communication, while nurses do.”

Law firms are not nearly as hierarchical as corporations; the most junior staff has access to managing partners. But the law firm caste system is rigid – you’re either a lawyer or not, a partner or not. Just as in the OR, breaking down the caste system for better team communication will likely yield better results.

What’s that got to do with technology? Just ask an experienced legal assistant or litigation support manager about watching cases crash and burn because the lawyer ignored advice about how and when to manage discovery documents. Or ask a lawyer who’s been embarrassed by sending a document from which the meta-data was not removed.

Complex legal matters require a wide range of expertise. Like pilots and surgeons, lawyers should listen to their teams.

Will lawyers contribute to knowledge management efforts? In the US, the answer is probably not. Even among corporate counsel, where the billable hour does not create perverse incentives, lawyers do not contribute. 

Fellow blogger and law department consultant Rees Morrison writes (12/21/05) that law department Intranets “languish in a state of desuetude because lawyers, the custodians of substantive knowledge, can’t be bothered to contribute.”

I wrote an article a couple of years ago that compares manual and automated approaches. In the US market, manual efforts seem limited to practice groups; big institutional efforts typically do not work. I have also written why automated approaches are better.

Can good business intelligence analysis affect a large firm merger? We may find out if Bryan Cave and Squire Sanders merge - a possibility reported earlier this week. 

Bryan Cave may be looking at merger (12/20/05) reports that “St. Louis law firm Bryan Cave LLP is in merger talks with Cleveland-based Squire, Sanders & Dempsey LLP, according to a trade publication.”

I’ve written about the very sophisticated and useful business intelligence program at Bryan Cave. In a merger, it would be interesting to see how the Bryan Cave tools would be applied. If Squire Sanders is like most other firms, I suspect that margins could be improved by systematically analyzing the business and adjusting staffing, rates, leverage, etc. Bryan Cave appears to be the legal market BI leader and any combined firm would likely benefit significantly from the tools and mindset Bryan Cave has developed.

For more on business intelligence at Bryan Cave, see another good article by John Alber. In ERPs or Data Warehouses for Law Firms? (published in LLRX), Alber addresses the question “whether the benefits of ERP outweigh the costs and risks for law firms” and answers it no.

The article provides a rich analysis of Enterprise Resource Planning systems and explains why simpler solutions - data warehouses - are better. This article is probably outside the comfort zone of many practicing lawyers. For lawyers who manage firms, however, it’s critical reading, not just because of costly technology implications, but also because of the insight it provides to the strategic imperative driving BI.

Udpate of 8/3/06: law.com reports that Merger Talks Between Bryan Cave and Squire Sanders Fizzle Out

Those who need to understand a dense contract should consider special software to create a hyperlinked version. I recently spoke with the founders of Affinitext, a service that converts mega-contracts into easy-to-navigate, on-screen documents. 

Founders Ed Adams and Graham Thomson have extensive experience - law and business - dealing with contracts for major project such as dam or highway construction. Their service converts multi-volume, cross-referenced contracts into a set of hyperlinked documents. Delivery is on CD to serve managers and lawyers on-the-go or in remote locations without connectivity.

Many users will take comfort in the Affinitext interface, which is the same format as Windows on-screen help. Converted contracts have many links - from document to document and back to definitions - as well as “mouse over” pop-ups with explanations.

Dense and deeply cross-referenced contracts create barriers to reading, much less understanding. Affinitext appears to lower significantly these barriers. This is especially useful for anyone just coming up to speed on a project. For projects in dispute, the side using the tool might gain a significant advantage.

My previous posts about improving contract management focused on managing high-volume contracts. Affinitext, in contrast, targets complex documents and may also be effective on simpler ones as well. The only arguably similar product I know is Thomson-Elite’s DealProof.

A forward-thinking law firm that works on dense contracts might consider giving clients an Affinitext version. Absorbing the cost might pay back in client satisfaction. Moreover, clients who regularly consult contracts might call firms more often for follow-on advice – at the usual billable rate.

When a large law firm rolls out new software, how can it measure success? Do firms even ask this question? Reader feedback is welcome. 

As CIO at a large law firm, I deployed a portal. We bought separate tracking software to measure and analyze portal usage. I was surprised that tracking was not built in – I assumed all firms would want to measure usage. Hits to the firm directory and some other administrative information were very high (there was no other way to get it); but otherwise, after one year, use was pretty low. Recent conversations as both a consultant and participant at professional events suggest that tracking is still not common.

This topic arises because I wrote a case study (to be published soon) of RealPractice at Littler Mendelson as part of my affiliation with Practice Technologies. My analysis of growth in and frequency of lawyer usage of RealPractice at Littler looks good to me but a friend asks how it compares to other roll-outs.

Great question! I’m not sure if anyone has good comparative data; consider some examples:
- Mandatory systems (e.g., document management) say little because lawyers have no choice.
- Highly specialized practice applications say little because usage is inherently limited.
- Anecdotes suggest that CRM uptake is low, though the intent was for widespread usage.
- I suspect Lexis and Westlaw took over a decade or two to achieve current usage rates.

Can anyone share data on lawyer usage after rolling out software available to all lawyers? OK, maybe you don’t have data. So then let me ask: what percentage use do you think reflects a good result after two years? Would 25% shock you – and if so, in which direction! How about 50%?

Though motivated by this case study, the question is of broader interest. Click here to comment publicly or click here to reply privately by e-mail. I will not use e-mail answers for any purpose without explicit permission.

A Texas lawyer who runs a business saved 90% of legal fees by sending legal research offshore. 

A Smaller Legal World in the Fulton County Daily Reporter (12/13/05) reports that a lawyer running a telemedicine company paid local Texas counsel $250,000 for multi-state research. Subsequently, he turned to a legal research company in India and saved 90%.

The article also reports that Forrester Research found that 12,000 legal jobs moved offshore last year. excited utterances and I maintain list of legal outsourcing companies. It is not comprehensive (for example, we do not include digital dictation), but I still have a hard time understanding where the 12,000 jobs are. I suspect that litigation support coding is one of the highest volume offshore activities; but coding jobs moved offshore years ago and it’s not clear the numbers have grown much recently. I am curious how Forrester came up with this number. The rest of the article has a balanced discussion of the potential ethical risks of sending legal work offshore.

It will be interesting to watch the market evolve. If more firms and clients gain comfort in offshoring aspects of legal work, that might open the door wider to outsourcing law firm and law department technology services as well.

EDDix provides objective, in-depth research about the e-discovery market. Its latest study, Corporate Litigation Readiness, presents several interesting findings. 

EDDix reports are typically based on research conceived, executed, and analyzed by EDDix. Here, an e-discovery vendor commissioned a detailed survey of in-house counsel and turned over the results to EDDix to analyze. Working from a less-than-perfect research instrument, EDDix nonetheless teased out interesting findings:

• Corporate focus on compliance will cause companies to acquire archival/retention systems that ultimately handle more aspects of e-discovery. And corporations will play a bigger role in setting e-discovery strategy. EDD vendors will need to re-focus the services they offer. But the process will likely take a full decade.
• For the moment, however, the data suggest that many general counsels still do not have a handle on electronic discovery details. The survey found that 62% have an “e-mail archiving system.” Would that it were so. EDDix points out that many technology surveys find that the penetration of e-mail archive systems is under 30%. The interpretation: in-house counsel may be confused about the systems their companies use and their capabilities for e-discovery. But compliance and risk managers will likely take the lead role, so it doesn’t really matter that much.
• Fear of sanctions, despite the widely publicized Zubulake and Morgan Stanley decisions, is not driving change in corporations; rather, it is compliance mandates, particularly SOX. This drive will ultimately lead corporations to adopt enterprise content management systems.

More information on the Corporate Litigation Readiness: free summary for members, which requires free registration; full-study costs $798 for members and $1450 for non-members.

Offshoring “is moving up the food chain” reports Kevin G. Hall of Knight Ridder Newspapers in More complex jobs moving offshore. 

Tax, public relations, architecture, and high-end research are all examples of functions where companies are seeking help in India and elsewhere offshore according to the article. Robert Reich, President Clinton’s labor secretary, is quoted: “Any professional service that can be boiled down to predictable steps, even if they are complicated steps, is now exportable to South Asia.”

Law firms - and clients - should take note that cost is not the only reason to send work overseas. The article reports on a survey by the American Institute of Architects. It found that among architecture firms that sent work offshore, “a quarter cited lower costs, another quarter cited faster production and 50 percent… said offshoring helped them cover peak demand, allowing round-the-clock work on projects.”

The article also discusses the legal market, quoting me about the recent AmLaw survey that found 6% of AmLaw 200 firms have sent work offshore and citing Mindcrest for the document drafting and legal research services it provides.

Reich’s predictable but complex steps may well describe large scale discovery document review. Let’s hope that firms deploying 10s or 100s of contract lawyers have routinized the review process through documentation and quality control. If not, they have an inherent problem. If so, can anyone say software and/or India?

Lawyers are increasingly mobile - technology lets them work from almost anywhere. I suggested in The Future Law Office: Going Virtual that lawyers could sometimes work at home or in satellite offices. Law firms would save on rent and lawyers would save commute time. Two recent articles offer another look at this topic - and reinforce my conclusion that law firms should continue experimenting with working virtually. 

The Business Week Take

From The Easiest Commute Of All (sub-titled “the ranks of remote workers are swelling as companies see the sense in freeing them) in Business Week (Dec 12, 2005, $):

“More and more, the creative class is becoming post-geographic. Location-independent. Office-agnostic. Demographers and futurists call this trend the rise of ‘the distributed workforce.’ Distributed workers are those who have no permanent office at their companies, preferring to work in home offices, cafes, airport lounges, high school stadium bleachers, client conference rooms… At Sun Microsystems Inc., nearly 50% of employees can work from home, cafes, drop-in centers, a company office, or some combination thereof - saving the company $300 million in real estate costs… Today, every knowledge worker has the tools to work from pretty much anywhere: a laptop, a mobile phone, and global, high-speed Internet access that is becoming as ubiquitous as pay phones used to be. Teams are increasingly transnational, warming undersea cables with Net meetings, conference calls, and collaborative projects involving large, far-flung groups. Increasingly, no one is sure of where anyone else is anymore; what’s amazing is how little it appears to matter… Sun says its virtual workers are 15% more productive than their office-tethered brethren”

The Davenport Take in Optimize Magazine

Business Week raves about working virtually, supporting my arguments and then some. A more sober analysis appears in the August issue of Optimze Magazine in Thomas Davenport’s excellent article on Rethinking The Mobile Workforce.  

Davenport writes that “many pioneering companies have retreated from the virtual-office concept” for several reasons: it is hard to monitor and control workers; virtual workers feel career-stymied; lack of access to on-site resources; and cultural issues. My article recognizes such limits and suggests being virtual only a day or two per week. Davenport reports, however, that “[e]ven if mobile work is done only occasionally, there’s reason to be concerned about its implications for social systems within organizations.” Essentially, there is no substitute for personal contact with workmates. That said, he proposes steps to manage occasional virtual work and recognizes the need for experimenting (something I stressed in my article) and measuring results.

Conclusions

If Davenport is right about social networking, then firms must think more carefully about who sits where and how lawyers work across offices and time zones. I can’t figure out how to apply his reasoning to multi-office law firms where professionals regularly form teams across offices and with clients and co-counsel.

So I come out closer to the Business Week view and think that law firm managers should actively consider virtual work. Of course, I may be somewhat biased. As a legal technology consultant, I often work virtually, as I did for two software companies. But when I look at my friends, many of whom do work virtually, and at the ever increasing cost of and time for commuting, it seems inevitable that more lawyers will work virtually, at least on some days.

Many knowledge management professionals say that KM is 80% process and 20% technology. Perhaps true but if honored, requires often unrealistic cultural changes. A new article about work at Morrison & Foerster illustrates how applying modern software creatively can achieve important KM goals. 

IT @ Morrison & Foerster: Lessons Learned from Retail (free registration required) in Law Technology News (December 2005) describes how MoFo provides “relevant search results in a fast and easy way.” Three key insights drove the work at the firm:
1. Attorneys need context to use precedents
2. Attorneys use precedents to find experienced lawyers
3. Attorneys demand simple and relevant systems

To meet these needs, the firm wanted a system to “identify hidden and explicit contextual information from multiple sources and automatically make inferences..” MoFo selected a federated search system and supports drawing valuable inferences by collecting more detailed information about matters and by profiling documents automatically.

Oz has demonstrated this system to other large law firms and the consensus is that this is one of the most innovative approaches today. (I am not disinterested however because I helped Oz Benamram, the practice resources attorney at MoFo, write this article.)

Do lawyers think carefully enough about how they practice law? 

I think not. Relatively few lawyers seem to analyze how they practice. How many carefully consider alternatives or consciously seek best practices? Do others share my impression that relatively few lawyers seem to apply the discipline they bring to representing clients to the way they manage cases and practice, especially applying technology?

Comments welcome: public (posted to this blog) or private (to me by e-mail)

The American Lawyer surveyed the AmLaw 200 firms (see Law Firm Leaders: Conservatively Optimistic). Lots of interesting information on the state of Biglaw; I’ll focus on offshoring. 

The article notes that “Firms embrace temp workers – at least domestically. Seventy-seven percent of respondents said their firms are using contract lawyers or plan to do so. But just 6 percent said they currently offshore work to a foreign country or plan to do so.”

Just 6%?? About 150 firms responded, so that means at least 10 Amlaw firms are offshoring legal work. That’s more than I would have guessed.