Strategic Legal Technology

“EMC Corporation, the world leader in information management and storage, today introduced the EMC eDiscovery Solution, an integrated offering of EMC information and content management software, networked storage and professional services designed to help customers of all sizes better manage the legal discovery process.” [emphasis added] 

So opens a February 27th EMC press release (spotted on Lit Support Blog). EDDix recently predicted a convergence of archival/retention systems with e-discovery solutions (details here). EMC reports that it is the first “storage company to deliver an integrated solution for proactive e-discovery.” It seems EMC is positioning itself to be a turnkey storage, archival, and e-discovery solution for corporate America, including professional services.

Corporations may now face an interesting choice: deploy a single, integrated system or assemble a best-of-breed solution. A huge consideration: the biggest e-discovery cost is typically lawyer review time. A best-of-breed approach with the right advanced search tool might yield a lower total cost. But even if that is true, many companies will likely find the integrated solution attractive. In any event, it probably would not be very hard for EMC to integrate other tools into its solution - and the company has made numerous acquisitions over the last few years.

Certainly this is news for law departments and corporations. But it is also news for law firms, which should closely track the evolution in how their clients manage information.

Yesterday I reported on the Ark KM conference last week. One participant was Jack Vinson, a KM expert not from the legal market. Via his Knowledge Jolt blog, Jack provides two good reports on the conference. 

In his report on conference day one, Jack highlights some comments that caught his attention:

- “Lawyers don’t really collaborate. They happen to work on a file at the same time.”
- KM is about the stuff in the crevices, where technology doesn’t fit.
- There is no single solution that will solve all KM-related needs. Again, another familiar refrain, but it was interesting to hear in context.
- “Why can’t it work like Google?” in response to focus groups. This is a familiar refrain everywhere.
- What is the “return on investment” from the perspective of the lawyer? If they provide information, does the system give it back “with interest?” I see this as a very strong link to the personal perspective of What’s In It For Me?
- How do I take the knowledge and improve business?

Highlights of his day two report:

“Day 2 of KM in the Modern Law Firm is over, and it seemed to have more energy, even amidst the normal outflux of people catching flights or responding to calls… There was much debate around the idea that KM was becoming common-enough that it is just one of the things firms do to support the practice of law. On the other hand, not all firms treat the concept of practice support in the same way, and KM might be something other than supporting the practice. One of the balancing acts in the discussion was the tension that firms feel between delivering content and delivering a capability…
The last session was an entertaining brainstorming session… [with the goal of coming up] with ‘radical’ ideas for developing a client-facing KM solution…. [my vote goes] to the suggested creation of a Automatic Resolution Tool that would work from the existing litigation decision trees and build to a more sophisticated tool to help close the lawsuit.”

Last week Joshua Fireman and I co-chaired the Ark Group conference, Knowledge Management for the Modern Law Firm (PDF of program). The theme we set for 70+ participants over two days was “what is KM, what is not, and where are its boundaries?” 

The session KM Beyond Document Management covered many themes: financial reporting systems for partners; analyzing process flows to enhance the value of interactions between lawyers and clients; associate care and feeding; tracking external developments; automatic classification and entity extraction; the pressure on PSLs to work on professional development and marketing; portals versus Outlook as the primary interface; and the problem that marketing, finance, and KM are silos. What I found interesting is that much of what we discussed is not traditionally in the realm of KM.

The session Is KM Morphing into Practice Support Consulting, which I moderated (my outline of questions), was a lively discussion about KM boundaries. Some argued KM is just one of many aspects of practice support (the majority it seemed to me), others that it must remain a separate discipline. There was more consensus that, either way, a critical success factor is developing a close working relationship with lawyers.

Some other interesting points from this session:

• The tensions and trade-off between a functional focus on a KM or Practice Support department versus a practice focus. I likened this to an issue many companies struggle with – product versus market or customer focus.
• The group spent a bit of time discussing the relatively simple challenge of helping lawyers with basic firm operations such as scheduling conference rooms or knowing whom in HR to contact. The point is that if lawyers struggle with such basics, it may be hard to move up the chain to KM or other practice enhancements.
• A panelist suggested a concierge, someone who could answer any question. A participant suggested that lawyers want psychic computers, ones that anticipate needs. This humorous comment illustrates the tough question of how easy is easy enough?
• The need for KM and practice support professionals to initiate project and improvements but the frequent and often inevitable slide to reactive mode.

All in all, I conclude that KM is indeed morphing, at least among US firms. Whether it subsumes practice support or is absorbed by other departments remains to be seen.

Day one of Knowledge Management for the Modern Law Firm conference was excellent. Reports and materials to follow but in the mean time, haiku. 

Joshua Fireman and I co-chair the conference and for the day one wrap up, we asked participants to submit a surprising insight, valuable lesson, or unanswered question. We had many great responses, but the most unusual were two haikus (anonymous) - the first KM ones I’ve seen:

Hidden wisdom pearls
Scattered throughout firm silos
KM seeks to find

KM dirty word
But we do it anyway
Useful nuggets sought

Update (2/25/06): original haiku corrected (above); haiku from comments promoted to main text:

Talking to clients
Not talking to each other
Talking in the dark
               - Simon Chester

Wisdom moves in light
Knowing touch is most profound
Clumsy bears break stuff
               - Andy Havens

Notes to participants (Updated 2/27/06):
1. Matter Centricity presentation - ppt download
2. Is KM Morphing to Practice Support Consulting? discussion outline
3. Making KM Client Facing - ppt download
4. We discussed the impact of practice group management. A couple of us mentioned Susan Raridon Lambreth as a leading thinker on this topic. Her recent book is Achieving Peak Performance Through Practice Management. Chapter 9, is “Knowledge Management and the Use of Technology” by Sally Gonzalez.

Two years ago I suggested in a Marketplace Trial that “a financial market to value and hedge law suits” could emerge. Hedge funds are on edge of making that happen. 

Hedge Funds Find Returns in Making Small Loans in the New York Times (2/21/06, $) explains that hedge funds seek returns in new and seemingly unusual markets. Several funds are financing businesses that lend cash to injured people. The collateral - pending personal injury suits. One lawyer is helping a client who is “preparing to start hedge funds that will invest in class-action lawsuits and precious coins.” Lawsuits and coins?? Exactly. From Wall Street’s perspective, lawsuits may be like any other financial asset.

An active market in lawsuits could drive legal technology. If Wall Street invests, you can bet that they have consultants, analysts, and financiers analyzing the cases. That can propel data collection, early case assessment, business intelligence and supporting technologies. Hedge funds may even care how much it costs to litigate, so they could be a disruptive event that forces firms to become more efficient.

Lawyers dislike change. They resist the new, whether it’s an application upgrade or submitting time by deadline. Firms must be creative about change management. 

Another good example is customer relationship management software (CRM). Many law firm managers say “CRM is the most widely licensed but least used software in large firms.”

Firms hope CRM will provide central contact tracking; some aspire to actual relationship management. But most fail with both. The barriers include not wanting to share contacts, no time to enter data, and “nothing in it for me.”

Some firms, however, do succeed where others fail. For example, Sutherland Asbill is serious about CRM. One key element is a champion. Gail Hageman is a full-time marketing technology specialist and, more importantly, she’s been at the firm a while and has long-standing relationships with many lawyers.

Sutherland also provides incentives. They required lawyers to enter contacts in the CRM to obtain client holiday cards. Lawyers wanted cards, so they began sharing contacts. The firm wanted to track business development. They required describing prospect meetings in the CRM before reimbursing expenses. Lawyers wanted their money, so they started putting information in the system.

Hageman reports that the combination of institutional will and specific actions has achieved high lawyer compliance with the CRM - and provided the firm with a very valuable resource for its marketing efforts.

Last fall I wrote about an effort to form a new national knowledge management group. The group now exists as the KM peer network of the International Legal Technology Association (ITLA). 

Here is the ILTA announcement circulated late last week:

“We are happy to announce our new KM Peer Group, a topical peer group established to focus specifically on legal knowledge management. Though informal regional groups meet in major metropolitan areas such as DC, NYC, LA and Toronto, no other formally organized group exists to support legal KM professionals.

Many colleagues, particularly those in areas with no regional legal KM groups, felt there was a need to connect with other like-minded professionals in order to learn from, and network with, each other. For those firms that have not yet established a full-time KM role, a “national” KM group could also provide a forum to learn more about legal KM and how to apply it within their firms.

Goals & Benefits
So what is the KM Peer Group’s mission and what are our goals this year? One of our first goals is to create an understanding of KM as it relates to the legal environment. KM encompasses all aspects of knowledge within organizations through the analysis of business processes including: knowledge creation, documentation, codification, sharing, and how these activities promote innovation, learning, effectiveness, and profitability. Examples of knowledge repositories in law firms include: libraries of model and sample documents and information about the expertise and experience of attorneys and practice groups; and profiles of matters, clients and industries. These repositories typically require a strong cultural, business process, and technological support infrastructures.

With this in mind we hope to offer:

• Educational programs - to provide learning and training opportunities throughout the year including case studies and vendor demos
• Networking opportunities - to allow members to learn from each other, whether they are seasoned KM professionals or just getting started
• Meeting at ILTA&\’s Annual Conference - to facilitate an understanding of KM information resources and how to incorporate information resources into work processes
• Directory of members and a listserv with archives - to allow members to participate in discussions and stay in touch between webinars and the annual meeting
• Articles in ILTA’s publications - to provide information to a wide audience on an array of KM topics, ranging from primers to more in-depth themes.

As we are getting underway, the steering committee would appreciate feedback from all members and disciplines. I encourage you to contact me or anyone on the committee with ideas and questions. Subscribe (or have the KM specialists in your firm subscribe) to our listserv from http://lists.iltanet.org/read/all_forums/subscribe?name=ilta-km

Stay tuned for more details in the coming months - we look forward to an exciting year!

/s/ [The Steering Committee - see below]”

To the best of my knowledge, the the listserv is available only to ILTA members. Here are the steering committee members:
-Catherine Monte, Peer Group VP, Fox Rothschild (contact: cmonte at foxrothschild com)
-Nina Platt, Faegre & Benson
-Nola Van Huy, Alston & Bird
-Chris Boyd, Wilson Sonsini
-Lisa Kellar, Hunton & Williams
-Janis Croft, Nixon Peabody
-Dave Hambourger, Winston & Strawn
-John Szekeres, Cleary Gottlieb

Update (2/21/06): 1. FAQ about peer group now available. 2. The KM listserv is for ILTA members only.

A newly published survey suggests that the e-discovery market is consolidating. 

Growth Curve, the AmLaw Tech column in the February 2006 issue of American Lawyer Magazine, presents the e-discovery portion of the results of a recent survey administered in connection with the Litigation Department of the Year article in the January issue. The magazine surveyed 81 litigation department chiefs at large law firms. They asked about e-discovery vendors, scanning and coding vendors, and software used to manage discovery documents and cases.

“[T]he industry fragmentation that we spoke of [2 years ago] appears to be waning.” The article points out that 2 years ago, 24% of respondents listed Kroll as their primary EED provider; this time 46% did. It also quotes me as saying “It is more efficient to have a few big players than to have many smaller ones. A larger vendor can offer more capacity, higher quality, faster turnaround.”

Consistent with other recent surveys, this one finds among the top five e-discovery vendors - all with mentions by more than 20% of respondents - are Kroll, Applied Discovery, EED, and Fios.

Judge Richard Posner has an interesting take on what will drive (so to speak) law firms to allow lawyers to work virtually. 

I have suggested that law firms experiment with virtual work (e.g., Working Virtually Revisited) and written about related topics (e.g., Where Should In-House Counsel Sit? and Collaboration Re-Considered).

In the Becker-Posner blog, Judge Posner considers the seemingly intractable question of traffic congestion and getting drivers off the road. He concludes that

“until traffic congestion gets significantly worse, little will be done, and perhaps little should be done, to try to reduce it. But I am not pessimistic. In the long run what will reduce traffic congestion will be the continued digital revolution, which will not only increase the amount of telecommuting but also lead to a substantial substitution of virtual for face-to-face interactions in business, shopping, and even socializing. The business district of the future and the mall of the future may be located in cyberspace.”

The judge notes that high-speed Internet access allows him to work at home much more now than when he became a judge 24 years ago.

US legal trade press coverage of knowledge management seems to have declined in the last few years. In Canada, by contrast…. . 

The National is the magazine of the Canadian Bar Association. Knowledge Uprising by Patti Ryan in the Jan/Feb 2006 issue (flash or PDF - I found the PDF version easier to read) offers an in-depth look at current issues in KM. This coverage may well reflect greater interest in KM in Canada than the US. It is worth reading for any KM professional.

I recently reported that only 49% of large law firms have someone in charge of KM (knowledge management). What’s the deal? I’ll ask a panel that question at an upcoming KM conference. 

The Ark Group’s “Knowledge Management for the Modern Law Firm” conference is on February 22-23 in NYC (details at excited utterances). Joshua Fireman of ii3 and I co-chair it.

I moderate a session called Is KM Morphing into Practice Support Consulting? with Dave Hambourger (Technology Partner, Winston & Strawn), Jim Lantonio (Executive Director, Milbank Tweed), and Eugene Stein (Chief Knowledge and Technology Officer, White & Case).

We’ll explore whether KM is/should remain a separate domain or if large law firms should focus more on practice support, which can include KM. I planned this session before ILTA released its ILTA staffing survey. It reports that 250+ lawyer-firms have about 3% of IT staff focused on KM. In contrast, they have 12% on practice support and almost 20% on application development and administration. That means almost 1/3 of IT staff that could focus on anything from lit supp and basic apps to pretty interesting and advanced practice support consulting.

Given the percent split between KM and practice support + apps, we’re not just talking semantics. KM v. a broader vision is key to what staff deliver to lawyers, appropriate skills and experience, and reporting structures.

The Ark conference will be small and I expect a good dialog not only with panelists, but also participants. I hope to answer some of these questions here after the session.

Well-known management consultant Rees Morrison suggests that law departments Keep your lawyers on the same floor! Is that right? 

Morrison cites a Harvard Business Review article that finds “employees who work on different floors interact 50% less than those who work on the same floor.” It’s even worse for folks in different buildings.

I don’t agree with his conclusion that companies should keep their lawyers on the same floor. If proximity matters so much, then inhouse lawyers should sit near key clients.

More importantly, companies must overcome the geographic bias. I’ve thought a lot about working virtually (article, update blog post). Granted, there is no substitute for in-person interaction. But with so many articles about “marketing as a conversation with customers” and about letting your customers innovate for you, isn’t it time for lawyers to join the rest of the world in collaborating virtually?

Well, after three intense days, Legal Tech is over. This annual gathering seems to grow every year. Here then are my observations. 

I spent most of my time with clients and in one-on-one meetings. So I can’t offer the first-hand report I had hoped. For a good summary, see David Munn’s LegalTech.com Blog reports (here and here).

My private conversations support David’s observation that MS SharePoint has rapidly gained mindshare. David also reports that e-discovery is everywhere (suggesting that the “elevator index” I proposed in my prior post is, not surprisingly, going up).

Indeed, EDD was everywhere: ads on the floor (how do they stick those plastic “billboards” on the floor?); ads in the program; in the elevator. Even ads in the men’s restrooms - on the walls as one entered, above the urinals, even on the mirrors. Not sure that’s where I’d want my product featured, but it was memorable.

From one-on-one conversations, it’s clear that large law firms have serious planning underway for portals, document management upgrades, and significant KM undertakings.

I’d say that the change is incremental; I did not notice anything revolutionary. Yet unlike some years past, there is no sense of stagnation. It’s not the dot-com era (thankfully), but excitement is back.

Update (2/6/06): Jim Calloway over at Law Practice Tips Blog has a good Legal Tech report.