Strategic Legal Technology

I recently recommended the College of Law Practice Management’s InnovAction publication (PDF). In addition to several feature articles about innovation, there are several informative short case studies. 

I contributed case studies of innovation at Bryan Cave and Morrison Foerster. John Alber of Bryan Cave provided the information for that firm’s innovative use of business intelligence software. Oz Benamram of MoFo co-authored the case study on his firm’s creation of the AnswerBase knowledge management system. These two are available at prismlegal.com here (HTML).

Other case studies include:
- Blank Rome: mentoring and interactive training
- Bowman & Brooke: mobile technology trial kits
- Law Chambers of Nicholas Critelli: space design customized to functional needs
- DLA Piper Rudnick Gray Cary: Venture Pipeline, to help start-up companies
- Halleland Lewis Nilan & Johnson: cultural re-alignment to foster team work
- Holland & Hart: innovative community service that also builds teams
- Pinsent Masons: OutLaw.com, to help start-up businesses
- Simpson Grierson: marketing campaign that changed perception of the firm
- Sughrue Mion: mock trials in Asia help establish its market position
- Wragge & Co: fee prediction and transaction management system

Not really. The title refers to the growth of BigLaw marketing relative to IT. 

I was surprised to read Larry Bodine’s blog post More Marketers for Lawyers at Big Firms reporting that among the top 100 law firms, one marketing person serves 26 lawyers (a ratio of 26:1). One recent survey (unpublished) of 33 large law firms found that the average support ratio for IT staff is 11:1. The IT ratio has been steady for some time while the marketing ratio has grown.

Managers widely perceive that marketing can boost revenue, which probably explains its growth. IT can also grow revenues - see my post KM - The Right Question? proposing that CIOs analyze projects through the prism of which contribute to top line growth. For example, IT-driven projects such as relationship discovery or work force allocation systems can grow revenues.

Law firms should consistently assess how spending contributes - or not - to profits. Assuming that marketing does and IT does not is irrational. Of course, CIOs can help by presenting their budget and plans in a way that makes clear that infrastructure costs are not optional and other budget items can enhance revenue.

PCs are great productivity tools - except when unexplained problems become time sinks, many of which in my personal experience arise from Microsoft. 

After reading recently in e-week and elsewhere about security problems in Office applications, I decided it was time to update my Office suite with Microsoft’s latest patches. (I last updated Office about 3 months ago; I have updates to my operating system set to run automatically but not for Office.) I ran the Office update from the Microsoft Update site. After re-starting Outlook, retrieving e-mail generated an error, as did trying to view my e-mail accounts. The pop-up box suggested there was a registry problem I should fix or do a re-install.

I ran a registry clean-up tool to no avail so I had to uninstall Office and re-install from disk. Things seem ok for now, but of course I face the quandry that if I try to upgrade with all the MS patches, will I end up with the same problem?

I’ve mentioned several productivity tips here before, but this is the dark underbelly of working with PCs. Being my own IT department, I sometimes spend way too much time fixing problems that should just not occur. I don’t do anything unusual with my PC; I keep it current and follow “good PC hygience” rules. Too bad I can’t bill Microsoft for the wasted time!

In this round-up: a report on legal innovation, law library survey, enterprise RSS update, IT outsourcing, and EED udpates. 

Innovation in the Legal Market
Adam Smith, Esq. has an excellent blog post about innovation in the legal market. The Financial Times on “Legal Innovators 2006″ has a good summary and analysis of an article by and awards from the FT for legal innovations in the UK.

Law Libraries
Law Librarians Look Beyond Books in the American Lawyer (July 2006) presents the results of ALM’s law librarian survey. If you thought law librarians were an endangered species, think again, with library functions, budgets, and billability all growing.

RSS
Over at LawLibTech, Cindy Chick has two good posts on enterprise RSS. In Newsgator - Deliver News to Your Enterprise (7/14/06), she describes developments in delivering information enterprise wide via RSS and a news aggregator. In RSS Feeds for Current Awareness, Cindy provides an update on legal publishers’ adoption of RSS for current awareness.

IT Outsourcing - Offshoring
The McKinsey Quarterly (July 2006), in Moving IT infrastructure labor offshore, discusses the theme that “offshoring of IT infrastructure—machines and networks and the people who manage them—has been relatively slow to develop. But this is changing as leaders show how to offshore it effectively and vendors step up to meet a growing opportunity.” This is important reading for BigLaw CIOs who want to stay current on technology offshoring trends.

E-Discovery (EED)
In December 2005 I posted about the problem of near duplicates in large document collections and suggested that Equivio, a then new software solution, was promising. Equivio continues to penetrate the EED market and has partnered with numerous e-discovery players. Lawyers and litigation support professionals facing reviews of large document sets should be sure that they have a good strategy to deal with near duplicates.

Are Litigators Ready for the New Meet-and-Confer Sessions? (NLJ, 7/25/06) has a good overview of the pending Federal discovery rules changes slated for December.

The Business Review of Albany, NY reports in Xerox finalizes Amici purchase; opens its litigation services division in Albany (7/28/06) that “Now that Xerox has completed its $174 million acquisition of Amici LLC of Albany, its new unit, Xerox Litigation Services will begin offering electronic discovery and records management products.” Xerox joins at least one other Fortune 500 company (EMC) as a player in the ever-growing EED space.

Does Your EDD Provider Make House Calls? in law.com (8/15/06) discusses the growing impact of EU privacy and company IP concerns on processing data in discovery.

What’s my knowledge management strategy? That’s a good question but a better one is “what’s best for the firm?” 

KM is mainly about reducing lawyer effort. That’s a good goal. Better still is to improve profitability, focusing on projects, technologies, staff, or processes that can grow revenues. Maybe it’s KM. Or maybe it’s a new business intake process, improved work force allocation, a proposal generator for marketing, or relationship discovery software.

I expand on this premise in Pragmatic Approaches to KM, published on August 17, 2006 by LLRX.com (also here at prismlegal.com). It’s based on a presentation I gave at the May 2006 Interwoven Legal IT Leadership Summit, a conference that brings together leading IT leaders from large firms to discuss pressing issues and develop actionable strategies.

The article reviews the current state of KM and trend toward automated approaches and proposes an analytic framework for firms to use in considering what projects to pursue. That framework compares “Reduced Effort” and “Enhanced Revenue” in a scatter-gram (where circles proportional to costs represent projects), as illustrated in the chart below. While it may be hard actually to measure effort saved, revenue generated, and costs incurred, the framework seems the right way to think about where to devote resources. (Contact me if you want the spreadsheet that generated this; it’s not automated and assumes you know Excel but has some instructions.)

There’s a great new publication out on innovation in the legal market. 

The College of Law Practice Management (of which I’m a trustee) released today an “e-zine” about legal market innovation (PDF). I’ve not had time to read it yet but saw some articles in draft and contributed a couple myself, so I know this will be a good read.

Creating this was a very significant undertaking. Many contributed but I want personally to thank Jordan Furlong, editor of the National (the flagship publication of the Canadian Bar Association) for being the editor-in-chief. Regular readers of this blog will recognize several contributors, including David Maister, Bruce MacEwen (aka Adam Smith, Esq.), and Dennis Kennedy among many others.

This publication is part of the College’s InnovAction program, which we will re-launch in connection with our annual meeting in September. Eric Mankin, whom I’ve recently referenced several times, will be our keynote speaker on the topic of Innovation.

With this post, I have also started a new blog category called Innovation and Change Management.

Goodbye Law Office Computing magazine. 

I have subscribed to Law Office Computing magazine for some time. On Tuesday (8/15/06), I received a letter from Small Firm Business magazine, an ALM publication, stating that ”Law Office Computing will no longer be published after the June/July issue.”

I will miss LOC. Though it appeared targeted more toward small- and medium-sized law firms, I found its news and features of interest, even with my BigLaw focus. The May/June issue of Small Firm Business that came with the announcement letter and which is offered as a substitute looks nice, but it’s not technology focused.

The LOC website makes no mention of its seeming demise. But the James Publishing, Inc. web site, publisher of LOC, no longer lists LOC.

Leading large organizations is hard. Being a new leader in a partnership is especially hard. Law firm strategist and management consultant Patrick McKenna offers an excellent short guide for new managing partners at law firms. 

McKenna’s First 100 Days is a step-by-step guide for new managing partners. This is a good read for BigLaw CIOs and technology managers who want to understand more about how law firms operate, especially when leadership changes. (The link is to an e-book of sorts; I found it hard to read on-screen, even on my 19″ monitor, so I had to print it.)

Though the guide is excellent, I was disappointed that McKenna did not suggest that a new managing partner spend time talking to staff. Fortunately, in the additional 10 pages of comments from current and former managing partners, many emphasize the importance of including staff in transition planning.

Law firms are less hierarchical than corporations but are caste systems - you’re either a lawyer or you’re not. This topic warrants a longer piece someday, but the bottom line is that the caste system is detrimental to lawyers, staff, and clients. BigLaw will be better off when it overcomes this pernicious mindset.

It’s a nice change of pace to talk about a topic instead of write about it. Last week I had the pleasure of participating in a great disussion of both legal technology, including outsourcing. 

Bob Ambrogi and J. Craig Williams host the weekly Legal Talk Network’s Coast to Coast program. In Legal Technology: A Double Edged Sword? (overview page with link to streaming MP3), Bob and Craig interview fellow legal technology consultant Ross Kodner of Microlaw and me.

In the 30-minute program, we covered the impact of technology on jobs in law firms, the current state of outsourcing and offshoring, the relative decline in the focus on hardware in favor of software and business requirements, among other topics.

Of course I’m not disinterested, but I think it’s a good program. I also think that BigLaw should consider this converational format for some substantive updates. Many conference sessions I’ve organized in the last couple of years have been panels and participating in Legal Talk Radio persuades me that the medium is a good way to communicate.

IBM announced today that it will acquire Enterprise Content Management vendor FileNet. Over time, this could change the EED landscape. 

Enterprise content management, which increasingly includes records management, is becoming the arena of major corporations. (For example, see my blog post about CA acquiring MDY.) As big companies gain control over the life cycle and storage locations of their information, the e-discovery landscape is sure to change. Exactly how, however, remains to be seen but I suspect pure e-discovery providers, especially those focused on collecting and processing data, will eventually have to develop new offerings to thrive and grow.

The American Lawyer today reports that a Software Glitch May Have Erased E-Mail Text in Enron Suits. 

Quoting from the article:

“The company [Applied Discovery] handling electronic document production in the Enron civil suits says a software bug may have erased text in e-mails produced for discovery in the case over an 18-month span…. lawyers handling the Enron litigation said it was too early to predict the potential impact. … The e-mail bug delivers messages with only the subject lines and sender information intact, but does not capture the body text of the e-mail. … Nagel [of Applied Discovery] described the problem as “a Microsoft issue.” He said the problem is not e-discovery specific, meaning that anyone who uses an unpatched version of Microsoft Outlook 2003 to open a type of file called a .PST from Microsoft Outlook 2000 might find that the e-mail opens blank…. Craig Ball, a computer forensics and electronic discovery consultant… said he is surprised to learn that a market-leading company like Applied would use Microsoft Outlook to search e-mail. He said Outlook is good about opening files, but inaccurate when it comes to searching file content and is limited in its ability to do Boolean and other searches.”

The entire article is worth reading. Time will tell if this problem could easily have been avoided or reflects inadequate care. Meanwhile, it’s a good lesson that litigators and lit supp managers should make sure the tools they use work appropriately. For those who might think “time to return to reliance on humans,” remember that people on balance make more mistakes than machines.

This development may usher in a new age where not understanding how critical tools work is unacceptable. If so, the question still remains how much you need to know and investigate and what the appropriate standard is or will be.

Thanks to Monica Bay over at the Common Scold for pointing this out and sharing the news.

Update: See the August 16, 2006 Common Scold blog post reporting on law firm Bartlitt Beck’s letter concerning the above.

Update: See the August 11, 2006 LexisNexis response here. I came across this via a Google search; I did not find a link to this on the L-N site. See also, however, a L-N letter and a response by Craig Ball, both at the Common Scold blog.

When a client walks into your BigLaw office, how do you know if she’s not really a mystery shopper? 

That’s not a question you’ll likely hear anytime soon. But if you were a doctor, you might. Health Care Taps ‘Mystery Shoppers’ in the Wall Street Journal (8/8/06, $) reports that health-care, which “has never been noted for its customer service,” in the face of raising competition, is “increasingly looking for ways to improve the patient experience. Some are turning to mystery-shopping services… which send employees to pose as customers and later report back on how they were treated.” Many doctors and hospitals have been very happy with the results and made significant improvements based on what they learned.

As I wrote in Who’s Failing: Clients or Law Firms? yesterday, the legal market needs external prods to innovate and improve. Mystery shopping probably won’t work because it’s transactional focused (for example, a single doctor’s visit or overnight hospital stay).

Law clients do, however, have ways to get “consumer” feedback. One approach is lawyer-rating service LawDragon (see my post, New Lawyer Rating Service). Another is to share information informally among other in-house lawyers.

And BigLaw can conduct client surveys to learn what their clients think. (See Client Feedback Programs in the premier issue of the US edition of Managing Partner Magazine, June/July 2006, for how to conduct client surveys.)

BigLaw CIOs should welcome any lawyer feeback. As a legal technology consultant, perhaps I’m biased, but I suspect that a lawyer’s use of technology significantly influences the service a client experiences.

There are other ways for BigLaw to get feedback, albeit more informally. I had lunch with a BigLaw partner firm this week. As a friend, I pointed out that the one book or magazine in reception contained media coverage of the firm and the the most recent item was 3 years old and many were 6 years old. Maybe I’m different than clients, but I suggested this sends a bad signal.

Surveys and articles suggest that many general counsels are unhappy with outside counsel. Perhaps GCs need to hold up the mirror to find the answer to the problem. 

In my recent post Looking for Law Firm Innovation, I reported on Eric Mankin’s research documenting the lack of legal market innovation. Today, Eric has another of his insightful updates (Prospects for Legal Innovations) that examines why there is so little innovation in the legal market. The bottom line: innovation is rare because clients don’t demand it.

In previous blog posts (“Procuring” Outside Counsel and Technology, Glass Half Full or Half Empty?, Call to Arms for GC: Force Your Outside Lawyers to Avoid the Mistake Doctors Make) I suggested that if GCs don’t create pressure for better service delivery, then perhaps CEOs, CFOs, or procurement officers will. I’m still waiting.

For BigLaw CIOs, it’s important to understand the overall business environment and potential constraints on innovative ideas they have. If you’ve ever felt like you are pushing on strings, this helps explains why.

The e-discovery market continues to grow explosively and evolve. Who are the leaders in service, software, and by stage of e-discovery? 

The fourth annual Socha-Gelbman E-Discovery Survey answers these and other important e-discovery market questions. A summary of the results is at Socha Consulting. Here are some highlights:
- The EED market continues to grow at 35+%
- The top 5 e-discovery providers are Fios, Kroll Ontrack, LexisNexis Applied Discovery, Renew, and Zantz (top 20 listed)
- Among the top 20, there is (as covered in two separate tables) significant variation in
     . experience, capacity, and law firm ranking
     . capability by stage of e-discovery processing
- The top 10 e-discovery providers include both some “new generation” players such as Attenex and some long-standing players such as Summation and Concordance.

For law firms evaluating service providers and software, this is a useful resource (purchase information here).

For me, the big surprise is that there are still so many players in a market that is not that large ($1.3 billion in 2005). I suspect that there is still room for significant additional consolidation (see my list of recent consolidations).