When crafting this post, I was considering a number of different topics that are relevant to legal operations professionals. From eDiscovery to contract management to aligning value for allocation of resources, I thought about all the current projects we’re working on with our clients and how I could tie that all together. Read more
The news is full of predictions for change in the business of legal services. Disruptive technologies, new entrants to the market, demand for legal process improvement, and ensuring that data integrity and security are solid are all important issues but detract from the main driver. The lack of perceived value derived for the consumers of legal services is the driving force. With the rise of the legal operations function within corporate legal departments and the subsequent demand for receiving more value and innovation from their outside counsel, optimizing the delivery of legal services has become the main focus. This is a big shift in the driving force for change within the profession as most all prior drivers have been largely cost based. Since litigation, investigations, and review work (discovery, contracts, and due diligence) are the largest bucket of legal work performed within most organizations, applying the optimization approach to these areas can produce significant savings in cost and time spent. With market pressures and a decade of procurement measures pushing the cost for discovery services to a low ebb, the need for process improvement is that much more important. That said, this is more than just adopting new technology to automate certain tasks or solving for lowest cost option. Much of the ethos of legal services and their delivery is changing to a value-based mindset that focuses on easier access and collaboration while providing the needed improvements in process to optimize results.
THE MOST EXPENSIVE EYEBALLS
Richard Susskind, OBE FRSE, has long been a proponent of the transformation of the legal profession to increase value and access to justice. In a commentary on this topic for Harvard Law School (https://thepractice.law.harvard.edu/article/speakers-corner-richard-susskind/), he calls for “the ‘decomposition’ of legal work into component tasks, the more routine and repetitive of which should be undertaken in ways that are much more efficient than the methods of traditional, one-to-one consultative advisers who handcraft and charge by the hour.” This breaking down of legal tasks into a matrix based on risk, cost, and complexity leads us into a world of insourcing, outsourcing, and computerizing the process-based and more administrative work clients are no longer willing to pay to be done by more traditional and higher cost means. Basically, optimizing the legal function to reduce the need for the most expensive eyeballs on all tasks and freeing up their time for the more complex, higher risk matters. Though many efficiency measures are considered in this approach, the most recent Chief Legal Officer survey by industry experts Altman Weil has shown that outsourcing to non-law firm vendors has produced the biggest impact: The top four items named in the survey are all resource realignment efforts that follow the approach advocated by Susskind. All have produced the results desired with somewhat mixed results from using temporary or contract workers. Note that the knowledge and metrics-based initiatives, as well as process improvement, have also shown early success, but it is just too soon to tell the full impact.
THE PRICE OF LIGHT
AC Nielsen, founder of the global information measurement company of the same name, said that “the price of light is cheaper than the cost of darkness”. Analytics, machine learning, artificial intelligence, and knowledge management are all tools and disciplines now being applied to the legal profession to gain more insight on deriving more value by learning from the past while also making better decisions in the future. The same have also been harnessed to automate routine, predictable, low risk tasks to further the impact. As corporations look to drive efficiencies across their operations, they are employing these tools to help take more control of their internal legal processes in lieu of deploying more personnel. The 3rd Annual Analytics Survey conducted by the Coalition of Technology Resources for Lawyers (CTRL), partnered with The Information Governance Initiative (IGI), surveyed corporate in-house counsel to determine how they use data analytics in eDiscovery, Information Governance (IG), and other disciplines. The clear majority of respondents said that data analytics will be “will be very important, will be considered indispensable, and [their] use will be widespread” among the legal profession over the next 10 years.
Due to the large volumes of data involved, analytics in eDiscovery continues to lead the way with “95% of practitioners indicating that their spending in this area will grow or stay level.” Additionally, three times as many organizations indicate they will “start using analytics for eDiscovery in the next 12 months.” Other use cases for analytics are showing increased usage rates, with massive growth in Outcome Analysis (up 42% over last year), Information Governance (up 78%), and Contract Review (up 146%). A detailed infographic with more detail on the usage and use cases can be found here: http://ctrlinitiative.com/wp-content/uploads/2018/02/11097-IGI-CTRL-Infographic.png Not surprisingly, culling irrelevant and non-responsive data is still the top use of analytics for eDiscovery but true early case assessment (ECA) has gained in popularity as has the use of analytics to speed up the privilege review process. Beyond putting the most relevant data in front of reviewers, analytics and machine learning also reduce the volume of people needed while increasing throughput. A two-year study of over 10,000 cases by a leading review platform developer found that the use of analytics allowed reviewers to code nearly 3 times as many documents and the review team size was 36% smaller than those not using analytics. Defending a legal position, making better “go/no go” decisions, learning more about case facts and key people earlier, and arguing proportionality are all made more impactful by knowing what is inside your data through analytics. Use of related data insights are now becoming more common, too. For example, many companies and their outside counsel are now performing “information governance screens” on their data to determine the source, age of the data, and volume then comparing this to records retention schedules and legal hold periods to determine how much data should have been disposed of prior to the legal hold being enacted. These insights into upstream information governance help inform where to focus for defensible disposition initiatives. Sensitive data screens can similarly be done to help control leakage.
CONTROL YOUR DATA’S DESTINY
One of the more important movements in legal operations is the push toward centralization of data or, at the very least, getting closer to the sources of data to reduce the messy handoffs in discovery and to gain more insight. Centralization when under control and direction of the company also helps in the data security functions, defensible disposition, and compliance. Borrowing from the environmental movement, centralization of data also allows us to “reduce, reuse, and recycle” much more readily. A litigation repository, especially one grouped by custodian, provides more insight into your data patterns such as most active custodians, which have the largest data volumes, and more. Single sourcing significantly reduces the need to continuously collect data from the same sources over and over. Reusing decisions in addition to reusing data furthers the savings in time and cost. Applying decisions from past cases, especially for privilege, reduces the need to look at the same data again. Creating a “privilege bank” with a master database of the data and previous privilege decisions makes that process even easier. Other decisions and data can be recycled to spot trends across cases, yielding additional insights that may help tie to outside counsel selection by matter area, budgeting, and more. Process improvement is now being applied to discovery in the form of standardized workflows, protocols, playbooks, and level setting with reviewers and outside counsel. This produces more consistent results while also ensuring better quality control and predictability in outcomes.
PUTTING IT ALL TOGETHER
Through a legal process optimization approach and judicious use of outsourcing, insourcing, and technology assistance, we can significantly improve the value delivered from legal services. While doing so, apply these basic ideas in addition to those outlined above:
• Move beyond pricing focus to a process focus
• Don’t automate bad processes
• If it doesn’t make a difference, why even do it?
• Innovation is a team sport
The Guru (aka: Doug Kaminski)
Today we’re talking with Doug Kaminski, EVP of Cobra Legal Solutions and a veteran of legal industry conferences spanning over two decades, about the recent Corporate Legal Operations Consortium (CLOC) Annual Conference in Las Vegas.
What did you think about the educational sessions at CLOC2019?
Having been to almost every legal conference out there, I can honestly say that I’m impressed with the depth and quality of the educational content at CLOC. Unlike some of the conferences early this year, the sessions have fresh content that’s delivered in a meaningful way by thought
leaders and high-caliber practitioners from in-house legal teams and legal service providers. The topics were well thought out and timely, full of information and best practices that attendees wanted to hear. I was in a number of sessions that were standing room only despite having ample space…not something I’ve seen at other conferences. What struck me the most was the lively engagement with the attendees that sometimes became spirited debates. To me, that’s a sure sign that the content is excellent and thought provoking. I was part of many conversations after sessions that carried on the themes and discussions, both with the speakers and between fellow attendees. We all hope to come away from professional conferences with good ideas and maybe a new perspective or two, and, in my opinion, CLOC delivers on that.
After attending CLOC, what do you see for the industry? What is in store for in-house/outside counsel, corporations and law firms in the short term and the long term?
I think that the legal profession is at an interesting inflection point. I’m seeing signs from some legal operations managers that their approach and initiatives have now gone beyond what I call LegalOps version 1.0, mainly legal spend reduction based on procurement controls and measures. Those who have graduated from pricing exercises to true process improvement are focusing on value creation and optimizing all their resources for the legal services required. Looking ahead, both short and long term, I think we’ll see more collaboration between those requiring legal services and their supply chain. I characterize the delivery of legal services as a supply chain as this value orientation looks at all the possible resources to meet the needs, whether insourced, outsourced via traditional means, automated, or through newer legal service providers. As legal operations managers seek to optimize their processes to derive higher value, they will naturally source from whichever resource helps them accomplish this.
What is your approach to “sales” at a conference like CLOC? How do you get people to pay attention to Cobra when there are so many providers vying for the potential clients’ attention?
At this stage in the evolution of legal operations, there’s a tremendous need and desire for sharing knowledge and, frankly, blowing up old ideas related to the delivery of legal services if those ideas no longer meet the value goals of the modern legal department. As such, there’s a lot of analysis and process mapping taking place to identify the best ways to perform legal service-related tasks. This means that a LOT of conversations are taking place between legal operations managers and their peers, with providers, with subject matter experts, with counsel, and with outside consultants. I’m fortunate that I’ve been a part of many of these conversations in various roles over the years, so I’ve been able to add perspective for legal operations managers, validate assumptions or point out gaps, connect them with peers, and help them navigate and prioritize their value optimization initiatives. This has allowed me to go well beyond the usual service provider focus of “X dollars for Y services” to one of true collaboration with our clients to leave their processes better than when we began. In other words, I think that the sales role at a provider like Cobra Legal is far more about helping clients solve problems than it is merely growing top-line revenue. When you approach a conference like CLOC with that type of mindset, you get excited about meeting with people who are trying to re-engineer their legal processes because you know you can probably help them or, at the very least, point them in the right direction. I look forward to many more conversations with potential clients for that reason because Cobra Legal can make a difference and, in the process, help the overall profession mature and grow.