The drive among law firms to raise client service levels and offer flexible pricing models is behind a new wave of innovation in the use of business intelligence (BI) in litigation support. To make the most effective build/buy decision for e-discovery document review, for example, firms must apply the optimal mix of in-house resources and outsourced work to effectively meet the objectives for every client and case. Effective use of metrics takes the guesswork out of e-discovery planning, helping counsel and clients make realistic business plans and better control legal spend.
Corporate Legal Challenges and Trends
General counsel or chief legal officers (CLOs) increasingly play a strategic role in advising board decisions, proactively managing information governance and compliance, and managing legal risk. As in-house legal teams assume greater responsibility for their dockets and remove that authority from their outside counsel, they need to find faster ways to improve data transparency to support decisions. Just as their own corporations implement innovative IT solutions to manage business more effectively, many CLOs are taking on the role of change agent, innovating with technology solutions in legal operations.
The flexible, high-performance legal operations they envision require a data-driven approach to decision-making, increasing demand for more complete solutions from law firms and other service providers. Corporate legal goals include greater use of technology tools, collection and analysis of management metrics, and project management training. In a recent study by the 451 Group on the use of BI and analytics in the legal profession, 74% of respondents expressed a wish for a visual view of key metrics in e-discovery. However, less than half of those surveyed report that they are currently using automated reports or dashboards.
Law Firm Business Model Challenges and Trends
Law firms face similar pressures from their clients, demanding greater innovation and flexibility in business processes. Traditional hourly billing models are changing in response to demands for greater transparency of legal costs, and negotiated fixed, flat or task-based fees. The challenge for the firm is to manage the mix of resources—from partners and associates to paralegals and litigation support staff—and capture activity and cost data effectively so that it can be analyzed to track performance to KPIs (key performance indicators) and to support decisions on staffing, budgeting, service offerings and pricing.
Most firms report that data is in separate silos. Disparate systems hold financial data, budgets, case information, and e-discovery project management activity. This hampers the ability to provide meaningful real-time information to attorneys and project managers. In fact, 63% of law firms responding to the 451 survey said that reports on e-discovery KPIs are created manually by analysts or paralegals, who gather raw data from various silo systems and compile it in a spreadsheet—a cumbersome and expensive use of resources. Fewer corporations report using manual processes to report on e-discovery, likely because they are relying on outside counsel to provide that information.
Given these goals for increased innovation and data-driven operations, the growth in adoption of BI solutions in legal management is accelerating.
What is Business Intelligence, and How Can it Solve these Challenges?
Corporate and legal respondents described BI as “a technology-driven process supported by actionable data to make data-driven decisions.”
While BI has wide potential across corporations and law firms, let’s focus on litigation and e-discovery. In that realm, BI is a process of leveraging technology to synthesize data from disparate sources to answer questions about project status, document processing, review accuracy, and other case metrics. An e-discovery dashboard might, for example, automatically gather and analyze metrics from a document review application, the law firm financial application, and a project management platform in Salesforce, to display a graphical view of real-time status on a document review project, displaying user and service details, progress of ESI collections, review status, document productions, and legal spend.
Beyond the metrics of a particular case, BI allows law firms to compare a portfolio of cases and their relative productivity and cost. BI data on the activity and cost of billable attorneys, motions, depositions, e-discovery hosting and review, and project management hours can help identify opportunities to improve client service and close efficiency gaps.
BI puts Actionable Information in the Right Hands
A dashboard provides insight into information that is not readily available in an easily consumable format by aggregating databases, triangulating data points and summarizing an array of records to generate reports. For example, a pricing calculator focused on spending offers more than raw financial figures. A pie chart tracking the amount of time users spend on each matter can reveal staffing or training gaps in a single glance. Consolidating a vast amount of data into a consumable metric, graphic or indicator is key to raising user satisfaction levels, both in law firms and corporate legal teams who are responsible for decisions on case strategy, staffing, workflows, and budgets.
Data and Dashboard Best Practices
A successful dashboard implementation requires careful discussion and planning with the participation of groups across the organization who will use the dashboard. Focus these early discussions on the current reports and information they have now, the business purpose of each, and respective strengths and weaknesses. Expert business users should also participate in the development, testing, deployment and training phases of the project. Shamir Colloff, CTO at e-discovery provider FRONTEO has managed a number of e-discovery dashboard implementation projects. He offers these tips for success:
- Centralize data with a single discovery provider to optimize utilization. Those using a variety of vendors receive random reports and erratic tracking, rather than seamless support.
- Customize your data with a dashboard designed specifically to address the questions to which you want answers. An inclusive dataset behind the dashboard will allow for addition or changes to the display as needs change.
- Translate your data so it is portable, downloadable and even mobile. While few end-users will access the technology directly, every member of the legal team will want to review summaries of its contents in PDF or Excel, as well as on a wide variety of devices.
- Interact with your data by manipulating its contents for planning and budgeting.
- Integrate your data by importing information from different systems within your organization. With files typically stored in a myriad of systems, it is imperative to integrate and access them on a universal scale.
The Business Benefits of BI Dashboards in a Litigation Practice
Early adopters of e-discovery dashboards report improvements in workflow efficiency and reduced cost, including faster, better information for clients and for firm management, and direct savings as a result of monitoring software license management.
A national law firm implemented an e-discovery dashboard, and found that the new system delivers information in an easily consumable form, raising the understanding of litigation and e-discovery operations on the part of partners and practice managers, and allowing them to make informed decisions on staffing, forecasting, budgeting, and case strategy assessments – enhancing the value proposition to their corporate counsel clients. As an added bonus, law firms often find that metrics on data volumes in collected databases help them deliver valuable guidance to clients in the areas of information governance, data retention, and litigation readiness.