Overview
New developments in legal technology are transforming the way corporate legal departments approach the law and manage their legal operations. At the same time, outside counsels are using technology to differentiate their legal service. In the process, new technologies are creating opportunities, as well as high expectations, for corporate counsel to drive down legal costs, while simultaneously optimizing resources to drive increased operating efficiencies and potential revenue-enhancing innovation.
Technology is Transforming the Practice of Law
- New, advanced search technology fueled by artificial intelligence
- Powerful, easy-to-use mobile computing devices
- Sharing legal research between in-house and outside counsel in real time
- Video technology for face-to-face, desktop-to-desktop counsel
These are just a few examples of new digital technology advancements that are becoming part of the daily fabric in the legal workplace. These technologies are transforming the way attorneys conduct work and communicate within and outside of their organizations.
As corporate legal departments, like many other non-revenue-generating divisions, are challenged by the business to cut costs and establish higher efficiencies, new technologies are arriving almost daily to help general counsel meet those demands. These powerful new technologies offer corporate legal departments the opportunity to reduce internal and external legal research costs, obtain concrete information faster and communicate more efficiently. All good news when you're being forced to reduce budgets, maintain head count and achieve savings for the company.
According to the findings of the 2011 In-House Tech Survey, an emerging trend is "law departments letting firms know that certain technologies and providers need to be used. Nearly a third of survey respondents say they have asked outside firms to address specific tech concerns in their RFPs. And 19 percent said they've stopped using an outside firm because of technology-related issues. In a way, this isn't surprising: Technology is an area - like travel expenses, billable hours and research - where costs can be controlled. And with the right tools, it can be leveraged to better understand and manage legal fees. ("Facing the Future in the 2011 In-House Tech Survey", Law Technology News, 6/22/11).
While controlling costs and driving efficiencies are paramount to corporate legal departments, investing in new legal technology cannot be adopted based on these two goals alone. Technology must enhance the practice of law - supporting the role of the attorney in offering wiser counsel to the business - as well as the satisfaction in working. When investing in new legal technology, these goals must remain at the forefront:
- Improving work product quality while reducing costs;
- Increasing the satisfaction of the client and lawyers;
- Enhancing efficiency;
- Minimizing risk exposure;
- Maintaining confidentiality and security;
- Supporting mobile and flexible work arrangements;
- Achieving high levels of knowledge capture and sharing; and
- Measuring value and metrics for success.
New Advancements in Legal Research Leads to Cost Savings and Increased Confidence
The evolution of legal research and efficiency
Over the past few decades, legal research has evolved from print research to online research. With both types, the goal is the same: to find the relevant primary law in the right jurisdiction and to use secondary sources to leverage the prior analysis of others.
The legal industry saw a dramatic leap forward in the area of legal research with the launch of WestlawNext, a powerful new search engine, in February of 2010. The modern search engine applies advanced search technology from the fields of artificial intelligence, data mining, and natural language processing to the 140-year collection of editorial enhancements to the law available through the Key Number System.
This new technology enables the researcher to run one search across thousands of content types, rather than running multiple searches in different databases. As a result, the researcher has a better understanding of the law and identifies additional sources that otherwise might not have been found. Further, filtering functions allow the researcher to hone in on jurisdiction, judge or content type, as well as specific terms.
The search engine also addresses the issue of language variety. With Boolean searching or literal search engines, the burden is on the researcher to know all of the terms to describe the particular legal concept or fact pattern in the jurisdiction. The syntax often varies widely and thus, the researcher runs multiple searches to identify all the terms that may be used. The cost of re-running searches due to language and in additional content types results in unforeseen legal research costs.
The new search engine has the ability to significantly lower legal costs by reducing the time to conduct research, while simultaneously increasing a corporate legal department's confidence that it, or its law firm counsel, has identified the most relevant information. Results of a study conducted by the Legal Research Center show that attorneys using the new technology successfully completed assignments 64 percent faster. The study involved parallel performance of 100 attorneys conducting identical legal research assignments using both the new technology and its predecessor.
In practice, these efficiencies and improved process management would benefit the corporate law department with lower research costs, better research results and enhanced value.
Cost Savings for In-House Counsel
Increased efficiency has significant benefits to the corporate law department. This means researchers can complete research at least twice as fast, or deliver more value in the same amount of time. The law department can answer questions in-house, as opposed to moving whole complex matters outside. Even removing one percent of total outside counsel fees provides significant savings to the company. These savings stem from in-house legal departments' newfound ability to reallocate resources, avoid duplicative research, and improve operational efficiencies.
Controlling Outside Counsel Costs
In-house counsel will realize even greater savings if their outside counsel is using technologies to improve productivity and efficiency. The efficiency allows outside counsel to spend less time "finding the law" and focus on high-value work (developing arguments, meeting with the client, internal strategizing) - the work that matters most to the client. The reduction of legal research time can be a direct cost savings to the client and can free up time for the attorney to create more value-based work in the same amount of time. The efficiency and improved productivity enables outside counsel to provide alternative fee structures as a way to address the expense-management initiatives of their corporate clients and drives value-based billing.
Connecting Research to Value
While sharing documents in other applications is common (such as in a document management system), the ability to share documents as part of the research workflow drives even more efficiencies and makes knowledge management a fluid and organic process. Folder sharing technology facilitates and encourages law departments to collaborate on research and enables all members to leverage the collective knowledge of their entire organization. This significantly increases productivity and improves efficiency.
For a law department, this means the most knowledgeable lawyers in the organization can easily share their expertise. For law departments who are considering knowledge management ("KM") initiatives, supra, folder sharing enables researchers to make KM a part of their workflow while conducting their research. A law firm also realizes these same benefits, in addition to significant time savings in research projects, which equate to lower costs passed on to the corporate client. The client is not billed for "reinventing the wheel" or duplicative research by others on the research team; the firm provides better results to their clients by leveraging prior research and drives value in the legal research process. In addition, innovations such as adding notes to documents and highlighting within the document as part of the research workflow save valuable time and ensure better organization of documents, both of which directly impact the bottom line.
Sharing research between in-house and outside counsel provides significant benefits in connecting legal services to value. With folder sharing technology, the research and accompanying citations are automatically updated in real time; therefore, in-house and outside counsel are able to share information in a timely and efficient manner and ensure that work is being handled properly. This saves photocopying and scanning costs, as well as delays with mail or email. Most importantly, stronger partnerships and trust are created through transparency in the legal research process. If a law department is exploring how to organize research collections, folder sharing offers a solution that is integrated within the research.
To realize the benefits of folder sharing within and outside of an organization, research should be organized by practice area, projects or issue. This creates a dynamic categorization system that can be used by others, even after a researcher may have left an organization. The ability to search these folders provides an additional lever for improving productivity. This is far superior to research saved in email management systems, which do not provide the same search functionality as folder sharing technology.
In an effort to control legal costs and deliver value, outside counsel are supporting these types of initiatives and are leveraging their libraries to avoid billing a client for research that has been previously conducted. These folders are knowledge collections that can be leveraged to drive efficiencies for both parties, creating mutually beneficial savings through lower costs and enhanced value.
Going Mobile
Mobile communications technology such as smartphones, the iPad and e-readers are not only dramatically changing the day-to-day lives of people of all ages worldwide, but also changing how legal practitioners communicate, access information and present ideas, from the boardroom to the courtroom. Nearly 65 percent of in-house lawyers use mobile devices in lieu of laptops while traveling, according to a recent survey. The 2011 ABA Technology Survey suggests that around 300,000 U.S. lawyers use an iPhone and about 130,000 use an iPad. (iPhone J.D, 7/11/2011)
To compete in this changing economy, the leading legal research providers are developing adaptable and intuitive research capabilities designed to work well on all smartphones and mobile devices, such as the iPad. As technology evolves, so does the way in which attorneys and legal professionals gather their information - and when. Mobile devices provide the flexibility to work wherever you are, on any device you choose, and at any time. No longer do attorneys need to return to the office to email a case to another attorney. In the courtroom, attorneys can prepare an entire presentation using mobile technologies and apps.
Thus, mobile technology largely eliminates the need to bring supporting attorneys to trial, or for that matter, boxes of supporting hard-copy documents. This translates to savings for the corporate client because they are not being billed for the additional legal staffing or the cost of document production. "Lawyers who don't use Internet applications in order to increase their productivity are overbilling their clients, no different than if they were using embers to scratch out documents on a flat rock." ("Best iPad Apps for Lawyers," The Greatest American Lawyer, 6/13/11)
A key component to using mobile technology is whether the technology can synchronize across devices. This ensures that productivity and efficiency are being maximized. When evaluating mobile technology, ask:
- Does the application allow me seamless access to my mobile, tablet device and PC?
- Does the application facilitate robust searching and filtering capability over vast content collections?
- Does the application support the ability to add notes and highlighting to content?
- Does the application support one-click access to frequently used content, favorites and research history?
- Does the application allow offline access to documents?
- Does the application provide full synchronization of legal research content between all devices?
- How does the application integrate with other technologies such as litigation software solutions and tools?
- Does the application allow for organization and collaboration using personalized folders?
Adding Value; Knowledge Management
The availability of new legal technology means corporate legal departments must partner with corporate information technology departments to identify the best technology, determine return on investment and maintain new technology with IT support. Investments in legal technology lead to broader questions about how the corporate legal department, along with other traditional non-revenue-generating functions within a business, continue to add value to the corporation.
From a business perspective, as the corporate legal department drives down costs and increases operating efficiencies with the aid of new legal technology, the value shifts to a higher, strategic level. The next step in the value equation is knowledge management. Lawyers have always understood the value of the information and experience gleaned from client engagements, i.e., "knowledge management." The goal of knowledge management is to ensure that the right information is in the right hands at the right time, leading to better decisions about legal strategy and the business direction of the firm.
As a practical matter, KM within a firm may involve systematic efforts to capture work product and learning as well as methods to retrieve and share that knowledge. KM principles also can be used to streamline support functions and enhance information sharing across administrative departments, reducing wasted time spent on fruitless searching or duplication of effort. As legal knowledge is optimized across an organization, no longer is the corporate legal department seen within an organization as a barrier to innovation. Rather, it's viewed as an internal source that can spur business development, while at the same time helping an organization drive down expenses by identifying and reducing risks.
Likewise, as law firms shift their focus from being a provider of legal services (a vendor mentality) to being in the knowledge business, they can increase their value to their corporate legal department clients. Law firms that reorganize themselves around how to capture, share and reuse knowledge help their clients see what is different in each matter rather than what is the same - and that's the point. Clients don't want to keep paying for the same research all the time - that which they could do themselves - but instead are looking to their outside counsel for that which is different, or what they've missed. Law firms that connect their knowledge management platform with their legal research technology will obtain the powerful new dynamic that clients need and desire.
Conclusion
Transformation of legal practices and processes within the corporate legal department through the use of new legal research technology offers the potential to innovate processes and to identify potential revenue-generating opportunities. As innovations in legal research technology are embraced by both corporate legal departments and law firms, transformation moves up the value chain to a point of optimization. The corporate legal department then becomes an innovator within the business, serving as a catalyst to revenue generation that drives the company.
Legal research technology and knowledge management allow corporate legal departments to redesign the way they operate. Workflows, once focused on incremental improvements, are repositioned to better align the corporate legal department with business strategy. This new world of flexibility frees up the resources and knowledge management of corporate legal departments to get closer to other functions within the business.
From a very practical view, embracing modern legal technology helps business leaders look beyond the hardware and software to when and where they can access legal search systems from their iPads, and even the cloud. Legal technology allows the corporate legal department to work as one with the business to generate the intelligence, and subsequently the wisdom, to allow business leaders to transform their business and grow despite the current economic climate.
Additional Resources
- WeslawNext Efficiency Study, Thomson Reuters (2011)
- Westlaw Webinars, Thomson Reuters (2011)
- Westlaw Knowledge Management, Thomson Reuters (2011)
- Corporate Counsel Blog, Thomson Reuters (2011)
- Report of the Task Force on the Future of the Legal Profession, New York State Bar Association (2011)
- 2011 Client Advisory, Hildebrandt Baker Robbins and Citi Private Bank (2010)
- Serengeti Benchmarking Survey, Serengeti (2010)
