What Blockchain Can Teach Legal About Service Models

John Alber believes that law firms are headed to extinction. Drawing from patterns in nature, he sees similar patterns in law firms. He is concerned that there are very few inflection points at which law firms can adapt sufficiently to lead change. He suggests that knowledge management professionals can find a path to useful change by learning from the example of blockchain.

  • John Alber, Practical Futurist, Intitute for the Future of Law Practice.
  • A detailed session description is at the end of this post.

[These are my notes from the 2018 Ark Group Conference: Knowledge Management in the Legal Profession.  Since I’m publishing them as soon as possible after the end of a session, they may contain the occasional typographical or grammatical error.  Please excuse those. To the extent I’ve made any editorial comments, I’ve shown those in brackets.]

NOTES:

  • How serious is the Extinction possibility?
    • Looking at nature, we see that species die but sometimes leave behind elements that can give rise to new species. In the law, practices evolve and die. Sometimes they die but leave behind elements that can spawn a new practice. Often they die before they can be replaced by vibrant new practices. Without the option of adaptive practices, law firms will die.
    • Document review used to be the sole preserve of law firms. Now LPOs are taking over that business and there is no obvious substitute business for law firms.
    • A big clue about the potential for extinction — look for ways of doing things that have not materially changed for a long time. In Alber’s view, the legal industry’s approach to contracting is exactly this kind of extinction-ready practice.
  • Nick Szabo:
    • Nick Szabo is an earlier mover in blockchain. He is a computer scientist, legal scholar and cryptographer known for his research in digital contracts and digital currency. (ome believe that he is really Santoshi Nakamoto.)
    • He developed the concept of “smart contracts.” He has analyzed deeply what contracts are, how they work, and how they could optimally be digitized.
    • For him, building contracts on blockchain makes the most sense.
  • Benefits of Blockchain-like Tech for Contracting

    • Institutionless: it does not depend on whether we trust the institution (or law firm) involved. It exists viably separate from specific institutions.
    • Collective: moves away bespoke contracting to contracting by a collective consensus. This leads to less variability and more predictability in the contracting process.
    • Rules-based rather than words-based: this makes it easier to digitize the contracts.
    • Simple: we cannot digitize our contracts without first simplifying them.
  • Peter Drucker Wisdom:
    • “In a period of upheaval, such as the one we are living in, change is the norm. … But unless an organization sees that its task is to lead change, that organization … will not survive.”
    • Law firms are ignoring the fact that they need to lead change in the legal industry. They are too focused on the work of today so they seem to ignore the work of tomorrow.
  • How do we get the necessary skills?
    • Think about design-thinking differently. It is a super-skill to acquire.
      • Take a course, do some reading, get smarter about design-thinking.
    • In his view, design-thinking goes beyond the user interface, it goes beyond making things “pretty”.  Its true value is that it helps us understand more deeply the nature of the problem.
    • Once you have a better understanding of the problem, then work to gain influence in your firm so that you can share your understanding and move the firm toward sensible change.
  • KM Professionals Could be Influential
    • We are interdisciplinary so we have a broader view of the problems and possible solutions.
    • However, we need to move beyond thinking of ourselves experts in library sciences. Otherwise, we will not be able to make an impact on our firms.
    • We cannot afford to be passive.
  • Others are innovating while law firms are largely stagnating
    • There are lots of new legaltech vendors and new legal providers that are innovating technology and processes.
    • They are moving at a much faster pace than law firms are.

 

Session Description:

Blockchain is all the news now in legal. It is said to be transforming trust rela onships in everything from land tles to securities transactions. And smart contracts are the talk of the town. But shouldn’t blockchain also teach us something about what we missed along the way? How we record, transact and enforce agreements has been a constant almost since the inception of the common law. Yet we let the digital age be born and grow to maturity without ever considering that perhaps our paper?bound and extraordinarily inefficient service model for managing agreements might need changing. It took computer scientists to reimagine how to make agreements concerning digital assets. With the digital age exploding around us, what else about the law needs reimagining? Everything?

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Dan Linna: Preparing CIOs for the Law Firm of the Future #ILTACON

Session Description:

Disruptions in the legal industry are putting pressure on law firms to innovate and rethink how they deliver services in order to stay ahead. Learn about the people, processes, and technologies that law firms will need in the not-so-distant future and the measures and behaviors to put in place now to ensure your organization’s success.

Takeaways:

  • Futurist view of law firms and how they will deliver services.
  • Future role of the CIO.
  • People, processes and technologies that will be necessary for the law firm of the future.
  • Behaviors and measures to put in place now to prepare.

Speakers: xx

[These are my notes from the International Legal Technology Association’s 2018 Conference. I’m publishing them as soon as possible after the end of a session, so they may contain the occasional typographical or grammatical error. Please excuse those. To the extent I’ve made any editorial comments, I’ve shown those in brackets.]

NOTES:

  • What will your law firm be doing in 10 years?  This is the first question you need to answer. Then, ask if you are hiring the right people (and training them) to achieve that reality?
    • you will need lawyers with new skills
      • technologically able, process-focused
    • you will also need developers, data scientists, project managers
  • The market. Over the last 10 years, there has been an increase in demand for legal services. However, demand for law firm services has been flat. This is because in-house corporate counsel are keeping more work for themselves and they have become more strategic about how (and from whom) they purchase legal services.
  • New providers. There are a variety of legal service providers. And now, United Lex has merged its professionals with the lawyers of LeClairRyan. These new approach
  • Legal Departments Priorities.
    • controlling outside counsel costs
    • driving work to outside counsel that demonstrate value. (This leads to the erosion of pedigree when what really matters is performance.)
    • Key attributes of winning law firms
      • solutions focus
      • quality of work
      • legal expertise
      • responsiveness
      • cost-efficiency
      • outcome vs expectation
      • low hourly rates counts, but it is the least important of these factors
  • Performance and Quality Matter. Research by AdvanceLaw indicated that on average the AmLaw 21-200 outperform the AmLaw 20.
  • Threats to law firm business. (According to Altman Weil)
    • corporate law departments are in-sourcing legal work
    • client use of technology
    • alternative legal providers
    • alternative law firms
  • Why are so few law firms changing?
    • Partners resist most change effortts
    • Most partners are unaware of what they might do differently
    • We are not in enough economic pain to motivate more significant change
    • clients aren’t asking for it
    • we lack time or organizational capacity
    • our service delivery model is not broken so we’re not trying to fix it
    • other law firms like ours are not changing
  • Legal Services Innovation Index. Catalogs law firm innovation and then index the work done by individual law firms. For more information see: https://www.legaltechinnovation.com/
  • How do you innovate? You need to focus significantly upon sustaining innovation. It’s not just about disruptive innovation
  • Three Types of Innovation (CapGemini):
    • 70% = core innovation
    • 20% = adjacent innovation
    • 10% – transformational innovation
  • Biggest Issues CIOs face today
    • security management
    • aligning IT initiatives with business goals
    • improving IT operations/systems performance
    • cultivating the IT / business partnership
    • cost control/expense management
  • Hurdles to digital transformation (CapGemini)
    • Cultural issues
    • presence of archaic IT systems and applications
    • lack of digital skilss
    • lack of clear leadership vision
  • Law Firm CIOs
    • Must be a strategic leader in your organization
      • how do you manage change?
      • how do you get others to buy into your ideas?
      • how do you lead up, down, across?
    • How do you contribute to a culture of innovation
  • Knowing the business
    • Law firm CIOs must know their clients’ business
      • External clients?
      • Internal clients?
        • Have you spent time developing relationships and rapport with firm lawyers?
        • Have you spent time understanding how they work?
  • Start with technology
    • EVERYONE is a technology company
  • Legal Technology
    • Basic — MS Office, metadata, eDiscovery, cloud computing, case management
    • Intermediate — document automation, expert systems
    • Advanced — machine learning, AI
  • What is artificial intelligence in law (today)?
    • Rules-driven AI  — expert systems, robotic process automation
    • Machine learning — Walmart is using Legalmation (to ingest complaints, draft a response and discovery questions) before engaging outside counsel
  • Why is so much legal work unstructured?
    • lack of standards and best practices
    • lack of metrics, including for qality
    • Why does it matter? You cannot automate chaos!
  • Steve Harman: We need to move legal services from Art to Science. Lawyers need to change from Artisans to Engineers.
  • How to approach this?
    • Focus on Process
      • disaggregate legal work
      • then figure out who is best postioned to deliver that work
      • systematic reengineering of work processes results in over a 50% improvement in performance
  • Toyota’s Improvement Kata
    • get the direction of challenge
    • grasp the current condition
    • ndefine ext target condition
    • experiment / test
  • 21st-Century T-Shaped Lawyer — able to function with the following skills:
    • Business of law
    • process improvement
    • project management
    • knowledge management
    • metrics data analytics
    • technology
  • For information on LegalRnD, check out YouTube.
  • See the Institute for the Future of Law Practice
    • mostly focused on jobs in corporate legal departments
  • What are law firms doing now?
    • some conversations with clients re: budget
    • some conversations about project staffing
    • some management visits to key clients
    • only 20% conduct post-matter reviews with clients
  • Action Items:
    • ask yourself: what will our firm be doing in 10 years?
    • put the client at the center
    • commit to disciplined continuous improvement and innovation
    • become data-driven
    • create a data plan
    • collaborate with clients, vendors, and law schools
    • identify new products & service to provide value to clients
    • go to Gemba! Embrace empathy!
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The Case for Collaboration between Clients and Law Firm KM

In this session, clients speak to the senior law firm knowledge management professionals in the room about KM in client law departments and possible avenues for collaboration with law firms.

[This session is part of a private international gathering of senior BigLaw KM professionals. Because of the private nature of the meeting, these notes are not attributed to any particular speaker. I’m publishing these notes as quickly as possible so please excuse any typographical or other errors.]

Windows into the  Legal Ops World

  • Matter Management
    • for some in-house colleagues, matter management can involve a matter space, for others, it’s all about ebilling.
    • In-house counsel may not have a taxonomy to help organize the matter-related content. (The director of Legal Ops at your client may be glad to have a law firm help with taxonomy or metadata management.)
    • If we could standardize metadata across the entire ecosystem, and push that metadata into the ebilling systems and matter management systems, that would simplify thing enormously for in-house counsel. However, several attendees thought that a universal taxonomy to rule them all was highly unlikely (at least without significant concerted client pressure).
    • Many clients are unaware of the KM assistance that law firms are able AND willing to provide to their clients. One panelist suggested that the firms in the room create a master list of their offerings and then make that list available to the ACC and CLOC.
    • Law firms should not assume that a client’s legal ops director has complete authority to do whatever needs to be done. For some clients, their scope is restricted to ebilling and technology.
    • Law firms would be wise to get ahead of the curve. ACC and CLOC are driving change that you will see very shortly. For example, expect some significant tightening of outside counsel guidelines soon.
    • Having a shared platform between all clients and their law firms would make knowledge sharing much easier. But who would firms and clients trust sufficiently to provide the technology, with requisite security?
    • 10 years ago, the Banking Legal Technology group in London created a shared portal between law firms and clients on HighQ. There were some spikes in usage, but it never rarely gained widespread traction. There is a small handful of banks that use it, but not enough banks do use it on a sustained basis.
    • One of the problems with earlier attempts at this was that the clients wanted access to material in law firm document management systems. However, law firms were prepared to release only their typical type of “client publication” materials on this platform that was visible to other law firms.
    • One participant suggested that a “distributed ledger” approach with shared tokens of trust could be used to create a virtual shared platform.
    • From the in-house perspective, they want outside counsel to offer a service to retrieve the necessary information, not a product.
    • Panelist: The issue is not technology. The issue is that law firms do not really want to share their material PLUS there is no business model to support this sharing.
  • Forms  & Templates
    • the pace of improving/revising legal forms & templates is not fast enough to reflect the speed at which business terms and approaches change.
    • In-house counsel would welcome help from outside counsel on improving the legal terms in client forms and templates.
    • External counsel need to understand better the internal processes at the client regarding how the client updates its own forms and templates
  • Agile Project Management & Change Management
    • One panelist now approaches change in an agile rather than a waterfall way. They focus on producing a minimally viable product rather than the fully developed soup-to-nuts solution.
    • The challenge of change management in-house is that the pace is really fast. Things change radically by quarter and by month. Therefore, outside counsel who want to support their clients must first understand the methodology the client uses and the pace they experience.
    • One law firm is helping a client implement a document management system, including managing the change process.
    • While a law firm’s IT department or KM department may use an agile approach, law firm partners tend to be “anti-agile.” This is a reflection of their great risk aversion. There is a parallel in-house where the in-house lawyers are more risk averse than the business folks.

Collaboration Opportunities

  • The ACC has promoted a Legal Operations Maturity Model that includes law firm collaboration. (See www.acc.com./maturity/)
    • general counsel know ACC and trust it
    • the maturity model creates an early stage, intermediate stage, and mature stage against which legal ops can benchmark themselves.
    • in-house legal departments are using it to help with their strategic planning
    • it includes Legal Ops KM Maturity
      • they are looking for sponsors for their 14 sessions (including webinars)
      • they will launch an RFP process: they are looking for success stories of collaboration between law firms and legal ops teams
  • In the UK, individual clients have been asking their panel of law firms to help them develop in-house thinking and systems.

[Photo Credit: Geralt]

 

 

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Who is Your Client Advocate?

Who is your firm’s client advocate?

(Yes, this is a trick question.)

Many years ago, I had the misfortune of finding myself in the hospital. One of the first questions they asked me was, “What do you do for a living?” When I responded, “I’m a lawyer,” the battle lines were drawn. They raised their defensive shields immediately, which naturally caused me to become extremely curious and highly observant. This, of course, just made them more anxious.

After I asked one too many questions, I was told that I was going to be discharged early. Just before my discharge, a person who called herself a “patient advocate” visited me. I vaguely recall a fairly pleasant person who seemed unable to take my feedback and cause any changes in the hospital’s approach. Coupled with the rest of my experience at their hands, I had no hesitation in telling everyone I met about my bad experiences with that hospital.

This is the wrong kind of word-of-mouth advertising.

Clearly, this was a suboptimal case. But before you start bemoaning the state of American healthcare, ask yourself these questions:

  • “Is there any parallel to client experience with my firm?”
  • “Is anyone in the firm even asking our clients about how they experience our services?”
  • “If they are asking these questions, what are they doing with the answers?
  • “What is changing because of the answers received?”

Now, let’s return to the initial question: “Who is your firm’s client advocate?” If you answered, “The relationship partner,” you fell for the trick. Relationship partners usually are good at staying close to the client, winning work, responding to client queries, managing client teams within the firm, and billing (and collecting!) in a timely manner. As a practical matter, not enough relationship partners have the time, training, or (frankly) nerve to actually walk in their client’s shoes and experience the firm’s service from their client’s perspective. In other words, relationship partners can be more reactive than proactive.

Seth Godin explains the difference between reactive and proactive client service: “Reactive client service waits until something is broken.” Proactive client service anticipates where potential problems might arise and plans ahead to avert or mitigate them. Reactive client service makes the bare minimum changes necessary to pacify clients. Proactive client service holds itself to a higher bar: it creates the conditions that make clients grateful for and vocal about their wonderful relationship with your firm.

So what might a client advocate in your firm do?

  • actively solicit client feedback on their relationship and experience with the firm
  • conduct after-action reviews with firm lawyers and staff to gain a more holistic view of what happened
  • advocate on behalf of clients for new practices and policies that help avert or mitigate negative client experiences
  • work with firm lawyers and staff to embed those new practices and policies in firm workflows

Now, let’s return to the initial question again: “Who is your firm’s client advocate?”

[Photo Credit: Paul Mercuri [Public domain], via Wikimedia Commons]

 

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The Changing Ecosystem of Legal Services

Session Description:  The legal services ecosystem has changed radically since the turn of the century. This session explores those changes and suggests some responses.

[These are my notes from a private gathering of senior knowledge management professionals from large law firms. The meeting attendees come from law firms around the world. The participants in this session include a Big Law CKO, an in-house counsel, a legal services provider, and the founders of two AI companies.]

  • History of the legal profession: Legal services were largely unchanged from the 12th century to the 20th century. We worked much like the old guilds of craftsmen
  • Context Changes:
    • client businesses have grown in scale and complexity, resulting in bigger and more complex legal issues
    • client businesses have become truly global, so multi-jurisdictional issues abound
    • legal issues are more often multi-disciplinary: economics, engineering, accounting, data analysis
    • our privileged position as professionals has eroded
    • technology has changed the way we work, improving speed but not always improving productivity
    • clients have become buyers, so the nature of lawyer-client relationships have changed and costs are the focus
  • How the “legal species” has evolved in response
    • clients have law departments
    • traditional law firms: Big law, Mid law, etc.
    • some law firms now have “second label” firms to deliver legal services differently
    • law firms have spun off consulting shops
    • temporary staffing agencies augment traditional law firm staffing
  • The ecosystem now is more complex
    • in-sourcing = keeping the work inside the client’s law department
    • out-sourcing
    • multi-sourcing = parceling the work out to a variety of providers
    • procurement
    • project/process management
    • cooptition — where competitors work together
    • virtual firms and networks
    • systems thinking
  • What does the legal ecosystem include?
    • living elements
      • clients
      • law firms
      • law schools
      • alternative legal providers
    • non-living elements
      • increasing regulation
      • increasing concern for privacy
  • Trends in the legal ecosystem
    • the emergence of Legal Ops and procurement practices
    • advances in technology
    • law firm substitutes offer traditional and new legal services
    • VC investment in the legal sector
  • Learning from the Travel Industry
    • What drove the changes from one ecosystem to another?
      • automation
      • alternative service providers — lots of startup offering alternative services and alternative ways of doing things
      • enhanced technology
    • What has happened in the travel industry will happen in legal; the pie will be distributed differently
    • These changes are already happening in the legal industry
    • Assume that the changes will happen faster than you expect
    • Google has found ways to automate the resolution of legal issues internally. Fewer issues will be referred to internal and external counsel.
  • Practical Ways to Respond:
    • Gear up — invest in legal operation
      • find and hire experts in operations, information, and technology
      • give them a seat at the table
    • Standardize everything
      • legal playbooks, decision-making processes, customer interactions — all should be standardized
      • fewer decisions should require human interaction or expertise — only the difficult or complex issues
  • The In-House Perspective on these Issues:
    • Our standard office tools (MS Office) do not appropriately manage legal work inside a company or with external clients
    • Centralization and standardization are key:
      • We need a central platform to enable better legal processes
      • How do we work together when we all have proprietary systems with their own logic and processes
    • All information should follow the same data structure
    • Content should be semantically categorized

[Photo Credit: Wikimedia]

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Clients Want an Outside-In Firm

Sometimes everything changes when you look at something from a different angle. Consider a drop of river water: to the naked eye, it looks innocuous enough. However, that same drop of water under a microscope will suddenly appear to be teeming with all sorts of life.

Who knew?

The person who tried a different perspective — that’s who knew.

Consider a professional services firm, perhaps even a law firm. From the perspective of someone who works in the firm, it’s an employer, an institution with a history, a collection of colleagues, a platform for professional successes or failures, a place to shelter from the elements, etc. Sometimes, it can seem almost incidental that it is also an organization that is ostensibly devoted to the service of its clients.

If, however, you take the perspective of the client, what is that professional services firm? It depends on the client and that client’s experience. If that client has had a good experience, this is how that client might describe the firm: a source of useful advice, a partner in problem solving, an indispensable counselor for problem avoidance, etc. If that client has had a bad experience, the picture looks different: a source of delay and aggravation, a frustrating collection of individuals who do not make my job as easy as they should, an expensive part of my budget that I am constantly trying to trim.

For the firm that is serious about meeting client needs, the first step is obvious: make sure you are looking at things through your client’s eyes. To do that properly, you usually have to leave your firm.

What does this mean?

In their book, The Startup Owner’s Manual, Steve Blank and Bob Dorf explain this concept very succinctly: “Get out of the Building!” Why get out of the building? According to Blank and Dorf,

Getting out of the building means acquiring a deep understanding of customer needs and combining that knowledge with incremental and iterative product [and service] development.

A little further in their book they say something that should cut close to home for many of us in professional services firms – just substitute “products and services” for “product” in the following quotation:

Of all the lessons of Customer Development, the importance of getting out of the building and into conversations with your customers is the most critical. Only by moving away from the comforts of your conference room to truly engage with and listen to your customers can you learn in depth about their problems, product features they believe will solve those problems, and the process in their company for recommending, approving and purchasing products. You’ll need these details to build a successful product, articulate your product’s unique differences and propose a compelling reason why your customers should buy it.

To quote Blank and Dorf: “There are no facts inside your building, so get the heck outside…. Facts live outside, where future customers live and work….”  Go where your clients are. Interact with current and future clients in their own habitats. Live in their space, walk in their shoes.

In other words,  become the outside-in firm that clients want.

 

[Photo Credit: Flash Buddy]

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Law Firms — The Final Frontier

leonard_nimoy_william_shatner_star_trek_1968We interrupt our ILTACON blogging to mark a significant occasion in the history of humankind: The 50th anniversary of Star Trek.

This iconic television show premiered on September 8, 1966, and since then has changed the way several generations think about technology and space. In fact, it has changed our lives. According to Elizabeth Howell, several Star Trek technologies that seemed far-fetched when first seen on TV are now an indispensable part of modern life:

  • communicators >> cellphones
  • tricorders >> MRIs
  • tablets
  • global positioning systems

While I am an enthusiastic fan of the franchise, I cannot claim to match Marshall Honorof in his devotion. He has watched every single Star Trek movie and television show. In his account of his personal space odyssey, he makes the following observation about Star Trek:

Something about the show’s optimistic message stuck with me. Technology can improve our lives. We can conquer our deeply held prejudices. There is other life out there, and it is willing to cooperate with us. And, importantly, no matter how far we come as a society, there will always be room for adventurers.

[…]

While it’s not a novel observation, the reason ‘Star Trek’ feels unique, even in a world of more ambitious sci-fi properties like ‘Battlestar Galactica’ and ‘Black Mirror,’ is because it alone asserts that technology will make our lives better, not worse.

So it seems that others have figured out something that eludes too many inhabitants of law firms: technology can make our lives better, not worse. The challenge is whether we can “conquer our deeply held prejudices” and use our Vulcan, Bajoran, and Betazoid abilities to leverage technology to make something better of a woefully underperforming industry. We have underserved clients, unhappy lawyers, and unappreciated allied professionals. Isn’t it time for a change?

Go boldly!

[To learn more, see the great infographic on The Evolution of Star Trek.]

[Photo Credit: Wikipedia]

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Your Clients Want Trilingual Services

foreign dictionaries - guidebooks-1425706-1600x1200Law firms are like professional sports teams in one critical respect: they pay a premium for top talent. Until now, that premium has gone to new graduates with the best grades and lateral lawyers with the best books of business.  Unfortunately, this overly narrow view of talent has been a costly mistake. Instead of focusing on academic pedigree or client numbers alone, firms should be focusing on a specific capability: being trilingual.

While speaking a variety of languages is life enriching, SmartLaw* has clear business reasons for requiring its personnel to speak three specific languages:

  • Law
  • Client
  • Technology

A command of the language of law is the one capability for which law firms have always hired. This one is obvious if you actually want to deliver legal services. However, speaking “legal” is not enough. It equips you to create legal services, but it does not help you do so cost-effectively or in a way that actually connects with clients. That’s where the other two languages come into play.

Speaking “client” means the ability to hear what your client is telling you and to interpret those words from the perspective of that client rather than merely from the perspective of that client’s outside counsel. This empathetic knowledge goes way beyond Google Translate (if, in fact, Google Translate could handle it!) to a deep understanding of the needs and aspirations behind the words. This is a language you learn best by being the client or by walking in the client’s shoes for many miles.

Speaking “technology” means more than just operating digitally. It means understanding the array and logic of the digital resources available. It means an openness to rethinking the way you work so that you can take advantage of the rich possibilities of those digital resources. And, above all, it means being willing to create safe-fail experiments that allow you to try new things as you explore novel ways of working. Without this willingness to experiment, you can never improve and you most certainly will not speak technology well.

It should go without saying that this trilingual capacity is not a requirement limited to lawyers. In a SmartLaw firm, all personnel will be trilingual and respected for it. When everyone in the firm has native ability in these three languages, then your firm is ready for the future of legal services.

*This post is excerpted from HighQ’s ebook: SmartLaw: Expert insights for the future of lawDownload the whole ebook here.

[My thanks to Rick Krzyminski and Richard Robbins for the conversation that led to this article.]

[Photo Credit: Dog Madic]

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Integrating KM into Practice Management #ArkKM

Session Title and Description: The Evolution of Practice Innovation:
Are We Successfully Integrating and Embedding KM within Practice Management Systems?
Law firms continue to re-examine traditional approaches to the practice of law, and along the way many have implemented a wide range of changes that enable firms to deliver client services more efficiently. These innovations touch virtually every aspect of our practice and the way our firms are run. Clearly, KM has not been left behind or subsumed into other support functions. However KM must continue to evolve in step with demands that are reshaping the business of law and redefining service delivery models. This discussion will seek to characterize the foundation of a true practice management platform, as well as the ever- changing issues and challenges that KM is trying to navigate. Is KM the cornerstone of a “post-silo” law firm strategy? Or is practice innovation squarely focused on “Business Intelligence” and financial data points, while missing the context in which KM solutions can be deployed?

Speakers:

Toby Brown, Chief Practice Officer, Akin Gump Strauss Hauer & Feld LLP
Keith Lipman, President, Prosperoware

[These are my notes from the 2015 Ark Group Conference: Knowledge Management in the Legal Profession.  Since I’m publishing them as soon as possible after the end of a session, they may contain the occasional typographical or grammatical error.  Please excuse those. To the extent I’ve made any editorial comments, I’ve shown those in brackets.]

NOTES:

  • What is practice management? Managing matters to achieve client satisfaction and firm profitability.
  • What is the goal? Revenue and Profits!!!  How do we do this? By lowering the cost of delivering services to clients. The answer is not just buying cheaper pencils. It means you need to push work down to the lowest-cost resource within the firm. You need become more efficient in the way you work.
  • What’s the strategy?
    • Few law firm partners are empowered to understand their own contribution to revenue and profits.
    • Far too many law firm partners experience “pro forma surprise.” They do not really know what their matters have generated in terms of maximum billable suntil they see the pro forma. If their team has not billed as much as expected, then their maximum billables are down.
    • You need to know your firm’s profit margin. And you need a clear methodology for achieving that profit margin. Profit measure must be clear, simple and understandably
  • State of the Legal Market: Hyper-competition and flat demand. Corporate Counsel have bigger budgets, but not spending on law firms.
    • Now outside counsel are just a vendor to be handled by the client’s procurement office. In Toby Brown’s words, we are just another toilet paper vendor. This leads to more RFP processes to try to standardize the process for purchasing legal services.
    • Corporate legal departments are growing. They are both controlling the spend and spending differently. In fact, they are moving legal work in-house.
  • How can KM Participate?
    • To quote Kingsley Martin, think about every KM project and ask how far from the bottom line.
    • Consider yourself the provider of “Knowledge Services” rather than a “knowledge manager.”
    • Help lawyers see that increasing their own mastery of KM tools will help them become more efficient.
    • An obvious place for KM concerns “the numbers.” This means providing information and context for numbers such as the cost of a matter: what goes into that cost, what are the variables, etc?
    • Toby estimates that only 10% of law firms actually measure true profitability rather than some proxy for profitability. When the audience was polled, most did not know if their own firms actually measured true profitability rather than some proxy for profitability.
    • Become the best friend of the pricing person in your firm. They will know where the pain points are and which partner is really in pain.
    • There is a great opportunity for KM to help manage outside counsel guidelines and then track performance against those guidelines. At a minimum, read these guidelines to get an early look at emerging trends (e.g., clients are less willing to pay for online legal research).
  • 2016 is going to be really hard
    • The M&A cycle is coming to an end.
    • There is no major litigation wave on the horizon
    • The prospect of significant bankruptcy work is poor.
  • KM needs to be front and center in making 2016 more tolerable (and even successful) for law firms.
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Build a “KM Rapid Response Team” #ArkKM

Session Title and Description: Firm Mergers – How to Build a “KM Rapid Response Team”

When key groups join law firms, or when firm mergers occur, KM is often left standing on the sidelines. Finance, IT, Records, (etc) all spring into action—but what about Knowledge Management? Shouldn’t KM really be the ‘keeper of the playbook’ and able to ‘prep a program’ that can be triggered on a moment’s notice (see: cross-office training and team-building, professional development, experience capture and dissemination, systems integration, exposure of laterals to firm expertise and leadership)? This discussion will explore how firms can leverage KM to support rapid change initiatives in relation to mergers and acqui- sitions. How does a firm’s value proposition change following a merger? And who’s job is it to disseminate, redefine, and characterize the breadth of expertise at the firm? What tools and methodologies can be employed to help integrate new practices and/or resources—while maintaining a common sense of identity or culture?

Speakers:

Silvia LeBlanc, Director of Knowledge Management, Morgan, Lewis & Bockius LLP
Vishal Agnihotri, Chief Knowledge Officer, Akerman LLP
Ginevra Saylor, National Director, Knowledge Management, Dentons Canada LLP

[These are my notes from the 2015 Ark Group Conference: Knowledge Management in the Legal Profession.  Since I’m publishing them as soon as possible after the end of a session, they may contain the occasional typographical or grammatical error.  Please excuse those. To the extent I’ve made any editorial comments, I’ve shown those in brackets.]

NOTES:

  • KM has the benefit of broader perspective.  KM tends to operate across silos. It works with a variety of people and functions within the firm. This gives KM professionals diverse knowledge and the ability to connect the dots. This also makes KM the perfect group to create the law firm merger playbook or new hire onboarding resources.
  • Why involve KM? When the firm is in merger mode, the firm will call in marketing, finance, etc. They don’t think to call in KM. However, the KM department is one of the support functions that thinks about business problems the same way
  • Communication. Marketing is extremely good at external communication. KM needs to be just as good at internal communications. Focus on the concerns and anxieties of the people who are on the receiving end of change. If the people in the firm are unhappy or anxious, they cannot deliver great service to clients.
  • Getting a seat at the table.  Bully your way to a seat at the table. Then justify your place at the table by solving problems and getting things done.
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