At every ILTA conference the chief information officers of the 100 largest global law firms have a day-long meeting. This session provides a recap for those of us who were unable to attend the full day session.
Speakers: Gareth Ash (CIO, Allen & Overy), Ash Banerjee (CIO, WilmerHale), Don Jaycox (CIO, DLA Piper), Andy Jurczyk (CIO, Seyfarth Shaw). Marcia Stein helped organize the G100 event.
[These are my notes from the International Legal Technology Association’s 2012 Conference 2012. 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.]
- Jim Jones Presentation. Jim Jones (from the Hildebrandt Institute) often is asked to provide a strategic industry perspective to managing partners. He came to the G100 session to share the information he is providing to firm management. Key points: 2012 could be tougher than 2009; the outlook for the next 2 years is not great. Jones reminded the CIOs that this is not just about economic pressures. There are other factors coming into play such as commoditization, enabling technologies, new service providers, globalization. The key is to understand that our economic model is fundamentally unstable. Law firms will not be able to rely on year over year rate increases in order to meet revenue goals. Further, demand for legal services has basically been flat since the market downturn. In Jones’ view, we are firmly in a buyer’s market. Therefore, clients are in a position to make demands on law firms. This means that law firms will have to compete for business on the basis of costs, efficiency and results rather than just on reputation.
- Implications of Jim Jones’ Presentation. (1) Law firms need to be serious about operating as a business. This means they need to focus on efficiency and effectiveness, addressing productivity issues as soon as possible. (2) Will declines in law school enrollment make it more expensive to find and hire good associates?
- How Technology can Transform Law Firms FAcing Changing Pricing Models. (1) multiple pricing and billing systems; (2) systems for tracking profitability on a matter basis; (3) user-friendly interfaces allowing partners to perform sensitivity analysis on different pricing strategies; (4) technical support to assist partners in analyzing and setting pricing options; (5) systems enabling fims to respond quickly and efficiently to competitive proposal requests.
- Implications for the CIO. Technology will increasingly “commoditize” many areas of legal practice, including some complex and high value ones. This means that lawyers will change. Since information is increasingly becoming freely available, clients will pay a premium only for expertize and superior judgment.
- Gartner Discussion. Data protection and security are key. Law firms need to gather and dig deeper into the data with analytics. There is an increasing push to outsourcing in order to control costs. However, that may limit career opportunities within the IT department. It also can mean that the IT department cannot respond as nimbly if they have to manage lots of external providers. On the flip side, having resources in the cloud can provide some flexibility. Just be sure that you don’t outsource any function that comprises your agility and ability to respond.
- Data Security. A poll of the G100 CIOs revealed that relatively few had security specialists on their staff. All understood that in addition to technical controls, the key is to increase security awareness among attorneys. Several firms recommended data security training for lawyers based on resources from the SANS Institute entitled “Securing the Human.”
- What do CIOs want to learn more about?. At the G100 session, they crowdsourced the following topics: (1) How are CIOs measured? What KPIs are used? (2) What are the risks of benchmarking? One big issue is that the benchmarking reports may not allocate the data exactly like your firm does. For example, do network costs show up in operational costs or in IT costs? You have to understand the benchmarking reports before you rely on them for your analysis and planning. (3) How to handle PWC/Citi Reports? Handle with care! It’s very important to key educating the partnership so they understand what contributes to cost and how new projects add value.