From cutting-edge software solutions to new routines, law firms are finding ways to advance performance.
Roughly a decade ago, when law firms were fighting for a share of the reduced post-Recession demand for legal services, it wasn’t uncommon for clients to ask for a nontraditional pricing structure or cost reduction.
More recently, though, some firms are finding the conversation has shifted from dollar amounts to asking how the firm is maximizing efficiency — something Ogletree Deakins has come across more often when responding to requests for proposals (RFPs), according to Jennifer Mendez, who is overseeing the firm’s Chief Knowledge Officer duties until a new one is identified.
“After the Recession, what we were seeing was really more of a demand for alternative fee arrangements over billable hours, and discounted rates — whereas over the last few years, the industry has definitely seen an emphasis on technology and efficiency,” Mendez says. “It’s top of mind for a lot of companies.”
In-house counsel’s interest, she says, is likely fueled in part by the expanded role they’ve taken on. This may have prompted them to investigate legal technology that could help them handle the additional work internally.
More than half — nearly 58% — of legal departments that planned to decrease their outside counsel spend said in-house lawyers would cover the work, according to Altman Weil’s most recent Chief Legal Officer Survey.
“[Legal departments] began evaluating legal technology tools from a research and efficiency standpoint,” Mendez says. “When things started to pick up in the economy and industry, there was an expectation that law firms should be doing the same thing.”
While technology certainly can play a role in efficiency improvement, some firms are also employing other techniques to take full advantage of their time.
Many were. In the past decade, firms have had no shortage of legal tech solutions to choose from. Products are now available that facilitate collaboration, check documents to ensure elements aren’t missing, and even assess litigation strategy. Artificial intelligence-powered searches allow firms to get targeted, fast answers — and attorneys can access files from their desk, from their laptop midflight or from their phone practically anywhere, thanks to cloud storage.
“A number of companies are disrupting the legal tech space,” Mendez says. “From a technology standpoint, they’re really innovating and delivering valuable solutions that create efficiency.”
In addition to commercially available tech products, some firms have created proprietary solutions that were custom-built to address their specific needs.
Ogletree Deakins, for instance, released its internal chatbot KARLOS — which stands for Knowledge and Resource Locator for Ogletree Systems — in October 2018.
The labor and employment law firm’s knowledge management counsel, after finding he was answering the same questions over and over, used basic skills he’d obtained in a computer science course in college to build the first version of the tool, populated with information from the firm’s intranet and responses he’d recorded.
To access a chat window and get questions answered, firm members just need to click on KARLOS’s avatar — designed to look like the knowledge management counsel — which appears in the firm’s intranet navigation. In 2019, the chatbot won the International Legal Technology Association’s (ILTA) Transformation Project of the Year award.
Even with all the benefits today’s burgeoning crop of legal tech solutions can provide, technology isn’t the only — or always even the best — way for firms to become more efficient.
Ogletree Deakins has also introduced enterprise search capabilities that allow firm members to quickly locate a precedent document and identify subject matter experts. Previously, firm members would often send out a mass email asking who had experience in a certain area.
“You can imagine how disruptive that could be, if people are sending them out over and over,” Mendez says. “It takes away from the time attorneys are dedicating to client work to stop and read the email. The firm definitely streamlined the process with its enterprise research tool, which searches through bios, time entry narratives and documents.”
In response to clients’ heightened interest in efficiency and greater pricing transparency, national law firm Thompson Hine created a combination of procedures and technological tools called SmartPaTH. Chief Practice Innovation Officer Bill Garcia described it as aligning planning and emphasizing what an overall engagement will entail with clients.
“In the 2009-2012 era, there was a significant shift in the market; clients were saying the old way of doing things isn’t going to work,” Garcia says. “It really came from our current managing partner thinking about what the market was telling us and how we might respond.”
The system encompasses reporting and other instruments, including a budget and work planning tool the firm’s application development team created that monetizes work plans to help the firm negotiate a fee arrangement.
When the firm is pitching its services, SmartPaTH’s planning and other tools allow it to provide a detailed depiction of what clients can expect from the engagement, Garcia says.
Firms may want to consider a blend of tech and procedural changes if they’re looking to boost efficiency — or if clients are asking them to, a scenario that may remain an ongoing reality for law firms in the post-Recession legal services market.
“You don’t get in the room if the in-house lawyers don’t think you can do the work,” he says. “One of the things we’re trying to explain is what it’s going to be like to work with this law firm. We are able to say with greater deal of precision, ‘Here is what you will spend on legal services between today, when we don’t settle, and the next opportunity for a settlement comes up’ — and you need to take that into account.”
Thompson Hine decided to announce it was using SmartPaTH — which at first had primarily been an unpublicized internal resource — in part, Garcia says, to show people in and outside the firm that the system was here to stay.
“We talk about that as the day we burned the boats — a reference to Hernán Cortés, [who did that] to convince people they were in the New World to stay,” he says. “The idea was when we went public, our clients would begin to expect services to be delivered using these principles, and our lawyers would understand clients would be expecting this.”
While technology certainly can play a role in efficiency improvement, some firms are also employing other techniques to take full advantage of their time.
Thompson Hine has invested in professional development to improve associates’ skill sets, such as how to use budget planning work tools, interim reporting its system generates, and address planning anomalies and variances.
At The McCraw Law Group, a 12-employee firm with two locations in Texas, employees work on an efficiency project for the quarter or year — part of the firm’s effort to continuously improve operations.
Chief Executive Officer John “Lin” McCraw sees it as an essential part of remaining competitive.
“Everybody has a project,” McCraw says. “In litigation, for instance, there are things you can’t control — when cases get transitioned from prelitigation to litigation or when a defendant answers. But you can control your time to respond.”
Firm projects have included establishing a system to ensure clients are following through with medical care — which a defendant may later claim indicates the person wasn’t badly hurt, according to McCraw, even though the plaintiff may not have transportation available to get to appointments — and digitizing its process for signing new clients.
“As a result, we’ve taken something that would take up to several days or maybe a week, and it happens automatically that same day,” McCraw says. “As a result, we’ve saved a lot of staff time reinputting and inputting, scanning and setting it up.”
To measure progress toward efficiency and other goals, the firm also publicly displays individual and team results each month on white boards in its office.
“We post all key performance indicators that we’ve come to realize allow us to better predict what expenses are longer term and also measure against all goals,” he says. “I also have to hold myself accountable. We went over the numbers at the end of the year, and I was responsible for the one area [that underperformed]. I had to be honest and rate myself down.”
McCraw has found personally meeting with firm members to go over what’s happening on a project and whether the schedule is on track can help facilitate them reaching milestones along the way.
“If you just assign projects and don't follow up, the emergencies for the day are going to displace the projects that you simply have to have if the firm’s going to be competitive,” he says. “With some folks, I physically have to go to the calendar and say, ‘From 2 to 4, you’re going to work on this project every Thursday because it’s going to be done by X date.’”
Tech solutions can undoubtedly help firms automate tasks, manage schedules and achieve a number of other positive outcomes. As a result, some firms have relied heavily on them when looking to make operational improvements.
However, even with all the benefits today’s burgeoning crop of legal tech solutions can provide, technology isn’t the only — or always even the best — way for firms to become more efficient, according to Debbie Foster, a Partner with Affinity Consulting Group, an ALA VIP business partner that provides process improvement and other legal organization services.
“There are so many tools available to law firms, it can be exhausting. And it is far too common for firms to just keep on buying the new tools,” Foster says. “Too many make you less efficient. You have to have a well-defined process, and people have to be willing to follow that process. And you need to make sure your technology is being leveraged in the best way possible.”
Firms may want to consider a blend of tech and procedural changes if they’re looking to boost efficiency — or if clients are asking them to, a scenario that may remain an ongoing reality for law firms in the post-Recession legal services market.
“The pendulum may swing back on a lot of things; it’s not going to on this,” Garcia says. “The rise of service providers who can deliver chunks of what used to be delivered by law firms is a trend I think is going to continue, and clients are going to continue to demand improvement in processes, project management and in service delivery — and they deserve that.”
