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Monday, December 29, 2003

Blog is Moving

Below are this week's new postings, appearing at my new blog at PrismLegal.Com.

I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.
Online Services Update

I recently came across a very well-done white paper, Online Strategies for Law Firms 2004, on online legal services by Charles Christian, Editor & Publisher, Legal Technology Insider. It provides an insightful analysis of the current state of online legal services, especially in the UK.  

Christian discusses three strategies firms can follow: pure marketing, virtual legal practices (which includes both firms without a physical presence and automated services delivered via computer), and web-enabled practices (by which he means delivering traditional services in new ways such as a virtual dealroom). His "virtual legal practice" is what I call online legal services. He notes that "commoditised legal products" delivered over the web have not been very successful.

While that is consistent with reports I have heard elsewhere, that has not stopped firms from trying. In 2003, I identified online legal services from Allen & Overy, Foley & Lardner, Mayer Brown Rowe & Maw, MinterEllison, Morgan Lewis, PortfolioIP, ReedSmith, Shaw Pittman, VisaNow, and White & Case. Elsewhere on this site, I maintain a list of online legal services. (Note that inclusion in 2003 of a firm does not necessarily mean that the service offered in 2003 was new - I may only have come across it then.)

The bad news is that uptake is slow. The good news is that there is likely still a big opportunity for growth, both as firms find the right formula for online services and as corporate clients recognize that automated systems offer a promising way to deliver more legal advice for less money.
Creating Best Practices at Chevron

Chevron spends more than $60 million on outside law firms that handle its litigation reports Refining Litigation (Corporate Counsel, Dec. 2003). A new general counsel who started one year ago has instituted a program to develop best practices in litigation. 

Charles James, the new GC, charged 8 inhouse lawyers with "drafting a better plan for handling litigation from start to finish." He also invited a panel of 8 outside litigators to provide insight on how the company could better manage litigation. The new set of improved litigation practices is still under development. The article reports that it will include a new litigation management specialist position, the composition of the litigation team, how work should be allocated among the team, and how the team should communicate.

While the article does not explicitly mention technology, it will be interesting to see if Chevron publishes its guidelines and if these guidelines explicitly cover technology best practices. In my opinion, any plan should include quite a bit about technology. Examples include the use of spreadsheets for budgets and variance analysis, discovery management practices for paper and digital data (including collecting, processing, and reviewing files), standards for when formal risk analysis should be used, approaches to and tools for trial presentation, and a process to capture lessons learned at the end of the matter.
Strategy and Technology to Support Law Firm Growth

The Wall Street Journal published Kraft's Stale Strategy last Thursday (12/18/03) describing how Kraft's line-extension strategy has failed to develop revenue growth. Before I relate this to lessons for law firms, some backgound... 

Line or brand extension refers to taking an existing brand name and applying it to a similar product. Retailers use this to eke out additional sales and extra space on store shelves. When I was a kid, there was one type of Oreo cookie; now there are many. That's line extension. As the article says, in inimitable WSJ style, "this new cookie crumbled." The failure to develop new products and brands is coming back to haunt Kraft in slow growth.

After reading this, I was thinking if there are lessons in it for law firms. Law firms have increased revenues by merging, adding or creating new practice areas, and raising rates. But they have not created any fundamentally new service or offering. Where is the new concept or brand like a Starbucks or the derivative instruments Wall Street invented?

It's not easy for law firms to create new services, but they can probably do more to enhance revenue growth. And technology can contribute to that growth. Can I.T. Uncork Corporate Growth? , an article in the December 2003 issue of Optimize magazine, is a good read for law firm managing partners and CIOs. The article describes five ways to increase revenue growth:
  • "Base retention," which means avoid losing customers and get growth from them

  • Gain market share

  • Adjust market position (spot emerging areas of demand and grab a high share of that new demand before someone else does)

  • Penetrate adjacent markets (think, for example, of law firm affiliates or accounting firms' efforts to offer legal services)

  • "Invade new lines of business," which means create something new from scratch


  • The authors suggest that customer relationship management software can help across all fronts, but it is, at best a partial solution. Other operational systems and adjustments may be required, including devising new systems that support new business models, for example, Dell's direct selling and Wal-Mart's mastery of the supply chain.

    While the model set forth in the article may be hard to apply directly to law firms, at minimum, firms should think through how to improve the service they provide using technology. Options that could help with top line growth via a better service include
  • using simple spreadsheets to budget every matter over a threshold size,

  • providing personalized access to the firm's work product,

  • delivering advice via interactive systems,

  • managing important relationships, including cross-selling, by effective use of a CRM,

  • relieving clients of certain routine work such as patent or trademark docketing with databases, or

  • providing customized document generation systems.


  • Achieving growth in excess of the overall economy or the legal market takes work and creativity. There are many capable competitors in the legal market and no firm has a lock on business. Technology by itself may not drive growth for law firms, but it is an enabler for many of the most readily available growth strategies.

    Friday, December 19, 2003

    Blog is Moving

    Below are this week's new postings, appearing at my new blog at PrismLegal.Com.

    I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

    If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.
    Microsoft OneNote

    Microsoft has recently released a new addition to its Office suite called OneNote. It's a "free form" text entry tool with a tabbed interface, outliner, and built-in search engine. I have been evaluating the product for about 30 days and like it so far. I think this is software that many lawyers are likely to find quite useful. 

    I am not generally a fan of Microsoft and have complaints about their products and market behavior. But I must admit that for a version 1.0, OneNote seems pretty good. I am using it to store miscellaneous information that formerly would be scattered across Word documents, Outlook, and other applications.

    The "tabbed interface" across the top makes it easy to create multiple topics (e.g., for different clients or projects). Each tab allows creating an unlimited number of named "pages" down the right side of the screen, allowing quick access to multiple subjects by topic. On each page, you can arbitrarily click and start entering text or other data in it's own "block." A quick look at the outlining feature suggests that it is much easier to outline in OneNote than in Word. (I still miss PC Outline from the DOS days! OneNote may be the answer.)

    From the reviews and articles I've read about it, I believe that Microsoft intends OneNote to be particularly useful and optimized for tablet PCs. I have not explored these features (I don't use a tablet), but I can see from the design of the software and my experiences using a friend's tablet that OneNote would work nicely with that hardware platform.

    OneNote creates multiple files, one per tab. I think you can keep tabs at different places in your directory structure and access them from OneNote by navigating via the directory structure. I found this aspect a bit confusing, but did not fully explore because I decided it was best to keep all the tabs in a single sub-directory. The one peculiarity (I have not encountered any serious bugs yet with OneNote) is that when my automated back-up runs nightly (I back-up to a secure, web-based service), the log file shows a lot of OneNote files being updated that I don't see listed in Windows file explorer. I'm not sure what that means, but it seems innocuous.

    If you have experience with or insights into OneNote, I would be grateful if you would leave a comment.


    Electronic Discovery and the Government
    Last month I met with a technical team at a US government organization that has investigative and enforcement authority. The topic of our meeting was to discuss current developments in electronic discovery. This team is guiding the organization's strategy and tactics for dealing with electronic discovery. What I learned was very impressive.  

    The organization has clearly thought through the issues of dealing with large volumes of diverse digital data. They have considered how to integrate paper and how to deal with many different file types. While they do not have all the answers - after all, no one doing electronic discovery does yet - they have a vision and the toolset to back it up. I was impressed to learn that they are using products such as Autonomy and ClearForest, both of which offer sophisticated search, categorization, and meta-tagging features.

    Lawyers in the private sector often assume that the government lacks technical skill and sophistication. Clearly, the DOJ's performance in the Microsoft antitrust case should have dispelled that notion. And this particular organization impressed me as being further ahead in both its thinking and its execution than most large law firms.

    While there is no substitute for good lawyering, to some extent, modern litigation and government investigations are becoming an arms race. This race is about who can get a better handle on electronic evidence. After this meeting, I'd have to say that at least some parts of the government may be winning the race.


    Saturday, December 13, 2003

    Hildebrandt Report on Outsourcing

    Brad Hildebrandt, one of the best known and most established consultants in the legal market (and founder and head of Hildebrandt International) has issued a very interesting special report on the potential to outsource legal work to India. 

    Mr. Hildebrandt reports that his firm will get involved in outsourcing and is considering several business models:
    "1. To consult with our clients on outsourcing as well as developments in the Indian legal system.

    2. To discuss with a number of clients their interest in coming together to invest in a captive company that will provide services to the profession.

    3. To enter into a joint venture with an existing U.S.-based or Indian-based company where we can have input into the design of the services, security arrangements and service capabilities."


    Regular readers of my blog know that I have been following outsourcing for some time and that I believe any effective outsourcing will need to make smart use of technology to distribute and manage work across disparate locations.
    Blog is Moving

    I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

    If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.
    Strategic v. Operational Technology

    Josh Fish of Hubbard One has a good article, Using Strategic Technology to Win and Keep Business, in the November 2003 issue of LawNet's Peer to Peeer newsletter

    In it, he argues that firms should view their technology budget in two bins: operational and strategic. The operational should be viewed with an eye toward cost saving whereas the strategic with an eye to revenue enhancement and profits. Furthermore, the strategic element should be considered from a portfolio perspective, meaning some projects will succeed and others will not; the goal is to earn a postive return on the portfolio.

    This articulates very clearly a view I have always held. I hinted at this distinction - though not so eloquently - in my article The Business Case for Delivering Legal Advice Over the Web. I went a bit further in one respect though, which was to argue that firms need to consider the risk and return on technology investment in comparison to other investments they make.

    The article, in part, promotes the idea of an online legal service, in particular a HIPAA service provided by ReedSmith (see my blog posting on this service). I am a long-standing advocate of online services (see my articles on and list of online legal services).
    Blog is Moving

    I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

    If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.

    Thursday, December 11, 2003

    Paralegals in India

    Legal Research And Back-Office Work To Go Offshore Next in Information Week (12/9/03) reports that "[l]egal research and other back-office work carried out at law firms may be among the next set of white-collar jobs to move offshore in big numbers." 

    The article quotes a Milbank Tweed partner as saying his firm is considering moving some backoffice functions to India. (An interesting aside here is whether the term "backoffice" is the reporter's or the partner's and, if the latter, it is meant to include paralegal work. Viewing paralegal work as a backoffice function is a different issue.)

    Openwave Computing, an outsourcing company based in India, "is in pilot discussions to provide paralegal services for two or three major U.S. law firms."

    As I have suggested in numerous prior posts, the same technology that allows lawyers to work from home (online research, remote access to firm repositories, and high speed net access) facilitate moving work offshore.

    Blog is Moving

    I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

    If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.

    Tuesday, December 09, 2003

    Outsourcing in the News

    Two recent articles about sending work offshore caught my eye.   In New Economy, Companies sending work abroad are learning cultural sensitivity - to their American customers, the New York Times (December 9, 2003) reports that some company's that have outsourced work to offshore locations have run into problems. Dell ran into problems providing service for some of its high-end products and had to re-route the call center back to the USA. In spite of this setback, the article quotes analysts who predict that technology jobs will continue to move offshore.

    In prior posts on the topic of outsourcing, I have argued that law firms should consider moving some work to India or other countries where people are trained in English common law. The problem Dell ran into is not likely to happen to law firms. Dell and other companies providing customer service provide direct customer access to the offshore resources. As I see it, were a law firm or department to use offshore personnel, it would manage the resources directly, review the work, and not allow direct client contact. That does not guarantee that offshoring would work, but this approach would eliminate a risk customer service organizations face.

    Adding fuel to discussion is Change of Venue in the American Lawyer Magazine December 2003 issue. This column's sub-heading says it all: "Cost-conscious general counsel step up their use of offshore lawyers, creating fears of an exodus of U.S. legal jobs." The article quotes Forrester Research, a market research firm, as predicting that 8% of lawyer jobs will go abroad by 2015. The article then sites examples of companies that are using the services of offshore lawyers. The head of one outsourcing firm "notes that foreign outsourcing could benefit large, multi-office law firms. Much of the work being done by junior associates, he says, could be handled offshore." He may not be exactly unbiased, but I believe this is true. The article concludes that with skepticism about the idea of associates losing jobs but nonetheless suggest law firms need to consider the offshore possibility.
    Blog is Moving

    I am moving this blog to PrismLegal.Com, my main web site, that now incorporates my blog (based on the open source WordPress software). The new blog is categorized and offers RSS feed. I will continue dual posting for a while.

    If you happen to point to my blog, please consider re-setting your link to http://www.prismlegal.com/wordpress/. And if you do not currently link to my blog and would consider doing so, I would appreciate it.

    Thursday, December 04, 2003

    Creating Value form Knowledge Management: Making it External and Syndication

    LegalIT reports in Top Scottish firms pool know-how on KM project that several Scottish firms have teamed to create a "groundbreaking KM project to share knowledge across sectors." This is the first time that "a large group of competing firms have decided to pool and share their knowledge."

    The project is driven by a product called Orkell from Legal Data Solutions. I spent some time on this web site and the company has a very interesting idea. The company provides a content management platform and, more importantly, uses that platform to aggregate and re-distribute (essentially syndicate) content from multiple law firms. Firms contribute content to the company and the company in turn re-distributes the aggregated content back to the contributors.

    The Orkell product demonstration is worth reviewing. It is positioning the service to help law firms that serve consumers avoid losing share to publishers and start-ups offering alternatives to traditional legal services. The aggregated data is designed to help consumers via question and answer pairs, fact sheets, and documents. Providing this information can be a form of marketing or can be set up to generate revenue by charging for documents. The company provides content management and web sites, branding each site with a contributing firm's unique look and feel.

    While this new and innovative service appears targeted at consumers and smaller businesses, there are two potential lessons here for large law firms. First, it makes knowledge management an external facing activity. By developing know-how that is delivered to the outside world, a feedback loop is automatically created. If providing know-how generates neither leads nor revenue, presumably this is an economic signal that the activity is not viable. Many internally focused KM programs lack such signals.

    Second, it makes KM a collective undertaking. While there are many business and potential legal issues involved in syndicating legal content, it is a very interesting business model. The presumption appears to be that the participating firms do not have the scale to provide content across all areas of client interest. Large law firms can offer more content on their own, but it may be that even the largest firms do not have all the answers (if they did, why other than conflicts would any one corporation have more than one outside firm?). I am not suggesting that large law firms rush to share content, but it is an interesting idea. It seems to me that from a client perspective, that would be a desirable outcome.

    Tuesday, December 02, 2003

    Social Networking Software as a type of KM and IBM's Web Fountain

    Yesterday the New York Times carried two interesting articles that relate to knowledge management. Markets Shaped by Consumers reports on a constant dialog between producers and consumers about products consumers want. In the past, the dialog was primarily via consumers modifying products (e.g, the first mountain bikes were built from old-fashioned heavy bikes by enthusiasts) or consumers using products in unexpected ways (e.g., using Blue Tooth equipped cell phones not so much for data exchange with computers, but rather to message nearby strangers). Now the article reports software facilitates the conversation, citing both blogs and "social network software." The latter uses "search technology, referrals and rankings" to find helpful information and connect people (including producers and consumers).

    I have previously reported on IBM's Web Fountain full-text project. According to the Times, IBM considers social network technology as one aspect of "what they term 'relationship-oriented computing'." The article provides a bit more detail about Web Fountain: "Using search, business intelligence and text analytics technology, I.B.M. researchers can look for trends, buzz and hints of shifting consumer attitudes as evident from Web postings. I.B.M. hopes to sell this market intelligence as a service to companies. 'It's the collective I.Q. of the Internet coming to your aid,' said James C. Spohrer, director for services research at Almaden."

    A companion piece, Idea for Online Networking Brings Two Entrepreneurs Together, discusses social networking software in more detail. One of the products mentioned in both is Linkedin. I registered for this service a few weeks ago and am still trying it. The idea is to make use of your contacts' contacts. This can facilitate expertise location and relationship management. My initial and not yet very informed opinion of this software is that it is more likely to succeed within an organization or existing community than in the public at large. Law firm knowledge managers interested in expertise location and CRM, however, should keep an eye on this space.

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