Recently, I took part in three events discussing disruption in the legal services sector. At each of them, Big Data was discussed, which isn’t surprising because that term is now a part of the legal services vernacular. What interested me were the simultaneous discussions using the term Big Data in different contexts. Although the term Big Data originally was a descriptor for the unfathomable amounts of data created every day at ever faster rates, that term is now a catch-all for all types of discussions around the use of any data.
Practitioners in the eDiscovery and governance fields are using Big Data in a context that is closest to its original definition. Many practitioners have pivoted their practices away from traditional eDiscovery work and started to refocus on information governance and cyber security. Because higher volumes of data are being created at faster and faster rates, companies are storing and holding rapidly increasing amounts of data on their servers or in the cloud. The focus of these discussions was on how to search and categorize that data to meet the company’s discovery obligations and how to identify data that can be destroyed without creating spoliation or sanctions risks. It is not clear yet how many companies will invest time and money into implementing a deletion program, but at the moment, there is a lot of discussion as to which tools and workflows might be used to do it. While Big Data might not be a perfect term to discuss the issue, it is seems to be the most accurate in comparison to the other discussions occurring.
Pricing and Delivery Costs
For firms that grapple with getting cost accounting data to build P&Ls around practice group and matter-level profitability, Big Data is being used to describe the need for better tools to mine the firm’s financial data. Many time and billing systems don’t create the necessary data sets because they are not true financial reporting tools; those tools were built to record time and generate bills. Prominent metrics, such as Revenue per Lawyer, Overheard per Lawyer and Profits per Partner, are broad indicators of a firm’s success, but they do not create a granular understanding of the costs to deliver services either on specific matters or types of work. Firms need better information to negotiate alternative billing arrangements and make smart decisions on practice group investment or divestment. To do that, firms need better tools to better mine information and better sources of data to mine. Because of those needs, valuable conversations occurred — but was Big Data the best frame of reference for those discussions?
Another Big Data discussion was around how collecting the appropriate data can assist in risk assessment and mitigation with a focus on “trending.” Getting multiple types of data from multiple data sources to assess risk trends is important. While electronic billing and task-based billing codes provide useful information about how firms spend their time at the matter level, there is a degree of subjectivity in how the billing codes are applied, which can yield some murky data. In fact, the actual information is inherently limited. What it is indicative of is how much time was spent on different aspects of a matter and how it was staffed. What the information does not provide is a more holistic sense of a company’s risk profile. Law departments need platforms that can mine data across a spectrum that encompasses legal spend, substantive case information and operating company performance metrics to find patterns of behavior that either create or mitigate business risk. Clarifying what data is pertinent and how to best gather it should be the focus of your Big Data discussion.
Each of the discussions above is worth having; however, it’s debatable whether some or all of them are true Big Data discussions. Nevertheless, the term is used in a number of different contexts, and because of that, it is critical to provide upfront clarity about the context in which you are using the term. For organizations with multiple communities of stakeholders with different needs, stating the context leads to better discussions of the specific business needs you are addressing. Whatever language you use, the bottom line is most companies are trying to better understand how to best use their legal budgets to meet the needs of their businesses. An important early step is to identify the actionable information and analytical tools to do just that. This is why we work with law departments to collect benchmarking data and develop delivery models with the right blend of internal and outsourced resources. We have found that avoiding terms like Big Data and focusing on the nature of the business challenge has helped us expedite our understanding of our clients’ needs and objectives and move forward to take actionable steps toward developing appropriate delivery models for the organizations that we serve.
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Mark Yacano is a recognized innovator in the delivery of legal services and a trusted adviser to corporate law departments working with corporate counsel on both business and legal strategy. As the Global Practice Leader, Managed Legal Services at Major, Lindsey & Africa, Mark and his colleagues in the Solutions Practice Group work with clients to develop outsourced talent solutions that allow them to reduce their legal fees while improving the quality of work performed on their behalf. He can be reached at (202) 292-2887 and firstname.lastname@example.org.