Dennis Kennedy

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January 02, 2006

What is Contract Life Cycle Management and How Does it Fit into Legal Technology and Law 2.0 in 2006?

Michael Kraft and Robert Enholm, in their excellent "GC Tech Wish List for 2006," talk about contract life cycle management (CLCM) in terms of "applying technology to the contract process from letter of intent through negotiation and execution to performance, amendment and contract renewal." They also say, "The emergence of enterprise resource planning software over the past decade has helped businesses with "workflow" processes, and GCs are exploring how to apply these principles to the activities of corporate law departments." And CLCM is one good example.

In short, CLCM is about finding ways to look at the contracting process as a business workflow process that can be tuned in ways that benefit businesses rather than as a series of independent, unrelated legal projects.

It's a difference that, as they say, makes all the difference.

I've been thinking, off and on, about CLCM over the past few years, including most recently in some discussions I had involving a large company that wanted to get some control over a very ad hoc approach they had to generating first drafts of standard documents. The business case for CLCM is pretty easy to make.

When I think about contracts (or other legal documents) as part of a process, I invariably think about the potential role of document assembly.

I'm not surprised that Kraft and Enholm move in the same direction in their article. They say, "'document assembly software' is coming to be seen as merely one link in the chain of the contract management process. GCs must be alert to opportunities to use this technology to expedite contract management process."

The "one link in the chain" is the important part of this quote. Too many people I talk to see the goal of document assembly as being to generate finished documents with a "push of the button." That's not it at all. My goal is always to generate significant improvements in generating first drafts - versions of documents that are in "good enough" form that you can start immediately to do custom work and tailoring. People who look for the 100% solution from document assembly are inevitably disappointed and forego the benefits that 80%, 60% or even 20% solutions can bring them.

In a way, they remind me of people who see the benefit of electronic discovery only as a way of finding "the smoking gun." Long-time users of electronic discovery rarely talk about "smoking guns." Instead, they talk about the benefits of productivity, efficiency, organization, streamlining, telling a better story and focusing on the key issues. In other words, there are substantial benefits that flow from improved processes and procedures.

Document assembly brings with it a set of similar benefits beyond the "push button drafts" that most people concentrate on. They are similar to those you find in electronic discovery. Kraft and Enholm mention these other benefits: "GCs that effectively adopt these tools can conserve legal resources and time -- and contribute to the competitiveness of the company."

I've seen the benefits of document assembly coming in not just efficiency, but standardization, quality control, consistency, training, and effective use of learning from previous deals and documents. In fact, I've sometime described document assembly software as a tool for applied knowledge management. As you think in terms of CLCM, you will start to see the role that document assembly might play in the process.

Kraft and Enholm go on to say, "'Contract process software' is perhaps an apt label for the products that bridge document assembly and contract management."

In 2005, Cisco's NDA Central project (demo and white paper accessible from DealBuilder here (free registration required) has deservedly garnered a lot of attention. NDA Central took an undisciplined method of handling simple legal projects and used document assembly as a tool not just to create legal documents, but to manage and improve a business process with positive business results to the company and improved workflow and higher-value work for the legal department and outside counsel.

Again, Kraft and Enholm, "GCs want help from outside counsel to establish processes and protocols, help draft underlying documents and maintain the systems in our ever-changing legal environment." Here's the key to CLCM and the new approaches to using technology in the practice of law starting to be known as Law 2.0 - there are clear benefits to both clients and lawyers. Often, it allows the lawyer to do higher-level work, often the type that the client really wishes the lawyer had more time to do.

Kraft and Enholm provide an excellent, brief introduction to an area that could become as significant to transactional corporate lawyers as electronic discovery is to litigation lawyers. The rest of their article is well worth your while to read as well.

What do I think of the interplay of CLCM and document assembly and the potential that it has? Let's put it this way, if I spent the whole of 2006 working only on these types of projects, 2006 would be a great year indeed. This is one topic you'll being hearing more about from me in 2006.

Technorati tags: law2.0 4g legal technology legal technology document assembly contract life cycle management general counsel technology law contract process software

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy's legal technology consulting services, featuring RSS and blogging consulting, technology audit, strategic planning and technology committee coaching packages especially for medium-sized law firms (15 - 100 lawyers) and corporate legal departments.

Posted by dmk at 01:51 PM | Comments (0)

December 19, 2005

Outside Counsel / Inside Counsel Partnering Through Technology - Article

[NOTE: This is another in the series of repostings of my previously-published articles. This article was written in 2002 in connection with a presentation I did on "client-driven technologies." I became quite intrigued with the DuPont Legal Model and other efforts that I thought would change the nature of the practice of law. This article was written from the perspective of law firms. Today, I'd be more likely to take the point of view of the corporate legal department. Most of the same principles still apply today, although perhaps with a bit more urgency.]

Outside Counsel / Inside Counsel Partnering Through Technology Toward the Virtual Law Firm

Fifty-five percent of corporate legal departments considered firing one or more law firms in 2002, down slightly from 62% in 2001. The leading reason, by a significant margin, was "lack of responsiveness." Add Enron, pressures to cut legal costs on the part of clients, increased rates and demand for billable hours on the part of law firms, and increasing movement of lawyers and law firm mergers to this mix and you get a volatile situation.

Both law firms and corporate legal departments desire stable relationships where work can be done at a high level, responsively and in a way where law firms can be profitable while a corporate legal department can control costs.

There have been a number of significant efforts at "partnering" between corporate legal departments and their core law firms to create these types of stable relationships. The classic example is the famous "DuPont Legal Model" developed by DuPont and its outside law firms beginning in 1992. The DuPont Legal Model grew out DuPont's attempt to reduce the number of law firms it used (then over 300) to manageable number (currently 35) and, in the process, take advantage of a variety of techniques to improve the delivery of legal services.

The core elements of the DuPont Legal Model are (1) a business focus on DuPont's legal issues, (2) an ongoing work process reengineering, (3) a commitment to cutting-edge technology, and (4) a shared culture of efficiency and cost control.

All lawyers who have corporate clients would be well advised to meditate upon these four elements.

Among other things, the DuPont Legal Model has resulted in the creation of the DuPont Primary Law Firm Network, an early form of a "virtual law firm," a collaborative team of law firms and service providers who are willing to and do work together. DuPont believes that the next step beyond simple "partnering" is the collaborative work team and that turning partnering relationships into collaborative work teams offer great value.

Consider this description of a "virtual law firm" (http://www.dupontlegalmodel.com/files/onlinelibrary_detail.aspibid=14) [Note: link no longer works – unable to find new link to white paper):

The virtual law firm connects lawyers electronically and culturally. Through the use of applied technology, such as extranets, integrated case management software, computerized databases, electronic invoicing software, document imaging, cell phones, personal digital assistants, and trial presentation software, team members in different geographical locations can perform legal work efficiently and cost-effectively in a shared environment. But this technology still depends on the human element and on the willingness of committed participants to implement and use it constructively in furtherance of an articulated vision and clear goals. In a virtual law firm, participants must share a common culture.

This description raises many issues and is an excellent basis for your discussion of this topic. I also want to emphasize this comment from DuPont's white paper:

"Without the benefit of sophisticated technology, neither the concept of the virtual law firm nor the DuPont Legal Model could exist."

This article will focus on the technology side of moving to partnering then to collaboration and to virtual law firms and perhaps beyond. There are also very difficult issues raised by taking these steps, competitively, economically, culturally and otherwise that also deserve very serious deliberation. I want to sketch out some key questions for you, some areas worth exploring more and some practical tips for getting started or moving forward.

1. Ask Your Clients. A recent survey indicated that over 90% of corporate general counsel would respond to surveys from their law firms. A tiny fraction of law firms use client surveys. Are there clients with whom you can extend existing relationships by means of technology or current technology cooperation into greater partnerships? Are they aware of initiatives like the DuPont Legal Model? Might they be considering such initiatives without including you in the discussion?

2. Listen to Your Clients. I have heard many stories of companies all but begging their law firms to cooperate on technology. Note that the number one reason law firms get fired is lack of responsiveness. If you survey clients, you must follow up. Find out where they want to go, what their priorities are and what they want to accomplish with their legal services. Of course, you will want to get a clear idea of where you fit into that picture. A very important lesson from the DuPont Legal Model is that clients are not necessarily adversarial with their law firms. Cost cutting may not be the primary concern and companies are willing to explore creative fee arrangements that may be more lucrative for law firms while maintaining a more stable relationship. Don't assume; ask.

3. Learn The Playing Field. You cannot move very far toward implementing client-driven technologies if you do not know what technologies and capabilities your firm has or can obtain. It is rare to find a firm that is using or is even aware of all the capabilities of its software and systems, let alone to find lawyers and firms who have a good understanding of all the new developments in legal technology. In addition, it is vital to understand what software and technologies your clients use for their own work and how they would prefer to interact with you. You might use surveys, meetings with the client or meetings between IS people to compare notes on what software and systems are used.

4. Find Ways to Cut Costs and Improve Profits. How much good will it do you to have your client telling peers and colleagues that his or her lawyer actually came to him or her with a way to cut legal costs? Likely areas of potential include identification of lower level work that can be commoditized or value billed, improved communications, hosting databases or eliminating the need for duplicate systems. Consider the issue of electronic billing. Corporate clients are bemused by law firms' reluctance to move to electronic billing. They see electronic billing as a way to streamline procedures and cut their own costs while at the same time improving the cash flow of their law firms by speeding up the payment cycle. Isn't this win-win? It is certainly worth taking the time to consider fully.

5. Get IS Departments Talking. Exchanging ideas and creating good relationships between your high-level IS people and the comparable client IS people will ultimately be a key to any successful efforts in this area. Do they know each other now? Do they meet with each other? Can you facilitate that in constructive ways? This effort will help resolve existing problems, result in shared knowledge and set the stage for more extensive efforts.

6. The Extranet Family. A key concept in collaboration has been the use of private, shared web sites commonly known as extranets. Extranets can take many forms – information portals, access to files and communication, case monitoring, document libraries and virtual deal rooms. It is important to realize that clients do not need the same features or even a full-blown extranet. A virtual deal room that simply gives access to documents in a case or transaction may be a perfect introduction to the use of technology for both a firm and a client. The time and cost savings of not Fedexing documents can be a measurable means of showing return on investment. Another idea gaining some momentum is the "project portal," an extranet dedicated to the work and resources in connection with a particular project.

7. Apply the 80/20 Rule. The 80/20 rule definitely applies in this area. The idea is that, as a general matter, 20% of your efforts will get you 80% of your results. You want to identify and act on that 20%. Which ideas make the most sense in your current context? From your point of view, which initiatives will best address the common reasons law firms are fired (improving communications to avoid "lack of responsiveness" issues) and hired (how can you show your expertise and understanding of the client's business?)? Do these initiatives cut costs or enable creative billing approaches? Do these approaches connect the client to you and make it harder for the client to leave? Are these approaches useful to other clients? Finally, are they responsive to your client's own list of priorities?

8. Make a Plan. Obviously, these kinds of initiatives cannot be done on a "back of the envelope" basis. Written plans are appropriate. In this case, educating your client is a form of marketing. Implementing the systems may an element of firm survival with a client in addition to solid marketing. The more you show your knowledge of the options, your familiarity with what others have done and the benefits for your client in the form of a well-conceived plan, the better shape you will be in. Part of any plan should be a method of measuring results.

9. Make it Reusable - Think Different. Some of the initiatives you take can be reused. Some aspects might even be licensed as moneymakers for your firm or even sold as products, either by your firm or jointly with a client. Be alert to intellectual property issues and opportunities, as well as reusable methods to implement similar projects for other clients. Databases of knowledge and expertise may also serve you well in the event of departures from your firm.

10. Make it Sticky. Stickiness is a term that is sometimes used in connection with web sites. It refers to a site's ability to keep a visitor on the site for a significant time and to visit multiple pages. By using technology to address key concerns for clients and to make it easy for them to work with you, you can also create a "stickiness" in working with your firms and your systems. As a result, you increase the costs and effort for a firm that wishes to take a client form you.

Conclusion. The DuPont Legal Model began in 1992. More than 10 years later, DuPont and its primary law firms are still working out the model for a virtual law firm. It is not realistic for you to expect that you can jump immediately into a virtual law firm model. For one thing, the cultural and economic issues alone are too complex. But you can definitely take advantage of opportunities to collaborate with clients to put down the technological underpinnings that can lead to such a model and, in the interim, provide significant benefits for both law firms and clients, including, in some cases, allowing your firm to survive and do work for its biggest clients. If you do not address these issues, your clients may dictate the answers for you, and, lately, that may mean that they think about firing you.

Ten Practical Tips for Technology Partnering Initiatives.

1. Educate yourself. My web page at http://www.denniskennedy.com/resources/legal-tech-central/clientdriven.asp is a good starting point. But it takes a lot of work to get up to speed on technology alternatives. Hiring appropriate expertise may be desirable in many cases.

2. Thoroughly understand the DuPont Legal Model. Your clients may approach you about the DuPont Legal Model before you approach them. They are reading about it and hearing about it in seminars. A great resource is http://www.dupontlegalmodel.com.

3. Send a survey. Statistics indicate that the vast majority of clients are willing to respond.

4. Listen to what your clients are already saying to you about technology. Lack of responsiveness is the major reason law firms get fired.

5. Give your clients new ideas to think about. Clients cannot know everything that is available. Give them some great suggestions. Clients appreciate creative solutions. Be the first to mention the ideas.

6. Get the right people involved. Are you the right person for this initiative? Who is? What role will your IS department play in the initial phases? I suggest that a high-level IS person be involved at the earliest opportunity.

7. Facilitate relationships between your IS people and the client's IS people. Here is a simple test. Ask the head of your IS department how many of the heads of clients' IS departments are in his or her contacts list. I bet it is too small a number. Are there ways you can get IS people to get together on a regular basis. Presentations by your IS group to client IS groups may make sense.

8. Find creative ways to control costs. Clients like law firms that are creative. They are also under pressure to control legal costs. Technology may allow you to show you are good at both. Controlling client costs is different from cutting your fees and profits.

9. Use technology initiatives in a way to increase the costs for a competitor to steal your client away.

10. Lead, follow (closely) or get out of the way.

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy's legal technology consulting services, featuring RSS and blogging consulting, technology audit, strategic planning and technology committee coaching packages especially for medium-sized law firms (15 - 100 lawyers) and corporate legal departments. More information on the "Second Pair of Eyes" packages for legal technology audits and strategic planning may be found here (PDF).

Client-driven technology

Posted by dmk at 08:14 PM | Comments (0)

November 15, 2005

The Future of Legal Services - Putting the Consumer First

Tim Allen, Chief Executive of Busines Integrity, the maker of DealBuilder, pointed me to a new article by the renowned legal futurist Richard Susskind called "Backroom boys lead 'positive disruption'" in the UK Times Online (free registration required).

Tim noted that the Susskind article talks a lot about Clayton Christiansen's ideas about innovative disruption, a subject we had discussed in the recent session on e-lawyering Darryl Mountain, Marc Lauritsen and Richard Granat led at the ABA Law Practice Management Section's fall meeting in Philadelphia.

Susskind's article references a white paper I recommend to you prepared by the UK Department for Constitutional Affairs called "The Future of Legal Services: Putting the Consumer First."

The money quote from Susskind's article:

"The top US law firms are hugely and satisfyingly profitable. Accordingly, they seem to be moved to change more by the threat of competitive disadvantage than by the promise of competitive advantage. Without hunger for change, without the worry of being left behind by the competition and, vitally, without clients clamouring for new forms of service, it will be business as usual for the US legal behemoths for many years yet. They will wring every last cent out of the increasingly unsustainable practice of hourly billing and will steer well clear of innovative IT."

Susskind notes that the difference in innovation in UK firms stems from something called "maverick management." He describes this as:

"The reality is that the overwhelming number of innovations (often documented in this column) have evolved from the efforts of mavericks within law firms — energetic, often eccentric, frequently marginalised, invariably demanding, single-minded individuals who pursue ideas that are regarded in the early days as peripheral, irrelevant and even wasteful. But the mavericks persevere and in their dining-rooms or studies at home they beaver away, creating new forms of service for clients. Gradually, their innovations came to be recognised as significant and even client-winning. And soon, everyone claims that the mavericks had the firm’s full support from the outset. A new discipline thus emerges — maverick management. This is the art of nurturing and encouraging mavericks, giving them space to innovate and wrapping some strategy and structure around their innovations only once their ideas have fully gestated. Mavericks are the research and development departments of many law firms."

Important stuff, as is the work Tim Allen is doing. Thanks for pointing out the article and for the great conversation we had on these topics in Philadelphia.

4G legal technology client-driven technology

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy's legal technology consulting services, featuring RSS and advanced blogging consulting and technology committee coaching packages for law firms, corporate legal departments and other professional services providers.

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Posted by dmk at 09:26 PM | Comments (0)

October 30, 2005

Extranet Basics: Taking a Step Toward a Client-focused Practice - Article

[Note: This article, written in 2000, may have been the first place where I started to set out my notion of "client-driven technology." I recently enjoyed a compliment from an extranet vendor about how he had pointed many people to this article over the years. Extranets may now be the easiest way for law firms to provide clients with something they really want by offering a helpful technology. As recent surveys show, extranets are still not used very often by law firms,]

Extranet Basics: Taking A Step Toward a Client-Focused Practice

When we think about technology, we usually focus on ways to make our practices more productive and our lives easier. These are important goals, but in this column I want to shift our usual focus away from ourselves to our clients. As the legal profession sees growing competition both internally and externally, retaining existing clients will become increasingly important to many firms’ survival.

An Internet application called an "extranet" may prove to be an excellent way for many law firms to use the Internet to improve the attorney-client dynamic and retain current clients.

Everyone is familiar with the Internet, the giant global network of computer networks. And nearly everyone has used an Internet browser, such as Internet Explorer or Netscape’s Navigator, to find helpful web sites. Some of you may even be familiar with "intranets," or large internal web sites within a single firm. The former Latin students out there will not be surprised then to find that extranets refer to private web sites that are directed to one or more outside entities.

An extranet is a private, secure web site that, while available over Internet through a browser, can be used only by a limited audience to whom you have given the necessary permissions. Conceptually, there are two types of extranets. The first is a standard web site that has password-protected private areas of content and features. The second is a web site that gives password-protected access to limited portions of a firm’s intranet or internal computer network.

The key difference between an extranet and a web site is that an extranet is secure. No one gets access unless permitted.

A law firm can use an extranet to open access to a controlled number of outsiders, typically co-counsel and clients. An extranet also allows you to customize the levels of access and the amount and type of information made available. Since an extranet is programmed like a standard web site, you can have text, graphics, audio, video, message boards, chat sessions and any other Internet feature on your extranet. In other words, you can personalize an extranet specifically for your client, not unlike the My Yahoo web site.

A few examples are in order. On an extranet site, you might make sanitized versions of research memos and updates to articles available to clients only. You might make copies of all a client’s documents, including drafts in progress, available only to that client. In litigation, you might give a client access to deposition transcripts or even video of depositions, or share all case information with co-counsel. An extranet might provide a client with instant access to time and billing information, electronic bills, and message boards to leave comments for attorneys. Rather than preparing huge closing binders for real estate deals, a firm could instead give a client an electronic copy on an extranet. An extranet might provide clients with updates of legal developments and summaries of cases of interest.

The beauty of an extranet is that your clients require no technology other than a computer, an Internet connection and a browser. And they can access your extranet from any place they can access the Internet.

Extranets have become popular in the corporate setting and, as a result, law firms are getting pressure to offer extranets. As the Internet increasingly changes our expectations about customer service, lawyers must keep up with developments. For example, many consumer web sites show you how many units are in stock before you order and let you track your shipment with the click of a button. Why shouldn’t a client expect to click on a button and see current billings and work in process?

Extranets can be developed internally or "outsourced" to a company like LegalAnywhere that provides a packaged solution. As an extranet gets more complex, or ties into your computer network, you will need a higher degree of sophistication and programming, but standard approaches can serve you well as you get started.

Extranets require commitment. They must work flawlessly. They require that you pay attention to message boards and update content regularly. As you provide features and your clients use them, your clients will suggest new features and expect you to add them. Adding video, message boards, chat rooms or other features can place demands on your systems and your people.

Costs, not surprisingly, will vary, but your first extranet can serve as a template for many other clients.

While I believe that extranets offer a way for firms to innovate and even transform a practice, let me focus on the practical – cutting costs. There are two sides to this cost-cutting equation. With an extranet, you can readily find savings in paper, printing and copying costs, long distance, overnight shipping and postage costs, and travel costs. Moving to a form of electronic billing may help you be more efficient in billing and collecting from your clients.

More important, however, is to focus on the ways an extranet can save your clients money. Can you save them copying, printing, shipping, long distance and travel costs? What if you offer a discount for moving to electronic billing? What client will not like a lawyer suggesting ways to save money?

Extranets can also help you market to your clients. By keeping them informed and making them aware of all your services, you add value to the relationship. An extranet can tie a client to your firm, not just to the attorney with the personal relationship. If a client gets used to the benefits and conveniences of its customized extranet, the client will find it harder to go with a lawyer who is leaving your firm or to another firm without the same level of service.

Clients do not like it when they feel you are not paying enough attention to them. An extranet that keeps them up-to-date, provides them with news and developments and even allows them to collaborate on projects and documents will show your clients that you are paying attention.

If you get the underlying concept of extranets, you should already be generating some good ideas. Extranets are increasingly common in class action cases, multi-state complex litigation and general corporate representation. Extranets offer a way to move toward a more client-focused practice and should definitely be on your technology agenda.

An earlier version of this article appeared in the March 15, 2000 issue of The Indiana Lawyer.

[Originally posted on Dennis Kennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy’s legal technology consulting services, featuring RSS and advanced blogging consulting and technology committee coaching packages for law firms, corporate legal departments and other professional services providers. And, of course, consulting on extranet options and opportunities.

Posted by dmk at 05:56 PM | Comments (0)

October 11, 2005

CFO Magazine on Lawyers for Less

As you know, I pay a lot of attention to articles on developments in the ways the nature and dynamics of the practice of law are changing with the push of clients. With all of the recent talk about "Web 2.0" among bloggers, maybe it's time to start talking about Law 2.0. I'm now starting to see more discussion of these issues outside the traditional legal and law practice management resources.

Here's a good example. The latest issue of CFO Magazine has an article called "Lawyers for Less," by Russ Banham. The blurb for the article says: "Large companies are opting for cheaper, more-predictable alternatives to the traditional billable-hours approach."

In one sense, the article covers familiar territory, if you are familiar with the territory - developments in recent years at DuPont, Tyco, Cisco and FMC Technologies. However, I don't mean that as a criticism of the article - not that many people are familiar with these developments and the article tells the story of these developments as well as I have seen it done.

In another sense, the article becomes much more interesting. It's in CFO magazine, not a legal magazine. The website lists the article in the "Procurement" section, suggesting the nascent trend of viewing legal services providers as just one more standard type of vendor that can be managed and brought under control. Lawyers, predictably, struggle with that notion.

If I were a CFO and read this article, there'd be no doubt that I'd be talking to my legal department about this article and ways we might implement some of the techniques in the article.

A couple of money (perhaps real money) quotes from the article:

"Companies 'already view their law departments as cost centers. They need to look beyond that and bring predictability to them,' says Fred Krebs, president and chief operating officer of the Association of Corporate Counsel."

FMC Technologies Inc. CFO and senior vice president Bill Schumann - "I want low cost first and cost certainty second, and I'm not sure the traditional billable-hour format provides either."

"With Cisco Systems's adoption of fixed-fee arrangements for 'the vast majority' of its business with outside firms, says general counsel Mark Chandler, 'one effect has been a new focus on technology.'"

I really like that last quote.

Take a close look at how the law firms of the companies mentioned in this article have changed their practices. That's one of the big messages in this article.

This article earns my "highly recommended" seal of approval and might actually start people thinking a little harder about something like Law 2.0.

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog)]

This post brought to you by Dennis Kennedy’s consulting services, featuring RSS and advanced blogging consulting and technology committee coaching packages for law firms, corporate legal departments and other professional services providers.

Posted by dmk at 09:29 PM | Comments (0)

September 22, 2005

Fourth Generation Legal Technology

A quick check of Google and Yahoo today showed me that no one has used the term "Fourth Generation Legal Technology" or "4G Legal Technology." I want to lay claim to the phrase to describe a collections of ideas I have.

Here's what I'm thinking.

I've been speaking and writing for a while about the third age of legal technology (the allusion to Babylon 5 is intentional). The first age is secretary or staff focused. The second age is IT department focused. The third age is lawyer focused - when the goal is to get the tools lawyers need into the hands of lawyers.

I was stopping there. When I recently spoke about this in a presentation I gave, I noticed that I was trying to crowbar the idea of "client-driven" or "client-focused" technologies into my description of the third age and it really didn't quite fit.

It struck me today (it takes time for ideas to percolate for me these days) that the age when legal technology has as it primary focus clients, clients' wishes and clients' needs was in fact a fourth age, at least in my way of thinking.

For the last few months, I've been reading John Robb, William Lind and their work on Fourth Generation Warfare (4GW). It's given me a lot to think about.

It strikes me that "generation" is a better word to describe what I see happening in legal technology than "age" or "stage."

It also strikes me that some of the ideas of 4GW analysis - Open Source principles, decentralization, fast innovation, non-traditional fluid forms of organization - also apply in my ideas of client-driven technology (see the other posts in the Client Driven Technologies category of this blog).

This subject, this phrase and this combination of ideas really intrigues me and gives me, I believe, a framework to pull together some ideas and concepts that I've been working with for a number of years. Expect to hear/see much more from me about this (Fourth Generation Legal Technology, 4G Legal Technology, 4GLT) in the coming months.

fourth generation legal technology

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy's consulting services, featuring RSS and advanced blogging consulting and technology committee coaching packages for law firms, corporate legal departments and other professional services providers.

Posted by dmk at 09:13 PM | Comments (0)

September 14, 2005

Client-Driven Technology and the Cisco Model

Jason Krause's new article "The Cisco Way" in the September ABA Journal is an absolute must-read for any regular reader of this blog. I've written on a number of occasions about to what I like to call "client-driven technology."

This article will help you understand how clients to a far greater degree than lawyers wiill change the legal profession, in technology and in more fundamental and structural ways. I'm very confident in that assessment and prediction.

However, I don't want to delay you in reading the article (it might be only available for about a month to non-subscribers).

Here's one of many possible money quotes from Mark Chandler, Laura Owen and others at Cisco quoted in the article:

"In the past you would say, 'I hope there’s one firm big enough to do it all for me,'" Chandler says. "Not anymore. Now technology lets you pick and choose and bring together the best in each area."

Give that quote some serious thought.

[Originally posted on DennisKennedy.Blog (http://www.denniskennedy.com/blog/)]

This post brought to you by Dennis Kennedy's consulting services, featuring RSS and advanced blogging consulting and technology committee coaching packages for law firms, corporate legal departments and other professional services providers.

Posted by dmk at 09:15 PM | Comments (2)

November 10, 2004

A Practical Example of Why Talking to Your Clients about Technology is Important

Mike McBride of the Life of a One-man It Department nicely sums up the problems lawyers create for their clients by (1) not understanding the technology they use and (2) not checking with their clients about technology preferences and problems.

Interestingly, he blames law firm IT people rather than lawyers. My guess is that the IT department at the firm he deals with has made several efforts to educate lawyers about this very issue, probably with light attendance by the lawyers.

The money quote:

"Can you please train the lawyers and legal assistants that you work for to actually attach a document when they're sending it to an outside entity, like the one I work for? I'm really tired of getting yelled at by my users because they can't open the attachments when all that really got sent to them was a link to the document as it exists in your document management system. Obviously, from here, that link is useless."

The lesson here for clients is that you need to raise these technology issues with your lawyers when they happen. Law firms will address these issues when they are pointed out to them. Don't assume that lawyers are aware of these issues or are doing these things only to irritate you. Your best approach is to talk with your lawyers about the programs, formats and other technology preferences that you have.

I have long suggested that IT directors of clients talk with IT directors of their law firms on a regular basis to address these types of issues and share best practices.

Posted by dmk at 10:12 PM

April 29, 2004

Internet Delivery of Legal Services - QuickRecords.com

I've found a number of things lately that show some of the coming directions of Internet delivery of legal services. I want to begin highlighting them on a regular basis. I spent a few moments at a meeting of the e-Lawyering Task Force at the recent ABA Law Practice Management meeting in New Orleans and heard the term "client-facing" approaches. I like this term a lot.

Here's a superb example of a "client-facing" approach to legal services.

I've spoken several times lately with Vince Guinta and Bruce Grogg, who offer services through MyCompanyRecords.com and QuickRecordsPro.com. It's both a solution to a real problem and opportunity for lawyers to make money by adding a truly valuable service for clients.

The common problem for anyone who has a corporation is that the task of basic corporate recordkeeping (minutes, resolutions, etc.) never quite gets done. Poor recordkeeping is an invitation for a court to look past the corporate entity and find peronal liability - the result of a doctrine known as "piercing the cororate veil." The owner of a corporation is usually ill-equipped to handle the recordkeeping, accountants do not usually handle this, and, if you are lucky, a paralegal at your lawyer's office will handle these matters, although often without your knowledge and participation. The problem is clear and well-defined.

With QuickRecordsPro, a lawyer who creates corporate entities can take care of and manage all of the aspects of keeping excellent corporate records and, at the same time, opening an important channel of regular communications. This service also allows a lawyer to create a value stream for a problem-solving service which many clients will be more than happy to pay (and a service many clients would expect that the lawyer would be providing). You can see the economic benefits of this service for a lawyer in, oh, about two seconds.

Some people don't like the term "win-win," but, to me, the term fits this approach like a glove.

I don't do routine corporate work, but, if I did, QuickrecordsPro would be at the top of the list of items for my 2004 business plan. My reaction to hearing about the service from Bruce and Vince was to say, "do you have an affiliate marketing program?" I'm not ordinarily an easy sale, but this service just makes so much sense to me.

If you are a lawyer or a client who wants to get a solid example of what "e-lawyering" might look like, QuickRecordsPro.com is a great place to start. If you do corporate formation and maintenance as part of your practice, you must take a look at what they are doing at QuickRecordsPro. If you are a frustrated client who wonders if and how your attorney is handling your corporate maintenance and recordkeeping, tell your attorney about QuickRecordsPro, or "eliminate the middleman" and take a look at MyCorporateRecords.com.

And tell Bruce or Vince that I sent you.

Posted by dmk at 09:51 AM

December 12, 2003

Another Study Shows Law Firms Disregard for Cost Controls, Innovation

The 2003 Chief Legal Officer Survey, conducted annually by the Association of Corporate Counsel (ACC) and Altman Weil, Inc., has just been released.

A few eye-openers:

"59% of Chief Legal Officers surveyed indicated they have fired or were considering firing at least one of their outside law firms in 2003, up 4.2% from 2002 and over 50% for the fourth year running."

"The number one reason given for terminating a relationship was �cost management issues,� followed by �lack of responsiveness� and �overworking projects.�"

"When asked about the most innovative practice proposed or instituted by outside counsel this year, CLOs ranked fee arrangements number one � although only 22.6% of respondents were able to identify any innovation at all."

�The current economic pressures on corporations are reverberating in law departments,� notes Altman Weil principal, Daniel J. DiLucchio. �If law firms don�t show some flexibility and imagination in working with clients on managing costs, they risk losing those clients to a firm that will.�

"When asked about the most important law department management issue they face, CLOs named cost control/budgets three times more often than any other issue."

A PDF copy of the survey may be found at www.acca.com/Surveys/closurvey/2003.pdf.

Posted by dmk at 04:26 PM

December 11, 2003

Legal Departments, Law Firms and the "Digital Divide"

There's a great line spoken by Ambassador Kosh in Babylon 5: "The avalanche has already started. It is too late for the pebbles to vote."

I was reminded of this line today as I read "GCs Struggle to Hold the Line on Legal Spending" by Rob Thomas of Serengeti Law.

Here's the money quote: "This strong level of dissatisfaction among corporate clients presents a clear opportunity for those firms that are willing to work with their clients to improve efficiency and predictability. Rather than waiting for their clients to impose new constraints, outside counsel can gain a competitive advantage by identifying and proposing practical solutions that will meet the needs of both sides of the relationship."

Thomas describes the key problem: "In-house counsel are caught between a heavier workload and their companies' need to hold the line on legal spending. . . . the top concern of most in-house counsel [currently 82 percent] is getting control over outside legal spending. Dissatisfaction with outside legal costs is leading companies to impose more constraints on firms and to send less work to them."

Further, he adds, "And it's clear that more in-house counsel are turning to technology to increase productivity in order to handle more work with current resources: The concern that increased the most this year was having 'technology to improve the efficiency of the law department and work with outside counsel.' In-house counsel are starting to close the technology gap with their colleagues at firms. Unlike last year, in-house counsel are generally planning to increase spending on various new technologies during the coming year. In general, as Internet-based systems, such as extranets and e-billing, have matured and gained mainstream acceptance, they have moved up in the list of technology priorities that law departments are considering. E-billing is at the top by a wide margin, with more than 28 percent of law departments currently considering implementing it with their firms. The smorgasbord of other technology to help law departments manage their legal work breaks down roughly into two categories: external tools [that include their firms], and internal tools [used only by the law department]. Among external technologies, law department extranets, currently used by about 20 percent of law departments, continue to grow in popularity as a way to share information."

Take just a moment to recall that the most common reason law firms get fired is "lack of responsiveness."

Now consider this statement: "In-house counsel report that firms are not cooperating when it comes to controlling legal costs. Each of the past three years, outside counsel have been rated lowest in performance on cost consciousness and predictive accuracy. In fact, the top suggestion for outside counsel is to be more concerned with costs. These sentiments are supported by reports of law firm resistance to alternative fees, failure to respond to requests for bids, and reluctance to accept other changes sought by in-house counsel."

Anyone else hear the sound of a big train coming down the track?

I've been preaching on this topic for a while, and that's part of the reason I like this article so much. The other reason is that it is very clear that this train is coming and part of my business is helping law departments and law firms deal with these trends. Since law firms don't want to listen to the legal departments of their clients, I'm more than happy to help legal departments, through seminars or consulting projects, put together a package of technologies that will definitely get the attention of their law firms, or help them find lawyers who will listen.

Posted by dmk at 07:16 PM

November 18, 2003

What Gets Law Firms Fired

From The Law Marketing Portal: a transcript of a discussion among three corporate general counsel on "What Gets Law Firms Fired."

It should be no surprise that the participants validate the statistics that communications problems lead to firings of law firms, but the comments on the panel should be instructive to many lawyers.

Posted by dmk at 08:58 AM

November 13, 2003

Myths about Software in Corporate Legal Departments

Pat O'Donnell's article "8 Myths About Corporate Software," is a must-read for lawyers in corporate legal departments that have been slow to adopt the use of technology.

While it may surprise some to see that this type of article still has to be written in 2003, many corporate legal departments are dropping the ball on easy, solid technology efforts that would control legal costs, manage projects and law firms, and generally improve their work and results.

Because the return on investment for technology in corporate legal departments can usually be shown fairly easily, more legal departments should be questioning the slow adoption approach.

Posted by dmk at 12:02 PM

October 06, 2003

Law Firms Open Up

From Computerworld comes "Law Firms Open Up," a short piece focusing on the use (and non-use) of extranets by law firms.

I addressed the benefits of extranets in my article "Extranet Basics: Taking A Step Toward a Client-Focused Practice," which made the points covered in the Computerworld article, plus a few more, over three-and-a-half years ago. It's interesting to compare the two articles. The time from idea to implementation in legal technology can be shocking.

The Computerworld article also raises an important idea that I can guarantee has not received enough attention - what are the ownership issues involved in creating and maintaining extranets for clients?

Posted by dmk at 04:23 PM

July 21, 2003

The Best Article Your Lawyer Probably Won't Be Reading

From Larry Bodine's Law Marketing Blog - Larry posts about a videotape documenting a focus group in which business clients of lawyers were asked a variety of question about their law firms. Larry delivers the quotes, which will give you a good overview of the current ways many law firms treat their clients.

This type of information is enormously valuable, but I can guarantee you that the vast majority of lawyers will studiously ignore it and continue to treat their clients in exactly the ways their clients do not want to be treated.

Welcome to the Great Lawyer / Client Disconnect of 2003. It ain't right and this sorry state of affairs is one of the reasons I left the big firm world to go solo and am also focusing on the subject of client-driven technology.

Here's my favorite of the quotes: "We're actually looking for something more profound - lawyers who don't sell us hours. Companies want to buy expertise, responsiveness and assurance. I don't care how long it takes the firm to do the work. At our company we're asking for something more profound."

Why do I like this quote? Because it is pretty darn close to what I really want to do in my new law practice.

Posted by dmk at 10:28 PM

July 17, 2003

Litigation Trends Article

The May/June issue of the ABA's Law Practice Management Magazine has been posted to the web. Among other excellent articles about the use of technology in trial practice is a fascinating collection of short essays on leading trends in litigation. The list of authors is an honor roll of some of the best thinkers and doers in legal technology and it's flattering that I was included in this group. I talk about client-driven technologies (my current favorite topic), but you will also see Marc Lauritsen on smart technologies, Sharon Nelson and John Simek on electronic evidence, Mark Tamminga on "transparency," and Wells Anderson on virtual court rooms, to name a few. Very cool stuff, even if you don't do litigation, and essential reading for litigators. It's also interesting to notice multiple mentions of CaseMap by this group of experts.

Posted by dmk at 09:58 PM

July 16, 2003

Electronic Discovery Resources

From BeSpacific.com, a great list of electronic discovery resources.

Posted by dmk at 09:37 PM

May 01, 2003

Technology in Corporate Law Departments - The Current State of the Art

A fascinating article by Ashby Jones in Corporate Counsel reports on the results of a survey on what technologies corporate law departments sre using. While I'm frightened by the implications of the findings of any article that starts out, "The once hidebound law firm has finally gotten hip to technology," the article suggests that some corporate law departments make many law firms look like technological juggernauts. Three words for corporate law departments on the subject of technology - Dupont Legal Model. My set of resources on "Client Driven Technologies" has more than a few good ideas for corporate law departments. See http://www.denniskennedy.com/clientdriven.htm. One of my areas of consulting is precisely this field and I spoke on this topic at the ABA TechShow and would be happy to speak on this subject again.

Posted by dmk at 08:51 AM

March 31, 2003

My TechShow Handouts Posted to Web (PDF)

I have now placed copies of my handouts for TechShow on my web site in PDF format. The first set is for a presentation called "Are Clients Driving Your IT Strategy?" and the second is "The Technology Manifesto: Working Closer With Your Business Partners." Both presentations will be on April 5.

Tom Mighell, Sabrina Pacifici and I have been working on getting a group of bloggers and bloggers-to-be together for lunch on Thursday at TechShow after Sabrina and Tom's presentation on blogging. I invite you to join us. Also, please say hello and introduce yourself to me at TechShow.

Posted by dmk at 12:48 PM

March 19, 2003

E-lawyering in the UK

Press release from Divorce Online notes that: "Divorce-Online the UK�s leading online divorce service has announced that it has processed its 5000th divorce since launching their service in May 2000. The service which allows consumers to undertake their own divorce proceedings without a lawyer for just �85.00 has saved the consumer a whopping �4 million GBP in legal fees over the course of the last 2 � years and deals with people from all social classes from famous actors to low income housewives and is a vital service for people living abroad who cannot easily get access to legal advice in the UK."

Posted by dmk at 07:45 PM

March 13, 2003

Client Driven Technology at Preston Gates

Law.com reports that the Preston Gates law firm has developed software to manage electronic discovery documents and transactional documents. This effort illustrates another effort by a law firm to respond to client concerns with technological innovation.

"Whenever a client expresses cost concerns, a law firm responds," says B. Gerald Johnson, Preston Gates' managing partner.

The article says, "Johnson set up a committee called 'Work Smarter,' headed by IP partner Martin Smith, to search for the good ideas. It has taken awhile, but Preston Gates lawyers have created two tools that have made their lawyers work faster and their clients envious. One is the document search tool Patterns. The other, called Structure, helps assemble documents in transactions."

While it probably helps to have Microsoft as a major firm client, this approach is one that law firms are going to have to consider and that large clients will want to request.

Posted by dmk at 10:18 PM

March 12, 2003

Chief Legal Officers Continue to Voice Dissatisfaction with Outside Counsel

I've spent a little time recently on the Altman Weil site, largely in response to their excellent AW Direct email newsletter, which I definitely recommend.

I'm fascinated with these summary comments on the 2002 survey of corporate legal officers:

"55% of Chief Legal Officers surveyed indicated they have fired or were considering firing outside counsel in 2002, compared with 62% in 2001 and 63% in 2000. Each year �lack of responsiveness� has been the number one reason for dissatisfaction. When asked about the most innovative practice proposed or instituted by outside counsel in the last year, the greatest number of respondents said that there were �none.�"

I suggest that the last sentence of those comments is the greatest argument for client-driven technology initiatives ever put in print, and the seond greatest might be that it follows a sentence that talks about "lack of responsiveness." I'll definitely be using this quote in my presentations on client-driven technologies at the ABA TechShow.

A wake up call? Definitely. But which firms will hear it?

Posted by dmk at 10:35 AM

March 10, 2003

The Dupont Legal Model

One of the compelling features of the Dupont Legal Model, one of the most studied approaches to inside counsel / outside counsel partnering and client-driven technologies, is Dupont's transparency about the process. Dupont has created a first class web site for the Dupont Legal Model and it is an excellent starting point for anyone interested in this very important trend in the legal practice. As I've mentioned before, I'm working toward developing a pretty comprehensive set of resources on this topic at http://www.denniskennedy.com/clientdriven.htm.

Posted by dmk at 04:52 PM

Let Us Now Lament the Final Issue of Legal Thought Leader

John Kelly's great newsletter, Legal Thought Leader, has long been a highly useful resource for me. Much of my first exposure to inside counsel / outside counsel partnering and the Dupont Legal Model came from reading this newsletter. With its insightful, well-researched, and just plain interesting articles, and John's excellent book reviews of leading business and professional books, LTL became a must-read for me. Unfortunately, I just got word that the current issue is the final issue. The only silver lining in this black cloud is that the archives (in PDF) are still available online.

Posted by dmk at 04:25 PM

March 03, 2003

Client-Driven Technology - The Cisco Way

Rick Klau has a fascinating report from the CIO Forum on the panel presentation of Cisco general counsel, Mark Chandler. Important comments from Chandler included Chandler's goal that, by end of 2003, 80% of all of Cisco's outside counsel expenses will be non-billable hour work. Astonishingly, for lawyers in the minimum billable hour world, today that number for Cisco is about 65%.

Chandler's final quote: "Technology is absolutely the only way firms will stay efficient and effective. Those who don't use it well won't survive."

If you are looking for a quote to tape up by your bathroom mirror to think about every morning, that's not a bad candidate.

Thanks, Rick, for reporting on the conference, another example of the cool blog thing where you can learn from bloggers what went on at conference you would have liked to attend (or, for those of us with the speaking bug, to have spoken at) but were not able to.

Posted by dmk at 10:46 PM

February 27, 2003

Practical Techniques for Taming Legal Bills

Law.com has an article today called Cracking the Whip by Catherine Aman that focuses on four stories about ways corporate legal departments have forced reductions in legal fees. Of special interest are the comments of Jeff Carr, who I'll be co-presenting with on a related topic at ABA TechShow. Lawyers and law firms who don't get this issue aren't going to get the business in the near future.

Posted by dmk at 07:11 AM

February 16, 2003

Client Driven Technologies

One of my Big Themes in my writing and speaking in 2003 will be what I call "Client Driven Technologies."

Maybe I've gotten a little impatient with the snailish pace of adoption of cool technologies in the practice of law, but I know for sure that it irritates me to see how clients of law firms must pay a big price because their law firms do not use technologies that would streamline work, promote efficiency, improve communication and control costs. Whether you look to the Dupont Legal Model or to simpler, targeted projects, there's much that can be done by both law firms and, more importantly, innovative clients and legal departments. This area is definitely one to watch.

I've created a page called the "Client Driven Technologies Resource Center" on which I will try to collect useful resources on this topic.

I'm also speaking twice on this topic at the ABA TechShow in Chicago in April. I'll eventually put copies of my handout materials for those two presentations up on my site, but two new pieces - Placing Your Bet on Client Driven Technologies and Outside Counsel Inside Counsel Partering: Through Technology to the Virtual Law Firm are linked to from the resource center page.

Please let me know about other resources and I can add them to the list.

Posted by dmk at 08:23 PM

Two Recent Articles

I added two new articles to my web site.

The first is The Coming Battle for Control: Predictions for Legal Technology in 2003 - this year's version of my annual article on what to expect in legal technology. I purposely avoided blogs and wireless to focus on some bread-and-butter practical issues. This article is the first place I unveiled my "third age" of legal technology idea. The article originally appeared in a shorter version in the January issue of ABA's Law Practice Magazine, but that issue was not yet posted to the web when I checked.

The second recent article is called Technology To Go: From Wired to Wireless and Beyond. It appeared as a feature article in the Feb/March issue of Law Office Computing. This topic is getting to be an annual tradition as well. This area of tech is a moving target, to say the least, articles are almost dated as written, but I try to focus on some practical ways to think about what you need.

Posted by dmk at 07:34 PM