7 Areas of Improvement for Legal Risk Management - By Stuart Poole
There is an adage that states that there is always room for improvement. The beginning of each new year typically results in an influx of people trying to improve their lives by setting and achieving goals. These goals are usually set because people want to become better at something, stop certain activities or behaviors, or try a new experience in life. This type of thinking and goal setting can also be applicable to law firms, more specifically the conflicts, new business intake and information governance components of legal risk management. Listed below are goals that healthy law firms should be setting for 2017.
1. Gain Efficiency
This statement alone is simple yet complex. Many law firms believe they are running at an efficient level because the work is getting done. However, most law firms have inefficiencies within their infrastructure that are often either not realized by management or realized with no time or money in the budget to correct. For all of these scenarios, an audit should be conducted of all the processes and resources at a firm’s disposal, including learning the capabilities of the firm’s current technology. Law firms often have paid for a technology package but only use a fraction of the package’s capabilities. Once an audit has been conducted, a firm should determine the last time its current processes and procedures were updated. Once these steps are taken, a clear picture of a department’s current efficiency should form. This information should be used to start the framework for immediate changes and help determine strategy decisions for the future.
2. Utilize Automation
Law firms are all over the spectrum when it comes to the level of automation used in the conflicts and new business opening processes. Full automation generally involves filling out a request in workflow which then feeds that request electronically through conflicts for clearance, billing for matter assignment and records for file creation. While some firms already have full automation, others still have a hybrid workflow that consists of a mix of automation and manual steps. In today’s legal environment, manual steps are the death knell to efficiency. Firms should immediately make time and invest available resources to fully automate their matter opening process. Never before have there been so may legal technology options available to make the switch to full automation. Lower technology production costs and greater competition have driven down prices. Law firms that don’t believe they have the time or resources available to adequately address their legal technology needs should partner with experts in risk management and legal technology. The expert can perform the necessary research, schedule demonstrations with vendors, perform the proper level of testing and assist the firm with implementation. The front end costs to a firm investing in technology to fully automate their matter opening process will be far outweighed by the long term gains in efficiency.
3. Streamline the Lateral Hiring Process
The lateral hiring process has become vital to many law firms strategy for growth. With certain practice areas having a stagnated level of growth, a lot of firms are looking to increase their book of business and talent by laterally hiring from other firms. The lateral hiring process is an extension of the conflict clearance process. With many firms competing for the same work and candidate, it is crucial to make sure a firm’s lateral hiring process is efficient and flexible. Firms should audit their process to identify inefficiencies, recognize strengths and weaknesses and determine the average completion time for lateral requests. Upon completing their audit, firms should set up a statistical analysis protocol (preferably automated) to help predict changes and needs. This should create a competitive advantage over other firms with a weaker, less monitored process in place.
4. Cross-utilization of Resources
Firms are currently running lean and most likely will be running leaner in the future. This means law firms need to be well acquainted with their resources and have the ability to gain additional value out of those resources by being able to utilize them in multiple areas. An example would be cross training specialized team members with other duties, which will shore up any depth issues when challenges arise. Another example would be using the reporting features of conflict software to produce information that is beneficial in other areas of the firm, such as marketing, external research and human resources. The more automation a law firm has, the easier it will be to cross-utilize and balance time and energy spends with value and result gains.
5. Statistical Analysis
Statistical analysis is already a hot topic within the legal world. Law firms are using analytics to better understand data and patterns in vast repositories of information. Statistical analysis should be conducted even at an intro level in risk management areas. The more a firm knows about the process to open new business, the better it can anticipate change and adapt. Like it or not, firms are being pushed to be run more like a business and businesses use hard numbers and analysis to make decisions and understand efficiency. Firms should do the same. The greater amount of automation in a firm, the easier it is to get deeper analysis.
6. Research Available Technology
The legal world is undergoing fundamental changes right now, most of which are technology driven. Technology is currently growing faster than ever before, produced at a cheaper rate than ever before and there are more available options than ever before. Law firms generally are not the best at staying up-to-date with available technology; however, it is vital that each department with in a firm be current with technology ideas, practices and available options.
7. Be Proactive with Changes
Law firms historically adjust to change in a reactive, rather than proactive, manner. A firm should anticipate staying ahead of client demands and market changes. Break away from the herd mentality, cut down the amount of red tape and start making changes based on a positive situation instead of a negative. This will propel a department and firm into a more forward thinking mindset. The value in the results will be well worth it for years to come.
There is so much more that can be done with legal risk management teams. The broad ideas listed are just the beginning. The hope is for law firms to really start to understand themselves and look for proactive ways to improve. Law firms should embrace these changing times with wide open arms. A firm should exhaustively search, study and understand its function, capabilities and purpose. Once a law firm has achieved this, the possibilities will be endless.
About the Author
Stuart Poole is a lead consultant for the GLC Legal Consulting Group. Stuart has had over 16 years of experience in the legal space. He is the founder and CEO of Fulcrum Legal Solutions, LLC, which provides solutions and strategies to law firms and other companies in the legal arena in the areas of conflicts, business intake and lateral integration.