Legal Business Blogs

Guest post: The Blind Men & Big Data – what does Big Data mean for law firms?

A few weeks ago I returned from the 37th annual ILTA education conference, which was held this year at the Gaylord Opryland hotel in Nashville.The Gaylord in Nashville is not my favorite venue. It was cobbled together from the original Opryland Hotel when the Gaylord company decided to build conference destinations. It’s difficult to easily get from one area of the structure to another, and easy to get lost, The Gaylord hotels in Dallas and Washington are purpose-built and much more ‘user friendly.’

The Nashville Gaylord reminded me of some of our technology that is forced together from a bunch of disparate IT architectures.  While it works, it doesn’t always work well and it’s often difficult to navigate from one technology ‘structure’ to another. Dallas and Washington Gaylords benefited from knowing where they wanted to end up before they started out.

For those of you who may not know, ILTA, the International Legal Technology Association, is a member-owned group composed of business and administrative (not just IT) professionals from law firms and law departments. Chances are that you are a member, as long as your law firm or law department is a member. This year 1,600 members attended, and approximately the same number from our supportive vendor community, including 64 CIO’s from the top 100 global firms – ILTA is truly international in membership and in thought. It is one of those few conferences that consistently deliver high value, which is why I make my yearly pilgrimage, as I have been doing for about 25 years.

While at ILTA a number of trends percolated to the top, including Big Data, attorney competency with technology, and cyber security. These are among the topics for future conversations here at Adam Smith Esq. and I will take this opportunity to discuss one:  Big Data.

We also want to seek your input, via an online survey, regarding what interests and worries you have about legal IT – ‘nothing’ is not going to be a good or frankly a thoughtful response, since technology is a part of everything we do. Becoming an ostrich will only find you completely buried in the sand as the next wave of progress advances

Leaving technology to others is also not optimal, since we are really talking about our business challenges and how to solve them, and if you are in a leadership position your informed input is essential to your firm’s success. Look for the survey in the near future.

Back to ILTA:  I was asked to participate in a panel on Big Data. Our panel consisted of an AmLaw 50 technology lawyer, the CIO of a mid-size US firm, a Big Law information governance manager (who previously practiced law at his firm) and a Global 20 information management leader.

What strikes me about conversations on Big Data is that they are varied.  Sure it’s nice to have conversations with people that are varied and interesting, but if you are trying to tackle big problems, then more focus is needed. Unfortunately, Big Data means different things to – well, to just about everyone – as polling of session attendees revealed. As far as Big Data goes, we may still be at the stage of the parable of the blind men and the elephant; even though it’s all really the same thing, each of us has only a limited window on what it is, and therefore our own distinct perspective.

As the session began I remarked that Big Data discussions in law firms reminded me of the KM discussions we all had back in 2005, when many set out to solve knowledge management ‘problems,’ often by acquiring KM ‘tools’, before we knew what KM meant to us – before we had defined in sufficient detail the business problem we were trying to solve. Are we trying to do this again with ‘Big Data’?

In the corporate world Big Data has different meanings as well. In a retailer like Macy’s or Amazon it is more than likely customer marketing data. In an engineering focused company it might be product R&D data. Whatever the focus, Big Data is important data, supporting important decision making.

During the session we queried attendees using ILTA’s conference ‘app’ that allowed participants to respond to polling questions in real-time using their iPhone, iPad or other mobile device.  When we asked session attendees the first of three questions, ‘What does Big Data mean to you?’, the responses revealed a broad variety of concern:

  • Analytics – 16%
  • Client data – 15%
  • Firm data – 15%
  • Financials – 12%
  • Documents – 10%
  • eDiscovery – 10%
  • Enterprise Search – 9%
  • Storage – 8%
  • Risk Management – 5%

What do these responses tell us? That we don’t know what Big Data is and that we are wasting time?  No, not really. What it does document is that ‘Big Data’ means different things to different firms – and that’s OK. It means that regardless of the overarching term – Big Data – we are working on big business problems within our respective firms, whether it’s client intake, client marketing data, or the computer storage of large volumes of data, as three examples.

The just released Gartner 2014 Hype Cycle for Emerging Technologies Report, a curve of technology expectations, shows that Big Data has just crested the Peak of Inflated Expectations and was dropping into the Trough of Disillusionment.

So, my advice:  Don’t get hung up on the term ‘Big Data.’

The problems we are trying to solve, while large in size and importance, are discrete business problems, so let’s focus on the distinct results we are looking to achieve and disregard the hyped-up terms that are over-inflated and over-used by the press.

Let’s look at our second polling question, ‘How is your firm using “Big Data” to drive decisions?’

  • Report client/matter financials – 22%
  • Identify cross selling/ new BD opportunities – 18%
  • Report practice/office/firm financials – 17%
  • Inform pricing – 16%
  • Measure efficiency – 11%
  • Monitor progress on projects/matters – 10%
  • Who knows what decision makers are thinking?! – 6%

There is some blurring of the results due to cross classification of answers, but the results along with the parallel discussion had us talking over a number of primary areas of concern:

  • Client data:  Finding ways to better understand our clients, with respect to client needs in addition to marketing approaches.
  • Document management again is a focus for some:  Not so much the historical concern with the pure document ‘inventory,’ but more associated with business and knowledge intelligence embedded within our massive repositories.
  • eDiscovery was also acknowledged as a ‘Big Data’ domain, and of all the areas discussed is the most mature, and successful, user of “big data” technology tools.
  • Much discussion surrounding the question of how firms are using Big Data centered on internal firm financial / performance results – and the foundational pricing and profitability of matters.
  • The winner in the discussion and the aggregated poll responses?  Better understanding the profitability of matters: before engagement, during the engagement, and afterwards.  Did we actually meet our forecasted metrics at the conclusion of the engagement?  Or did we just see the illusion of profitability – receiving the client’s check and getting cash in the bank?  And while it wasn’t directly discussed, let’s not forget to use our ‘big’ data to understand why we didn’t win engagements, as well as how we performed on those where we successfully proposed.

Legal Project Management, or as some are referring, Legal Process Management, and matter staffing and profitability were of high importance with the entire group, whether you call it Big Data or a Big Business problem.

The danger zone is the 6% responding, ‘Who knows what the decision makers are thinking!?’ If you and your team don’t know and communicate the top business challenges you face, then your thoughts are lost in ‘Big Data’s’ dump, and you need to quickly dig yourself out and concentrate the efforts of your team.

Finally, attendees were asked, ‘Who is pushing your organization to explore solutions related to “Big Data?”’

  • Knowledge management – 17%
  • Lit/Practice support – 15%
  • Marketing – 15%
  • Senior Management – 14%
  • IT – 14%
  • Accounting – 9%
  • Clients – 8%
  • Specific practice groups – 8%

Responses were mainly even across the answers.

The IT department is a driver 14% of the time, a lower number than in the past, from my experience. For years IT has been the driver of the majority of law firm technology initiatives. While many projects use technology, all are not IT Department projects.  Most are business projects and best lead by that part of the business – with IT in a co-leadership role, from initial conception and not just, ‘We’ve decided to do this, and here’s the system we want you, IT, to implement.’ (But that’s a topic for another day, namely: ‘Why IT projects fail.’)

It’s great to see the people that are closest to a process or problem driving change. Is this in part because more firms are now using professionally trained and experienced business executives in all areas of law firm management? I think its part that and part the New Reality with more focus on good business practices. But don’t forget the IT team!  Your firm’s CIO and technology organization should also bring ideas and vision and be one of the leaders in moving the firm forward.

Thinking about or confused by ‘Big Data’ hype and how it may impact your firm?

Don’t worry about ‘Big Data.’ Be concerned about your business and focus on metric driven decision making to solve business and process problems that need tackling, regardless of whether they involve large or moderate amounts of data. Then choose the appropriate analysis and tools to achieve results.

A quick note before I leave for today…  I attended the last session of the conference, which is usually the ‘kiss of death’ as far as attendance. While it was not on Big Data, it did have big interest, with 126 people sticking around for a highly engaged discussion.  The topic? Security Policies and Procedures: Why You Need Them and How to Decide Which Ones Matter Most.

What’s your cyber and information security posture, and mindset?  More on this increasingly critical topic in the near future.

Written by Doug Caddell for Adam Smith, Esq. Adam Smith, Esq provides consulting services to the legal profession. You can read its blog here.