Improving Collaborative Litigation Management

Law firms have struggled to defend their profit margins in recent years as clients seek greater control over their litigated costs. Fierce competition and the recent global economic downturn have also taken their toll. In response, smart firms have learned how to differentiate their service from competitors by delivering consistently high-quality service and nurturing strong client relationships.

Yet in pursuit of those goals, too many firms must still contend with the special challenge of litigation management in collaboration with corporate clients. Even when firms value this collaboration, they may fail to achieve this by using the wrong approach supported by the wrong tools. To succeed in collaborating, a law firm must first accept the need for collaboration and then develop clear goals, establish a strong organizational commitment and support that commitment with effective technologies.

Law firms face a choice in assessing the need to collaborate with their clients. It may be viewed as a chance to gain advantage in the marketplace, or as a threat to their customary way of doing business. In either case, firms should bear in mind that many clients view effective collaboration as a strategic goal in their quest for more profitable vendor management.

Service and Accountability

The best firms prosper through service and accountability to their clients. They apply those values to their internal operations and client engagements alike. The technologies through which that service and accountability are expressed come in two varieties: those used to automate or improve customary business processes (such as time keeping) and those used to present the firm to the client (such as billing or client-relationship management).

Clients increasingly want more involvement in determining the services rendered and fees assessed by their collaborating firms. As a result, they require law firms to accept and use those technologies that offer both parties strategic benefits and procedural efficiencies.

For example, rapidly evolving online technologies enable real-time joint decision-making and sharing of confidential information. From the client's point of view, using technology in collaborating builds partnership between the collaborators, while increasing the cost-effectiveness of those activities.

In evaluating their collaborating firms, corporate clients may ask:

  • How do I know I got my money's worth?
  • How do I know this was the best achievable outcome?

 

Unsatisfactory answers to these questions may affect a firm's reputation for years to come.

Software Solutions

Without any collaboration tools, law firms risk unpredictable second-guessing by the client after the services have been rendered. Proactive law firms use their Web sites or create Extranets to offer credible information as a substitute for subjectivity in clients evaluating the outcome. To increase the transparency of their operations and codify client perceptions of their expertise, law firms can deploy web-enabled "matter" management software to invite clients to view the firm's internal metrics.

Progressive law firms open up their processes to the scrutiny of matter management software as a benefit to their clients and themselves. Clients gain greater understanding of the firm's operations. And those firms that perform well can produce convincing data to support their bids for more business. As a bonus, firms can also use that data to benchmark the success of individual attorneys in delivering the service and accountability so prized by their clients.

These solutions store the firm's commitment to meet specific client expectations. They measure the client's most important metric in assessing the firm's value as a collaborator: Did you do what you said you'd do when you said you'd do it? In this way, the firm can exploit its Extranet as a powerful marketing tool.

In recent years, clients have begun to demand standardization, collaboration, predictability and accountability in their business relationships with law firms. Typically, a client will tell its partner firm to post fees to the client's own system so the client can evaluate the firm's charges by the same standards it applies to all other law firm vendors.

By anticipating these demands, collaborating law firms convey an understanding of their clients' needs. Firms that consistently provide clear data in their collaborative relationships help to document their desirability as partners. Client access to tangible metrics lessens a firm's risk of falling victim to arbitrary client decisions or staff changes.

The use of electronic document collaboration technology by more firms and their clients cuts the costs of photocopying, office supplies, postage and courier delivery.

But the most valuable benefits of these technologies are evident in so-called "soft savings":

  • Greater speed in responding to client inquiries
  • More administrative requests filled by clients themselves, freeing a firm's associates to perform legal services
  • Better data and reports available to partnership committees
  • More barriers to client switching
  • Better control for managers and accountability for associates

 

Profits

But what of profits? How can technology raise a firm's threatened margins? In part, technology helps to streamline the value chain through support of each step that affects a firm's ability to win business. Those steps include a familiar sequence of activities:

  • Contracting work
  • Assigning work
  • Completing work
  • Invoicing
  • Client feedback

 

Technology also answers critical process questions:

  • What is the firm's accounts receivable cycle time?
  • What is the firm's percentage of book to revenue collection?
  • Which clients pay on time and send us the most work?

 

Of course technology speeds operations, cuts costs, promotes efficiency, and codifies resources and outcomes. But for the firm in search of greater profit through differentiation and performance, technology reveals flaws in business processes and value-chain linkages. Once exposed, these flaws present opportunities for improvement that may rely, in part, on the power of technology.