Articles Posted in Technology

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Vendors tout the benefits of their software, including its return on investment, but none of them can offer objective, comparative and empirical support. A recent white paper on contract management software directs us to this point. The conclusion states that “contract automation and management can save time, cut costs and improve performance and efficiency better than almost any other initiative.” The claim of “better than” implies a quantifiable basis for the comparison.

Managers of law departments crave proof of such a claim, but their craving will go unsatisfied. Not only do we lack evidence for productivity gains from contract management across a range of companies in comparison to a control group, but also we can’t take the next step and match contract management to intranets, or matter management, or instant messaging, or scanning, or electronic billing, or predictive coding in e-discovery, or other software capabilities. Then to even contemplate how contract management stacks up against non-software “initiatives” – fixed-fee arrangements, offshoring, para-professionals, CLE, Centers of Excellence, and more – is at this time a remote dream.

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When someone refers to “licensed” software it excludes software that it bought outright. That probably doesn’t happen much with law departments, but the term “commercial software” has broader, and more accurate coverage.

In pursuit of clearer terminology, it may be more precise to refer to “home-grown software” rather than “customized.” Home-grown sounds pejorative, but it gets to the root of the idea: a company plants and cultivates the software itself.

Many law departments make changes to packages that they license (commercially-available software) Changes range from minor modifications of field names to wholesale engrafting of new code. A term that suggests the first, tweaks and revisions of implementation, is “configuration.” A department configures its e-billing system according to the rules of invoice review the department chooses.

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At some point of departmental size or maturity, general counsel often have a stake in several kinds of legal software. They and their managers confront whether to license “point solutions” that provide specific capabilities or to license fewer solutions that combine capabilities. Some departments favor a single vendor whose offerings cover the waterfront, an all-in-one path; others want to mix and match from however many vendors are needed, a best-in-breed path.

In the e-discovery space, the strategic fork often crops up. Do you license different software to manage the collection, processing and review of documents or do you use one package that handles them all? Similarly, with matter management do you use a database from one vendor, an e-billing function from another, a dashboard from a third, and license a third-party report writer?

KMWorld, Feb. 2012, at S4-5, covers the basic pros and cons of these software strategies. All-in-one has deployment and training benefits as well as simpler vendor management. Best-in-breed provides more speed and agility to innovate, it can allow a law department to align capabilities better with needs, and it can give cost flexibility.

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Wormhole as Best in Show at LegalTechNY?

Here is a technology flash from Charles Christian’s American Legal Technology Insider (#43) February 2012, at 5. I quote his note in full.

“The most interesting product we encountered at LTNY 2012 was a system not on public show but merely in the final stages of development. All we can say is its codename is Wormhole and it has the potential to transform the way many inhouse legal teams manage their relationships with outside counsel. Watch this space for further news.”

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I have commented before on the amount of information Legal Suite makes public, in striking contrast to the close-mouthed approach of other matter management vendors (See my post of Jan. 27, 2012: revenue, specific users, installed base.). The company’s newsletter this month had more detail.

“Heading towards the 400th customer?

Now in its 12th year of operation, the group [Legal Suite] will celebrate in the spring its 400th client. After Unilever France, the 100th client in 2004, RATP Group, the 200th client in 2007, Natixis group, the 300th client in 2010, 2012 will celebrate our 400th client.”

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If you’re reading this and your company sells software, help the rest of us with a comment. What are the differences between these five terms? Some connotations for me are below but many distinctions and definitions elude me, not to mention there may be other terms that deserve to be on the list..

“Programs” are almost elemental, a notch above “code.” Code is the set of instructions written so that a central processing unit, once the code is compiled (if that is necessary), can do something. The term program sounds out-of-date now. “Let’s license a program so CPM can emulate DOS.”

An “application” does a narrower range of things and is very practical. “We wrote an application to print address envelopes for FOIA requests to the EPA.” Today, “apps” abound for mobile devices.

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How contracts are managed by legal departments is one of the topics covered by Exari’s white paper, Corporate Counsel Contracts Survey Report, Dec. 2011 at 12. A column chart shows the results from approximately 100 legal departments. Given four choices regarding the percentages of the techniques they use to manage contracts, the departments reported the following: paper filing (45% checked it), network drives (52%), spreadsheets (17%), and “contract management systems” (about 30%). The numbers add up to more than 100 because, I presume, respondents were allowed to check more than one and they use more than one technique.

As scanning becomes more routine, I assume paper filing will diminish. Even so, for years to come companies will want to keep the original of important signed contracts.

What struck me from this data is that contract management software appears to be more common in legal departments than matter management software (See my post of March 1, 2011: estimates something like 2,500 out of 25,000 US legal departments use such software.). Perhaps the term “system” implies something broader than a software program. Some people use the word system to convey an entire organizational process with an array of integrated tools and methods and practices (See my post of Feb. 5, 2012: list of 39 contract management offerings sent on request.). Perhaps the respondents who completed the survey were predisposed toward contract management.

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ALM Legal Intelligence compiled responses from 107 senior in-house counsel, about three-quarters of which were general counsel. The summary of the report, in Law Tech. News, Feb. 2012 at 24, says that almost two out of three of the respondents come from companies with annual revenue of less than $1 billion, so many of the respondent departments have only 1-5 lawyers.

Size matters when it comes to e-billing software and its advantages. So, perhaps it is not as surprising as you first think to read that of the 107 law departments “none plan to install e-billing software to track outside counsel and fees.” You don’t benefit sufficiently if you are only two or three in-house lawyers if you have to choose, install, learn, roll out and maintain e-billing software. Even with larger departments the respondents might have thought of matter management software packages as more suited to “track outside counsel and fees.” They might have read the question as speaking merely to the method of transmitting invoices of outside counsel. The short summary also does not indicate what percentage of the respondents already uses e-billing and so don’t “plan to install” it.

In short, a survey finding that suggests an utter lack of interest in e-billing software among law departments may be an artifact of the respondents’ smallness, the question’s ambiguity, or the absence of a revelatory, complementary question. Other data tells us, after all, that e-billing capabilities are spreading.

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By my rough count, at least six vendors at LegalTechNY offered SharePoint applications. For example, Handshake Software explained to me that its software can draw on the structured, SQL data in any matter management system and put that data into SharePoint. It sounds like the ubiquitous software takes a step toward a portal, or a platform, or a data warehouse.

Handshake also explained that their PageGum application lets an in-house lawyer personalize SharePoint. Tools that personalize what is on the screen for a user have great appeal, if the users take advantage of those features.

I note three other SharePoint vendors from the show. CLM Matrix offers a SharePoint application related to contract administration and Business Integrity promotes its integration with SharePoint for contract creation and management with Contract Express. The third is Dolphin software, which swims in the same pool as CLM Matrix and Business Integrity.

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If you are with a law department, and if you are not interested in document review products – litigation support products, the pickings were slim at LegalTech NY other than matter management (See my post of Jan. 5, 2012: 11 matter management systems with booths at LegalTech.).

Even consulting assistance was sparse. Huron Consulting Group had a booth as did Kierested Systems. Epiq, which now has a legal consulting group headed by veteran Jim Mittenthal, a refugee from the diaspora of HildbrandtBakerRobbins, was also on the floor.