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July 07, 2010

How Should Law Firms “Gear Up” to Manage Projects Better? – A 50,000-foot View (Part 2 of 2)

This two-part series was written by LegalBizDev Principal Steve Barrett, former CMO at Drinker Biddle.

Steve_barrett You’ve decided that your firm needs to assess the need for or embark upon instituting project management as an efficiency improvement and margin protection discipline (see part one from last week). 

So here are your options:

1. Do nothing. Assume hourly rates are permanent and that clients will gladly relent in their pressure for efficiency, cost savings and predictability once the economy resumes its growth. Most think that won’t happen.

2. Train your lawyers in alternative fee arrangements (AFAs) and legal project management (LPM) to help them deal with AFA pricing, improve matter management, achieve efficiencies, and build more interactive relationships with major clients.

3. Hire a cadre of project managers and/or purchase and install sizable LPM software solutions. This may include (listed generally in order of increasing cost and support requirement):

a. “Cloud” web-based PM solutions, such as Basecamp, ProjectSpace, QuickBase (from Intuit), @task, ClientSpot, Teamwork Project Manager and the like, which are comparatively inexpensive (typically $25-$50 per month per user), support internal and client collaboration but are not specifically optimized to legal processes. Many law firm IT staffs use this type of project management/collaboration software themselves for internal firm systems roll-outs. One new cloud-based system, Onit, was developed for the legal industry by knowledgeable lawyer-programmers and is currently in beta testing at several major law firms. A number of other cloud-based collaboration systems are out there, such as Scrumy, ProjectSpaces (not to be confused with ProjectSpace, above), Collabtive, Gantter, and LiquidPlanner. Many are free to use, and one, Gantter, promotes its integration with and similar looks to Microsoft Project. These online cloud solutions can vary from the very basic – best for simple casual group projects only – up to more secure extranets for firm/client collaboration – which have good calendaring and task tracking capabilities – on to the more recent Onit legal-specific system.

b. Packaged desktop PC project management software, such as the omnipresent Microsoft Project or dozens of its competitors, most of which are rather complex and not tailored specifically for the legal environment. Microsoft Project is now but one entry in a suite of Service Delivery Management (SDM) solutions offered by the company as an applications ecosystem for professional services firms. Desktop PC solutions also may not generally support ready collaboration across networks or with clients, and law firm time entry and accounting information must be imported from separate firm systems. There are even freeware desktop alternatives to Microsoft Project, such as Open Workbench.

c. “Heavyweight,” integrated legal software solutions are arriving, such as Thomson Reuters Engage, developed in partnership with Hildebrandt Baker Robbins, a Thomson Reuters sibling company. The system is in beta test stages at several name law firms. LexisNexis’ Redwood AnalyticsTM also has software tools and processes available, as does Data Fusion Technologies' IntelliStat (for Elite accounting system users). We haven’t details, yet, on their pricing or capabilities, but since they are established legal vendors it is likely that their products and services are both comprehensive and expensive. Both offer training and consulting and, one can assume, do integrate with the major law firm accounting systems for data extraction. Also, the major legal accounting software vendors, such as Aderant, incorporate analytic tools and are planning more systems in matter management/AFA solutions in the months ahead.

d. Comprehensive Continuous Improvement/Process Improvement reengineering, such as Six Sigma, Lean and Deming-type continuous improvement/process improvement undertakings, aim at eliminating errors and extraneous steps in all legal processes, much like Toyota, Motorola and DuPont continuously improve their manufacturing processes to eliminate waste and errors, and to speed up production without sacrificing quality. Several law firms have undertaken such initiatives, such as Seyfarth Shaw and Eversheds, for example, at considerable expense and commitment.

4. While all of the above classes of software or process solutions may be expensive, they appear to ignore two important options that require little or no technology investment:

a. Go for the “low-hanging fruit,” by developing simple just in time, just enough process changes and by shifting attention of lawyers to the discipline of matter management efficiency improvement.  This often includes economical workshops or training to self-examine law firm operations and processes so that firms may formally or informally develop process and behavioral client service changes in order to better manage projects in the “new normal” of AFAs.  (Full disclosure: our firm offers such educational, interactive or consulting services.)

b. Fully exploit existing law firm accounting systems.  It’s been eye-opening to see the many features and benefits of the three major law firm accounting systems (Aderant (formerly CMSOpen) ExpertTM or Practice Manager, Thomson Reuters’ Elite 3E or ProLaw, and LexisNexis’ Juris or PCLaw).  These systems are just as prevalent in law firms as Microsoft Outlook, Office applications, and Exchange and SharePoint.  In fact, if your firm has one of these accounting/financial management systems, you likely can already do almost everything you need to do to better manage legal matters and projects.  If your system is an older version, you can either upgrade or update (which could be a significant cost, in some cases) or purchase modest add-ons to provide the scoping, budgeting, calendaring, tracking and reporting you’ll need.  Thus, you won’t have to “double-clutch” to integrate a new PM solution with your firm’s existing accounting package, where most of the salient time and billing data reside, anyway. 

With few exceptions, these systems provide cost estimating aids, budget loading on a matter basis, task assignments and responsible parties, periodic or ad hoc reporting on time/dollars worked/billed/remaining (and collected), as well as the ability to calendar and track matter sub-tasks and generate budgetary or deadline alerts.  Yes, they may not have the sophisticated critical path and dependency analysis capabilities that a fully configured PM package may have, but they can output data and reports in formats usable in Excel tables or PowerPoint outlines.  In most cases, though, once the overall scope, detailed tasks, timeline and responsibilities are delineated, an experienced partner can quite easily see which tasks depend upon the completion of prior tasks (sequential) and which do not (parallel).  Let’s also not forget Outlook’s underused but powerful calendaring, meeting scheduling, and individual or shared task/”to-do” list tracking capabilities, available even in the oldest versions of Outlook.

For those wishing comprehensive solutions akin to the integrated heavyweight systems above, the major legal accounting systems vendors either are already there or are well on their way.  Ask yourselves: do we want to be project management specialists exporting law firm accounting data into separate PM packages for analysis (with all the significant infrastructure reconfiguration required)?  Or do we want to do a better job of using what we already have, systems that are fully integrated and usually closer to “real time”?  The latter could cost far less, and has the added benefit that we know lawyers and administrators will use it, since they already do.  That will minimize the disruption or resistance met in rolling out whole new applications to busy timekeepers.

My thanks to the law firm accounting software systems representatives who explained the capabilities of their existing and future product offerings and reviewed our text for accuracy: Don Howren at Aderant; Amy Kosey at LexisNexisJuris; and Sabrina Wainio at ThomsonReutersElite.


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