Ask Dr. Paola: Taking the Fear Out of the Use of Big Data

Topics: Corporate Legal, Data Analytics, Efficiency, Law Firms, Leadership, Legal Innovation, Q&A Interviews


The Legal Executive Institute blog is honored to be working with Dr. Paola Cecchi-Dimeglio, a behavioral economist and senior research fellow for Harvard Law School’s Center on the Legal Profession and the Harvard Kennedy School, on a monthly column. Each month, Dr. Cecchi-Dimeglio will be answering questions about how law firms and legal service firms can navigate a dramatically changing legal environment by using data analytics and behavioral science to create incentives for law firms or their lawyers to change behavior. (You can follow her on twitter at @HLSPaola.)

On to this month’s question…

Ask Dr. Paola: We hear a lot in the legal industry about the importance of big data. But practically, what does that mean? And in what ways can my firm use big data to answer questions about how we operate?

Dr. Cecchi-Dimeglio: To be honest, I think not only law firms, but overall, a lot of people don’t necessarily understand at first glance the power of big data and how big data is changing everything around us. They know that it’s important, but may not really know how it pertains to law or how big data can be best used in law.

However, to understand how big data can be used, you must first understand what big data is.

Big data is generally exemplified by three main characteristics: volume, velocity and variety. With volume, big data is simply a level of data that is too much to be handled easily; with the velocity, big data means that the speed at which data is collected is too much to be handled easily and too difficult to be analyzed; and as to variety, big data includes what’s gathered from wide-ranging and multiple-types of data sources.

Dr. Paola Cecchi-Dimeglio

The notion of big data can be envisioned by picturing a big ball that is generally very hard to be handled by an organization unless all the ecosystems of the data are integrated in a way that is manageable. But ultimately, when you are able to get big data together and coordinate your analysis, you are able to uncover items, patterns and relationships, with the data gathered from multiple sources and numerous transactions.

And so, when we talk about big data, we also have to understand that there are various types of big data, each allowing us to do different things. The four main types of big data are: prescriptive, predictive, diagnostic and descriptive.

Prescriptive data, for example, is generally used when we want to know what action an entity should take, using analysis to give you a 30,000-foot perspective. This also allows us to know that you can prescribe changes or incentives that can be applied to specific practice groups or specific types of legal matters.

Predictive data use is when you are running different scenarios and analyzing what might happen, sort of trying to identify past patterns to predict the future.

Similarly, in diagnostic use, you look at the best performance, and seek to determine what happened and why. For example, you could do analysis of a certain court, jurisdiction or a judge and see how many times you’ve gotten dismissed, or how many times the summary judgment was upheld. It’s a useful tool to help determine most often-repeated outcomes, allowing you to make decisions based on past patterns and past results.

Descriptive use is analysis of what is happening within an organization right now — a sort of data mining to really uncover patterns from all kinds of data to allow you also to get a better picture of where you are as an organization or firm.

But like with anything else, the use of big data is a matter of being comfortable with it. You need first to understand it and appreciate how to use it — and not to fear it.

In future columns, we will dive down into what each of these big data pathways can do for law firms if utilized correctly.