NEW YORK — Becoming more data-driven and analytical is a laudatory goal for any law firm; and as the vast amounts of data from a growing number of sources continues to increase, the use of data analytics to promote better decision-making, drive efficiencies and provide better client service is becoming table stakes for firms that want to chart a sustainable and profitable future.
In a panel at last week’s Legalweek 2019, titled “Adopting Analytics in Legal Practice”, sponsored by Thomson Reuters, innovation specialists debated what law firms need to do and what they can do about integrating data analytics into their processes and workflow. David Curle, director of the Innovation & Technology platform at Thomson Reuters Legal Executive Institute and moderator of the panel, suggested there are several smaller steps that any firm can take to get the ball rolling on a data analytics strategy, including identifying and organizing its data, cleaning it, and designating those within the firm who know data well and be on the team to guide the initiative.
“Data analytics is a big tent,” Curle said. “There is a lot of data to sort, and a lot of potential applications for using it that firms can consider.”
Panelist Kate Orr, Senior Innovation Counsel at Orrick, agreed and said there are three “million-dollar questions” that firms must answer first before embarking on any innovation involving data analytics.
- First, how will the firm apply the data? This goes to initial strategic concerns on what the firm envisions doing with data and to what questions it wants to apply analytics. Remember, data analytics is not the answer — it’s the tool to get to the answer.
- Second, how will the firm collect the data? Panelists agreed that data must be collected from wide variety of sources, both internal and external, and held in a single accessible repository. But how that is best accomplished, keeping in mind that internal collection of a firm’s data may be the most difficult part of the process, is an important question to address. To get there, firms need “a thoughtful process that visualizes organized shelves in a library overseen by a really smart librarian,” Orr explained.
- Finally, how will the firm get their people to use data analytics? If the other two are million-dollar questions, then this is the trillion-dollar one, Orr said. It’s the essential goal of data analytics to funnel information to those who need it, when they need it; and that takes a buy-in by all employees to be willing to use analytics to improve their processes and efficiency. How the firm will get them there is a key question.
“The applications of data, once you have it prepared to be analyzed, are infinite,” said Orr. “You just have to think of them.”
Meredith Williams-Range, Chief Knowledge & Value Officer at Shearman & Sterling, described to the panel how her firm moved the needle on innovation by creating Shearman Analytics to spearhead the firm’s internal adoption of data analytics. “Data always tells a story,” Williams-Range said. “You may not always like the story, but it is important to know what the story is.”
She said the driving force behind Shearman Analytics was a desire to connect the firm’s systems and data to improve processes, create value, and streamline systems and resources. As an early step, the firm created three core pillars —data collection, data governance, and data analytics — to guide implementation.
“Data analytics is a big tent. There is a lot of data to sort, and a lot of potential applications for using it that firms can consider.”
First, the firm had to decide how best to house its data and replace its current siloed systems of data retention with a centralized hub, Williams-Range said. Then, the firm needed to decide how it should collect data internally and externally, giving special consideration to passive collection of data that is mined elsewhere through vendors or other third-party groups. “The collection process is critical, and you have to address questions of what is known, how it’s known, and how the firm can get it,” she added.
The governance part of the data strategy, which Shearman also hopes to complete this year, is a complex but incredibly important aspect of the process because it determines the ethical use of the data involved, including how the data will best be secured. “The need to architect and govern data is crucial because this is where we introduce rules that will determine the ethical use of the data and how we will understand the data,” she said, adding that all impacted areas of the firm need to have a seat at the table during this process.
Though it’s a long, deliberative process, Shearman’s focus on its data strategy will position the firm to more completely address client needs going forward, said Williams-Range. “We see analytics as helping us understand why things happen and how to better use data for insight and decision-making,” she said. “We see analytics as a differentiator.”