Formal Title, Session Link and Slides: CIO Roundtable - Challenges in Demonstrating IT Payoff
Being asked to demonstrate the business value of IT to your firm management? Join an international group of CIOs from three ILTA member firms for an interactive discussion on how IT service value may be evaluated when compared with leading financial performance indicators. Examples and ideas on determining key performance metrics, measuring and tracking trends, working with firm management to develop financial performance indicators, as well as mapping existing technology to key business processes will be explored.
Janet Day - Berwin Leighton Paisner
Peter Bier - Osler, Hoskin & Harcourt LLP
Brent Snow - Baker & McKenzie
David Cunningham - Managing Director, Baker Robbins & Company
The main lesson of this excellent sesssion, moderated by David Cunningham, was that CIOs can use project management implementation to greatly reduce the amount of time and money that they and their staff spend on infrastructure, basic support, and other "plumbing," and should use the resources thus freed up to concentrate on areas that more directly benefit the firm such as business process improvement and lawyer efficiency. In corporate terms, they should try to move from "keeping the lights on" to "Research & Development."
Model of IT Advancement
David lay out a basic framework, adopted from Carnegie Mellon's Capability Maturity Model Integration (R) or CMMI, of five-stage legal IT development. The slides at the presentation and as attached above were essentially illegible, but the basic idea is that IT can be ranked in the areas of people, programs, technology, and facilities, along a sophistication scale. The lower the rank, the more reactive and less proactive the area is. The higher, the more sophisticated the IT business processes and project management implementation. Law firms typically are not above stage three. Most are at stages 1 or 2 in these four areas.
Baker Robbins has surveyed is that law firms fall into three categories. One-third have a “low-cost, high-risk” approach. Only one person knows how to do things, little project management, and so forth. Low cost would be ~$6,300 per employee, a high cost would be ~$14,000.
A second third spends a lot more but is still high-risk because they spend a lot on operations.
The panel is more in the last third, where as firms get more into Levels 2 and especially 3, the IT costs per employee start to come down. Then IT can start focusing on projects. As technology companies mature, PM and quantitative skills start to be more valuable. Reskilling happens more than dropping total head count. They are fighting fewer fires. IP people start to move from infrastructure skill sets to business analysis or Project Management roles.
Janet's firm has very strong business process management. They have binders and binders full of documentation of their business processes and projects. Project management include rigorous change management and measurement of return on investment. Her bailiwick is a little larger than a typical IT director's, and extends to such functions as facilities, know-how (KM), and copying.
The extensive documentation extends to people. Each IT staff person has a publicly exposed career development framework.
These rigorous processes have led to clear documented savings. One example she gave was an office move from one city to another in a foreign country. Where it might have required several IT staff to be present for a few weeks before, now they only had to be onsite for three days, because everything they needed to do was mapped out in advance. Another documented success was the implementation of time entry through mobile devices, which broke even after "29 days" where she was expecting it to do so after six months. ROI there included the 12 minutes (0.2 hours) each attorney had to spend to learn how to use the new system.
She is assisted in measuring ROI by her staff accountant. She also obtains sign-off for large project's proposed ROI from the finance chief.
Peter ran a professional services firm in the technology space before coming to his current law firm. The IT organization had been focused 95-99% on operations / plumbing. He runs the project management office, which is a separate organization, as well as IT.
He is trying to work at role definitions. The wrong mentality is “I sit at my desk until I get a call.”
He sold the idea of having a chief architect as part of his interview process. He hired one to set up a good process, and develop longer-term vision for IT. His information architect looks at issues like data in more than one place and overlapping functionality. He wanted to make sure that all of the designs were being reviewed by one person. It was harder to sell the position to the rest of the IT team than to get the position approved. It’s a risk management issue for him.
They had data centers in each office, but are centralizing them. People information was scattered in 25 silos, may have been inaccurate in some of them.
They’ve split off some people into a project services team. Some IT staff will be more applications experts, some will become project experts. The project people develop the requirements first and then later get the high-powered tech people involved. People can’t all be involved in all the projects.
He has taken over the intake process on projects. He was able to start pushing back on projects that IT couldn’t do or that didn’t have business value. Some projects are clear & simple to do. It’s better to get out in front of what attorneys are asking for. They have some Microsoft project software. It manages intake, review, approvals, and status reporting after project is complete. They are progressing in IT, but the business side of the firm is moving a little slower.
He’s had to sell the concept that projects are a way of adding value to the organization. People take a long time to get this, and are used to working in the old reactive way.
He thinks that law firms are behind corporate America in incorporating architecture and project planning into their work.
All the managers and directors have been sold on project management skills, and took 5 2-to-3 hour project management classes (10-15 hours).
The Project Management Office is one person. Project Management is embedded in every project. Each “large” project has a dedicated project manager.
The global Baker & McKenzie operations does an audit of each area every few years. They’ve centralized information management on a global basis. It has worked really well.
They are using Sharepoint to develop workflows. Staff intake and departure processes are both getting set up in Sharepoint.
He gave as a sample facilities project their server virtualization project that started in January 2007. (They moved from a level 2 to level 3 on the CMMI scale). They needed to scale up staff to support virtualization, and hired staff with experience in that process and invested up front in lots of training. It was hard to measure time-based ROI because the “virtual” servers are all mingled together on hardware. There were clearly saving financial benefits and attained a 10:1 server ratio, whatever that is.
Another benefit was 83% power savings. They develop data on carbon footprints, but Brent couldn't reveal how the calculations were made.
His office virtualized every server but those for Elite and DMS. They have virtualized their SQL databases.
Brent developed his own office's project management complete with dedicated project coordinators. Project sites set up in Sharepoint. Things are centralized in one place. They’ve sent all management staff to project management training. PM is getting pushed onto IT. One person oversees tracking of all projects, but the project coordinators are responsible for the projects.
This was an outstanding session, with real CIOs talking about real issues they faced and overcame. I called my firm's resident project manager into this session from another one, and he was quite happy that I did so, even though he only caught the last 40 minutes.