Legal Project Management

Susan Raridon Lambreth of Hildebrandt Baker Robbins presented on legal project management (LPM) at a meeting of KM peers this morning. She is an effective (albeit extremely quick-talking) speaker, and seems to have found an effective approach to communicating LPM themes and approaches to lawyers.

What is Legal Project Management

LPM is a "disciplined approach to the management of legal matters." We have to acknowledge that lawyers have been successful in managing legal projects before the formal application of LPM. In training LPM don't suggest that they have been doing everything wrong. Emphasize that LPM will enhance communications with clients and managing client expectations.

Process Improvement and LPM

Process improvement might be better tackled before LPM improvements. Many law firms have gotten on the LPM bandwagon, perhaps because it is less threatening. You can "back into" process improvement after doing some LPM. Process improvement may lead to greater efficiencies faster.

Drivers

One of the trends driving LPM is client demands for "better, faster, and cheaper." Clients saw more serious economic effects of the recession than the legal industry as a whole did (referred to increased profits at AMLaw 100 firms). Clients expect costs to be lower every year. Clients are looking more for alternative fee arrangements (AFAs).

The profit equation is also changing. Billable hour productivity had been going down. Billing rates were driving increased profitability. This is now flat or down in many firms. Law firms have to get more profits by changing the way that they work. There is also more competition for legal work in terms of outsourcing and aggressive pricing (large firms competing with and sometimes beating medium-sized firms on price).

The procurement offices are also getting more involved in legal work sourcing. Procurement officers may be in a position to put more pressure on outside firms.

Increased client power is driving faster segmentation and devaluing. Work even within a high-priority matter might get broken out or segmented, so that "trusted advisor" work would be compensated or sourced differently than the due diligence or filings work. The more strategic, high-value work is not getting bigger and may be shrinking. Operational or routine work might be expanding. Lower-tier work can be more highly leveraged. Some litigation practices can be very profitable, with the right work / staffing structure.

She considers project management to be not a business-world "fad" (like TQM?), but a natural evolution of application of certain tools and disciplines, already in place at the practice or department level, to the matter level. Eventually it may be internalized and not broken out as a different aspect of work.

Two hidden benefits of project management are a greater emphases on professional development and knowledge management. It leads to a greater emphasis on training and development for younger attorneys. Associates like being part of a formal project team because of the higher level of communication and awareness of the bigger picture. We can enhance the professional development of lawyers as part of an LPM approach.

She referred several times to the ILTA White Paper on alternative financial arrangement.

You can train LPM as "delegation and communication" skills. HBR's approach to project management breaks down a project life cycle into five phases of Initiation, Planning, Executing, Closing, and Lessons Learned. It's best to teach LPM without using PM jargon. They had left in the term "stakeholder," and despite some objections at a NY meeting in June it turned out that lawyers didn't mind that term.

She outline four approaches to early adoption of LPM.

Training and Education

Early adopters of LPM are starting with training and basic education. A 2-3 hour session is not really training, it's more education about "what" than "how to." It's more effective to get people to volunteer for LPM training. It can also be effective to build LPM skills into competency models for lawyer development.

Pilots

Other early adopters are trying LPM in pilot practices, such as with commercial litigation or other specific practice group. Groups with more client pressure (as described above) are more interested.

Technology / Software

Only a small number of firms have effective budgeting or project management software. Some have done historic data / analysis and others have done several years of tracking with ABA task codes or e-billing vendor codes. Litigators seem to be more on board with this in many firms, because they've had to do a tremendous amount of budgeting. In many cases they have not had to stick to those budgets, until the last two years. Budgets are now treated by clients as fee caps.

Staffing

Full-time project managers are in place at a few firms.

Lessons Learned

Don't make LPM seem mysterious. Attorneys may need support like staffing, software, and other "handholding" before LPM can be broadly adopted. Training associates where partners are not on board can be really challenging.

Adjusting compensation structures may be necessary to reward efficient practices. Client and matter profitability is increasingly the focus of compensation committees. Having partners more accountable for the profitability of their matters is an increasing trend. Some have started by making the information available but not tied it directly to compensation.

For some partners LPM might seem like fundamental change.

Initiating

The challenge for law firms in initiating projects is to slow down and more thoroughly explore the in-scope / out-of-scope parameters of the engagement. An engagement agreement is equivalent to a project charter, although typically in law firms they are much less detailed than a good project charter would be. Exploring detailed client expectations such as "what does success look like to you" (or the in-house counsel's boss) is really important and often neglected.

Planning

Law firms have done a better job at budgeting than at planning. Developing a schedule is often not done well. They don't or can't look back at previous matters and figure out what went well and was completely in a timely fashion and what wasn't. Communications planning needs to be set up for contacts with the client and internally with the matter team.

She showed a couple of examples of "work breakdown structures" that tie into a detailed scheduling processes (like phases and tasks of a matter).

Executing

Avoiding conversations where attorneys talk about increased work with clients is really common. There often weren't conversations about monitoring schedule and expenses.

Closing

They have separated out closing from lessons learned because they deserve extra emphasis in law firms due to their culture.

Lessons Learned

An after-action meeting could be 10 minutes or an hour. Talk about what went well, what they could have done differently. It's hard because lawyers don't like critical feedback. Lawyers are afraid of what might be discoverable in a malpractice claim. Get them to look at how it helps their team or other teams in the future.

Challenges

Who will pay for time spent on LPM tasks? Will clients pay for it? (There is an ABA code, some clients are willing to pay if it LPM is actually being done). There is a sense that LPM will make the work more "cookie-cutter." The greatest motivator for lawyers is their relationships with clients and their sense of accomplishment and professionalism (though they are also driven by relative compensation).

Making "best practices" and sample forms available without much effort can free up lawyers to do more interesting and significant strategic thinking about their matters.

Getting lawyers to work teams can be hard because of typical lawyer personalities and law school training. They teach "anti-teaming" in law school. Lawyers are contrasted with "non-lawyers. She was asked "do you mean that I'll have some project management geek telling me what to do?"

The biggest change will be moving to profitability analysis for compensation, as old metrics of production and revenue will not be as effective.

Keys to Success

Train volunteers. Get firm management buy-in. Give tools and templates matched to their needs (basic versus sophisticated / challenging).