Tuesday, August 28, 2012

ILTA Session: Aligning KM With External Client Expectations

Formal Title:  Why IT Doesn't Matter and KM Matters Even Less To Clients:  How To Align Services With Expectations

  • Felicity Badcock, King & Wood Mallesons
  • Risa Schwartz
  • Sally Gonzalez, CIO, SNR Denton
This session by an all-star set of knowledge management leaders addressed client perspectives on internal initiatives and highlighted some successful KM initiaves in law firms and law departments.  What follows are my notes from their session at ILTA conference today.

Sally Gonzalez

Ms. Gonzalez has seen three stages of KM.

The first stage involved capturing knowledge and professional development & training.  They did it in the U.K. because they were trying to manage risk.  U.S. lawyers were trying to be more efficient, an uphill battle under billable hour regimes.

Around 2000 law firms started to focus on business development and marketing. Information about people and matters became more important.  Sharing knowledge about the work and about firm relationships became important.  CRM systems were implemented, often not by KM.

Marketing started to understand the intersection of KM and business development.  Freshfields looked at what the client wanted.  They didn't want generic broadsides, they wanted content tailored to my company and my jurisdictions [Ed.--how does firm get to know what specific clients want to know about?]

Around 2008 a seller's market for legal service turned into a buyer's market.  Law firms used to control basic structure and processes of legal work, which was done under a billable hour model.  With the buyer's market, client demands for efficiency and effectiveness have increased.  Corporate legal is under price and cost pressure.  That's turned into across-the-board demands for efficiency and effectiveness.  Firms are beginning to be more efficient and new legal service providers have emerged.

Commercial risk, not legal risk, now drives law firm KM.  The client cares that you are providing the right level of legal service at a good price.

With this shift there is arising a third phase of of KM.  Traditional KM skills are being applied to the budgeting/pricing context.

So what do clients want now from in-house KM and from outside counsel's KM & IT departments?

Risa Schwartz

Clients want in-house staff and law firms that know their business. 

Clients other than HP hire people from law firms. They are typically hiring people who understand sales contracts and the life. What they don't know is how Cisco vs. Apple vs. Google negotiate sales contracts, in other words, they don't understand the business. 

Law firms and clients should define "how can everyone on the team get up to speed on the industry?"  Lawyers need an *intimate* understanding of the client's business.  

Knowledge management and technology staff need to get closer to the business people.  Some KM staff were hired without legal or business experience (technologists).  Partners would not talk to them and share their expertise and knowledge of the business.

KM initially reported to the IT staff.  That was understood as only occasionally successful.  The landscape is littered with KM and IT project failures.

KM is now more often reporting to the managing partner.  Sometimes they also report to the marketing group.

Felicity Badcock

Ms. Badcock is Head of Knowledge Management at King & Wood Mallesons, an Australian / Asian-Pacific firm well-known for its cutting-edge knowledge management program.

A survey of the Australian Legal market indicated that the 2008 recession drove a change in what buyers were looking for from reliability as the first criteria to understanding the business and industry of the client.  Price also became a factor where it had not been before.

King & Wood Mallesons has a Knowledge Management, a "Business Development and Marketing," and "Legal Logistics" groups all reporting to the Managing Partner for Clients and Matters.

KWM has reorganized around key sectors and industries.  With clients as the focus rather than the practice it increases the ability to anticipate client needs and know the industry.
Partners are affiliated with a primary sector and a minor sector as well as a practice group.  Sectors get a lead partner, business development assistance, learning & PD, and KM support.  Revenue is reported on a sector basis.

KWM has developed an enterprise-social-network-style sector community pages that let you see clients, people, and updates about that sector.  The ESN encouraged the sharing of information around the sectors.   They also rolled out ESNs around practice areas.  This is a new way of communicating. Updating information is seen in the context of the sector or practice. They've seen some good knowledge sharing on these sites that has led to additional work or better client service.

They've developed guides to help junior attorneys conduct industry research. 

Another tool is after action reviews.  There are four types:
  • Client-facilitated
  • Internal facilitated
  • Internal-team reviews
  • Internal self-assessments (partner)
The theory is that the more a firm understands about the work that it's done the more it can use the information to improve service on the next matter.

A full debrief pulls together lessons learned, financial profiles, client insights, matter profile, market profile, and knowledge sharing.  The market profile looks at matters that might be innovative and/or have a good story. 

They are trying to embed the process of internal review into the way they do work.  

They share reviews through improvement opportunities, lessons learnt stories, media opportunities, and the like.  They look across lessons to identify common trends and issues, and try to fit the appropriate lesson learned to the level of the organization (sector, practice area, firm).

Risa Schwartz

Risa addressed some examples of successful legal  km projects that involved clients.  Unfortunately she was not able to provide the identity of the clients or firms involved.  I have previously blogged about some of her work at Cisco.

Most law departments have a static deal room.  A successful program at a legal department asked M&A attorneys.  They said they were waiting for an email from outside counsel.  Sometimes outside counsel don't know when the general counsel need what. 

A simple SharePoint site let law firm attorneys update information about hot documents and key deal issues on a site that automatically notified in-house counsel.  It was built jointly by law firm and in-house counsel.  The technology saved a few weeks of time and a lot in legal bills as well.

In litigation people are desperate for information about related cases.  In-house counsel may not be able to find information about comparable cases.  Sometimes clients need law firms to build sites or themselves host sites with information about the matter. 

Outside counsel can work with in-house counsel, asking what is useful for the business, starting with the general counsel and getting down to the individual counsel. 

It's very difficult for in-house counsel to manage subsidiaries.  Orrick's system identifies approved lawyers in different countries, for the subsidiaries.

Training needs to identify the business of the client.  Some training programs have been built on client intranets.  Some have dealbooks.  Better dealbooks are on updated platforms such as wikis.  Standard clauses, fallbacks, and negotiated points are all on these wikis.  Outside counsel can be given access to the wiki, both to supply answers and to learn about the business.  Discussion forums also might address specific topics such as clauses within sales contracts.

When an extranet is well-built, clients are willing to overlook their usual preference for sites that they host themselves.

Volunteering to conduct an information management or KM needs assessment at a client is a good way for a law firm km person to start the conversation with the in-house KM person.

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