Big data. It might be the latest IT industry buzz term, but law firm’s with a good understanding of big data, have the potential to radically change the way their business operates and excel in competitive positioning. By collecting and analysing data from a range of sources, savvy law firms can gain valuable insights that deliver a significant competitive edge.
The amount of data in the world is staggering – and growing exponentially. According to Scandinavian research centre Sintef, 90 per cent of the information in existence has been generated since 2011. Finding ways to capture and analyse this rising tide of information has become a key business challenge.
In any law firm, big data comes from a range of different sources. Client files, archives, timesheet and billing systems each contain large amounts of information. Externally, there are case law databases, social media networks, research papers and media reports.
The power of data analytics
Getting a handle on the big data deluge is not easy. Figuring out what to collect and store is one challenge, but extracting value through proper analysis is another altogether. For this reason, an increasing number of law firms are hiring experts in the field of data analytics. Skilled in the art of mining large data stores, they can provide fresh insights into anything from client profitability to the likelihood of winning particular cases.
An example is US-based law firm Bryan Cave, which has employed director of practice economics Christopher Emerson to help improve profits. According to InformationWeek, Emerson and his team have analysed more than two terabytes of data collected by the firm to figure out ways lawyers can be more productive.
The team has devised a set of tools that analyse timesheets to determine exactly what tasks have been undertaken. This scrutiny allows more detailed invoices to be issued to clients, improving satisfaction levels and ensuring budgets are met.
Emerson’s team works on semantic analysis to automatically predict how much time will be required to work on particular projects, based on previous similar cases. They have also created an automated tool that takes data from various sources and creates summary documents for lawyers.
While Australian law firms have traditionally been slower to adopt new technologies such as data analytics, firms in the UK and US are forging ahead.
“I think analytics is the wave of the future,” said Stanford Law School professor Mark A Lemley, in a recent American Bar Association Journal article. [pullquote align=”right” back=”3″ cite=”Mark A Lemley – Stanford Law School”]“Data allows companies and firms to understand the real opportunities and risks they face so they can make intelligent business decisions.”[/pullquote]
Starting out on a big data journey
While such insights are compelling for any law firm, figuring out the best way to approach the big data challenge can appear daunting.
The first step is to review existing sources of data to determine which hold the most potential value. Sources should include past cases, file notes, billing records and client correspondence. Added to this should be data collected from the firm’s website and social media interactions. These can provide valuable insights into client sentiment and wider community attitudes and trends.
In many firms, these pools of data will reside in a variety of different places. Once identified, they need to be brought together into a centralised store, usually housed on a dedicated computer server. It’s important to take into account here, Australian Privacy principles relating to the collection, use and protection of customer data.
Because the resulting volumes of data are likely to be very large, identifying valuable trends manually is all but impossible. Therefore, specialised analysis tools are put to work to extract useful results and create measurable business value.
The combination of big data and analytics has the potential to reshape the way law firms handle everything from research and case preparation to client interactions and billing. By starting with existing internal data stores, and then adding extra external sources, law firms can gain valuable insights capable of boosting staff efficiency, increasing success rates and raising client satisfaction levels.