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Specialized in-house matter management vs law firm practice management software

People like the familiar. When former private practice lawyers are new to in-house and contemplating introducing technology to a legal function for the first time, it can seem like the safe option is to introduce the practice management or document management software they used in their past life. Gathering and reviewing technology requirements takes time, so it appears logical to implement something familiar. However, things are rarely ever that simple.

Choosing the right tools for a law department is like deciding which tools to use to build a house. You could use a spoon from your cutlery drawer to dig a hole but a shovel is designed for this purpose. You could use your shovel to drive in nails, but a hammer will work better, more efficiently, and there's less risk of bruising your fingers.

Legal practitioners are generally not trained in project management or change management. They are constantly under pressure to do more with less - including less time - which can result in a rush to implement software without thinking through how it fits the current legal process and requirements.

Given the unique needs of an in-house legal team, it's been my experience that law firm software is often not fit for purpose for the following reasons:

  1. The reports generated, if any, are designed for law firms rather than in-house legal departments
  2. Data entry creates an admin burden
  3. Productivity tools for in-house lawyers are minimal because traditional law firms are habitually not incentivized to work more efficiently

This is because practice management systems created for law firms generally serve a specific purpose – tracking billable units and charging them to a client. So, what does specialized in-house legal technology do differently? Let's look at some examples.

Problem one: The reports generated, if any, are designed for law firms, not in-house legal departments

Legal department technology should allow users to configure their matters for the best processes and workflows to enable them to easily locate and filter matters, documents and contracts across the business. Users can collaborate, track, review and edit all within one platform as well as initiating approval workflows and signatures.

In-house teams should be able to access an updated view of all legal issues across the business which can be filtered to specific stages of a matter lifecycle or the teams responsible for managing them. These reports allow in-house legal teams and the business insight into their transactions and legal issues, and what is keeping the legal team busy.

Once inside a matter/file/case, a lawyer should be presented with everything they need to be productive and get to work. They should be empowered to edit documents, see standard business answers, edit or add additional facts or search for related issues. They can provide and view the history of advice to the business which is tracked for audit purposes. They have editing powers over approval workflows, signatories and signature status, and key dates/milestones with alerts.

Once a matter is completed, it is stored in a centralized system of record so that when an issue arises or it’s time to renew/renegotiate a contract, it is a simple process to go back and look at the complete history from inception, through approval and negotiation to close. This saves time by making it easy to find complete records, but it also gives an organization an advantage to be able to re-secure previously fought positions across relationships/contracts.

Problem 2: Data entry creates admin burden

In a law firm, practice management systems are critical. They help lawyers track their cases and how much time is spent on clients for billing purposes. Billable units are the holy grail of law firms, and lawyers are incentivized to use these systems lest they be seen as not being busy. Over time, these systems have added document management but not much beyond this.

In-house lawyers are busy enough with their workload without having to account for every minute of their working day. The only incentive for legal to enter their matters in these systems is so their work can be tracked and communicated. Modern in-house matter management systems, however, may enable lawyers to record time entries but have more pragmatic ways of highlighting what is being worked on and demonstrating the value of legal.

With software which shows how many matters legal has worked on, the value of all the contracts that have been negotiated, the value of the disputes that have been avoided, legal can demonstrate their worth.

With in-house software, matters are often initiated by the business requesting the services of the legal department. This also reverses the admin burden and encourages clients to gather all the information legal requires to assist their business.

As creating matters requires inputting specific information, the lawyer receives a complete brief and avoids the game of email ping-pong that often ensues with the wider business seeking more information. Additionally, because the same questions are always asked, the business knows what information they need in order to effectively engage legal, resulting in less frustration on all sides. Law firm software does not allow for intake from the business because clients are external parties.

Problem 3: Minimal productivity tools for in-house lawyers

It’s no surprise that there are minimal productivity gains built into software designed for law firms. Law firms' value is demonstrated by billable hours of legal work, whereas the longer an in-house lawyer takes to complete a legal matter or task the more the business views legal as a blocker to competitive advantage. Time is a cost to a business but income to a law firm.

In-house lawyers need to track all their matters, from numerous small complaints through to larger and more complex issues, collaborate with internal colleagues and stakeholders, and provide advice whilst maintaining an audit trail of that advice. In-house legal needs to manage approval workflows to get positions, advice and contracts approved according to their governance processes, to get documents signed by counterparties and internal parties, and update the business on the status of their matter. When factoring in all these responsibilities, the use of tools that make these tasks easier is a no-brainer.

If businesses provide their legal team with the suite of tools as detailed above to make their lives easier, it’s been our experience they will happily create a request via an intake portal. This results in faster turnaround times and the data the business and General Counsel want to measure, improve and communicate the performance and value of the function.

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