Wednesday, May 12, 2010

Customized & Proven Solutions on a fixed budget for data Preservation, Analysis, Review, Processing & Production. No Guessing Required

I recently read the following article and got inspired by the responsible yet two-step response to the question below:

Controlling Legal Costs - Law Firms An Important Voice For E-Discovery Reform , The Metropolitan Corporate Counsel, Inc., Published: May 03, 2010,

Editor: How important do you feel providing hard data on litigation costs to be?

Marketos: I feel it is imperative to provide clients and opposing parties with realistic, hard data on the costs of discovery. The problem, of course, is that the facts (and scope) of each case are unique - as are the proprietary document management systems of each client. Without significant experience in e-discovery, including with e-discovery vendors, their processes, and their software programs, counsel is often guessing in the dark. "Hard data" is usually soft data because counsel underestimates not only the cost of identifying and collecting e-discovery, but of reviewing the data for relevance and producing it. The attorneys' fees associated with document review - including unnecessary and duplicative efforts to review for privilege and substance - is often two or three times the estimate provided to the client.

The integration of Smart Preservation & Collection, Smart Analysis, Smart Review & Smarter Productions provide the framework for building a budget. The concept is simple yet realistic. Human time, human intellect, data hardware, discovery software and data storage are the baseline components of the service provider budget.

ü Time - typically billed hourly

ü Hardware - amortized over 3-5 years

ü Software - amortized over 3 years

ü Storage cost - relative to the space required for the project. A one gigabyte project will require approximately five gigabytes of space to manage the project.

ü Intellect - paid annually

Bridging the gap between profitability and common sense can be tough for most legal services providers. It requires that the provider be in touch with the industry, in tune with internal management, technology and workflow all while understanding and managing the cost of providing each element of service that makes the solution. This requires the provider to own each piece of the process in order to streamline cost to increase the Client ROI and the overall business profitability. In the same sense that legal professionals take risk in selecting an outsource provider the outsource provider must take the same level of risk in return for giving comprehensive services and solutions that are proven by industry standards for a defensible approach to handling the data. Thus giving validity to my previous post series “Why does eDiscovery cost so much?" ... DIY Kits don't come with Experience ...” and Controlling Discovery Costs ... "What's in your toolbox?" followed by “Science of Calculating eDiscovery Volumes and Cost ... How so? ... Really?!?”

There are many products today for legal professionals to wade through the daily storm of responding to and preparing for a legal matter. No matter the size or the nature of the matter there is a constant worry for all … How much is this going to cost and what is the best method to handle? The challenge is even far greater in our turbulent economy and job market as people are being courted everyday to move from place to place and in some cases the cuts cause the workload demand to become unbearable. This leads legal professionals to take a closer look at outsourcing data storage and information management in response to the legal storms.

Depending on the market the choices are vast and risks are even greater. Legal Professionals choosing the wrong outsource partner is a costly decision. How does one truly evaluate several key factors of the outsource partner all related to experience, experience, experience and stability of the company? Once you get past the initial sales professional … check out the project management, production and technical team … often referred to as the heart of the organization … Does the level of knowledge resonate through the entire organization or does the buck stop at the top brass without ever traveling downstream?

The reality for most is that larger providers of legal support services have reduced staff for software, scaled back on their speed of service and shifted to a nickel-dime cost structure model masked by a new ‘buzzword”. Rather than moving forward there has been a reversion in thought; the slow death of the per gigabyte cost structure is giving a new life to the per click model of years past. The per click model is being viewed and presented as predictive. Predictive!! How so? …This is quite hilarious. For example, what is the effect during discovery when it is determined that 40K excels files (@ 19mb each or ~700gb) are responsive to the production and require conversion? If handled improperly the cost of discovery just got out-of-control.

‘Solution’ is an easy term to use in the course of business. Is the solution limited to the off-the-shelf software or is there true inspiration innovation and the ability to implement customization based on the desired end result? How is the phrase “if it ain’t broken don’t fix it” interpreted? I like “if it ain’t broken, when will it break? So let’s keep making it better so it won’t break”

Too many focus on the buzzwords …. You know them…

Ø Content Analysis

Ø Early Case Assessment

Ø Email Threading

The intent of the buzzwords is to bring awareness to a particular service, solution or feature about the discovery phase of the EDRM. Instead this author believes that focus and emphasis need to be placed on controlling costs related to overall information management. Thus setting the standard for how the EDRM will facilitate throughout the legal process. The paradigm shift will happen when “e-Discovery” service providers get daring enough to take a close look into their business model and define a fee structure based on evidentiary device and storage with true project management costs.

Disclaimer: By no means does the author imply that just any entity can do e-discovery as it does require years of experience and more than just pushing-a-button. Nor does this author suggest that every company can be profitable by providing a fixed fee cost structure for comprehensive discovery services. The author’s comments/opinions are directly based on actual experiences, client feedback and personal expressions of the author.

For additional information on establishing a realistic discovery budget send a comment to the author.