VANTAGE 2015 INsIGhTs ANd OuTlOOks REpORT

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This report summarizes key challenges and opportunities on the horizon in the legal industry. The information is based on direct feedback from the 96 individuals who joined the Insights and Outlooks sessions at the Thomson Reuters Elite VANTAGE conference held in las Vegas in June 2015. some individuals attended more than one session, and an average of 15 participants attended each session. This series of sessions was an opportunity for peers to share knowledge with each other on the key topics and trends described in the report.

OppOrtunities and Challenges On the hOrizOn

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What did they discuss?The seven sessions focused on the topics below. sessions resulted in roundtable style discussion among peers, moderated by a subject matter expert from Elite.

1. Mobile beyond time entry

2. Front office of the future

3. serving today’s client successfully

4. driving business development technology adoption

5. The lawyer’s technology “wish list”

6. Measuring business development success

7. law firm security “stress test”

18 C-level or director-level titles (CIO, CFO, Dir. of Finance, Dir. of Marketing, etc.)

47 manager-level titles (Systems Manager, Controller, BD Manager, etc.)

29 professional-level titles (Financial Analyst, Elite Administrator, etc.)

2 Lawyers

Who ParticiPated?

17 people from firms with 600+ lawyers (largest firm had 2,000+ lawyers)

18 people from firms with 301–600 lawyers

21 people from firms with 100–300 lawyers

40 people from firms with less than 100 lawyers (includes some professional services organizations with zero lawyers)

What firms and businesses did

the ParticiPants come from?

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MObile beyOnd tiMe entry

hoW much demand is there for mobile use today, and hoW much do you exPect in the future?

mobile usage today?how many lawyers use mobile to enter time? Not the majority, but many are starting to.

mobile usage next year?There will be pressure to use mobile in about one year, but not right now. some firms will not buy new solution unless it has a mobile component.

Who uses What device?

•Mixedacrosstheboard

• Blackberryisdeclining,althoughstillpopularwithsomelawyersduetotheeaseoftypingwithBlackberry’skeyboard. One firm commented: “we officially banned BlackBerryusageforthefirsttimethisyear”tocreatemore consistency across the team’s devices.

most popular devices discussed include:• Smartphone–iPhonesarepopularwithsomelawyers

• Smartphone–Androidsmartphonesarepopularwithsome lawyers

•Tablet–iPadispopularwithsomelawyers

up-and-coming device:• SurfaceProtabletisrapidlygaininginpopularity—this

device has more laptop-like functionality than an ipad, so the surface pro may actually have the ability to replace the laptop. lawyers get frustrated when they cannot perform certain tasks on an ipad, such as editing a document. Those limitations do not exist in the surface pro.

Key mobile use cases, other than recording time:

• Financial metrics. during new business intake, it is beneficial to provide lawyers with mobile access to financial data such as kpIs that show whether the client is up-to-date on payments. This will help determine whether to take on more work with the client. (Already exists/Note: Elite Mobile already displays this information by pulling directly from 3E)

• Data security. The device must ensure data security, so Mobile device Management (MdM) is a focus. MdM providers such as “Good” and “Airwatch” provide capabilities such as remote wipe, kill switch to mitigate potential risks of mobile devices.

• Conflict search. during new business intake, it would be beneficial for our lawyers to be able to do a quick and easy conflicts search to know whether a new opportunity is viable.

toP taKeaWays1. demand is about to spike.Today,onlysomelawyersusemobileregularly.Butthetippingpointisaboutone

year away.

2. mobile devices are no silver bullet…yet.ButSurfaceProhaspotentialtomakelaptopsobsoleteforlawyers.

3. Which device is most popular in law firms? There is no clear winner just yet.

4. security, security, security. Every firm is investing in mobile security, including Mobile device Management (MdM) systems, such as Good and Airwatch.

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Key mobile use cases (con’t.)

• Proforma edit. Our lawyers like to be able to edit proformas on a tablet while in transit.

• “Graded offline abilities for mobile.” Allowing some access to data offline, but not full access. For example, allowing client and matter information to be stored offline, but not documents.

can a laWyer Practice laW With just a tablet or smartPhone?

•Notinmostcases.

• IOSandAndroidsmartphonesandtabletsaregreatforactivities above, but not for editing documents.

• Howarefirmshelpinglawyersgetthemostoutof these solutions?

- Education–whatyoucanandcan’tdowithyour mobile device

- Early adopter program and/or Mobile committee

• SurfaceProisonetabletthatisgreatforeditingdocuments

What benefits or challenges exist When WorKing offline on mobile devices?

• Itwouldbeahugebenefitfromaproductivitystandpointto have offline mobile capabilities. lawyers in transit with no signal or variable signal could then continue to complete tasks on their tablets and smartphones uninterrupted.

• Butthemajorchallengeisnotputtingsensitiveinformation at risk. For example, it would not be acceptable for a lawyer to work on a document relating to a client’s patent information by using a mobile device. It would be important to ensure the device’s cache is cleared and the appropriate safeguards are in place.

other insights:

A single point of access is important for efficiency (don’t want to log in and out of 5 different applications for tasks), but single point of failure is unacceptable from a security standpoint.

“ like the idea of voice entry. lawyer can just speak and enter time while driving or in cab.”

yes3 considering17 not considering0

WHIcHfIrMSAlrEAdyHAvErOBuSTMOBIlEcAPABIlITIESASPArTOfyOurfIrM’SENTErPrISEBuSINESSSySTEMS?

“When we are looking new technology now, we will not consider buying if it lacks mobile capability.”

“Our summer associates did not know how to use a PC… all they knew was Mac.”

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FrOnt OFFiCe OF the Future

What does “front office” mean to your firm?

• Ourfirmdoesnotusethatphraseatall.

• Iknowwhatyoumean,butpartnersandexecutivesdonot use the term “front office,” and would likely not know what that phrase means.

• Itmeansclient-facing,likesecretaries,etc,

• frontofficeactivitiesincludethingslikecalendarmanagement, filing work, document generation, etc.

• lawyersmaynotthinkofthemselvesaspartofthefront-office experience, but they are because they are client-facing. Our lawyers actually want to see statistics and other key performance indicators (kpIs) that help them work with clients more effectively (e.g., see realization of their rates).

What role does business develoPment Play in the front-office?

• Businessdevelopmentispartoffront-officeinthesensethatitisaboutgettingmoreworkinthedoor—thisisabigfocus for management.

• Weareinvestinginbuildingabusinessdevelopmentteamthatcanmakeclientcallsforexactlythisreason–generate more work.

• Toalignfocus,wehaveabusinessdevelopmentcommitteethat includes managing the partner, the practice group head, and lawyers. We are starting to measure what business development activities lawyers are doing, and what new work resulted from those activities.

hoW Will front-office technology change in the next feW years?

business development will need to sync with financial systems• Wewanttoseetheactualfinancialpaybackassociated

with business development activities and marketing activities, such as email campaigns.

front office systems will need to be more user-friendly• completingataskshouldtakefewerclicks.

• Ourlawyersneedthesesystemstobeassimpleandeasyas possible. iphones, Google, etc., have set the bar for user-friendly experiences. Our front-office technology at the firm should be like that too.

toP taKeaWays1. the meaning of “front office” varies from firm to firm or is not used.

2. systems will need to show more clearly what financial results come from business development activities.

3. Front-office systems must become much more user-friendly in the next few years.

4. The ability to slice and dice case load and experience data is increasingly important.

“ We want a way to easily see how much each attorney is spending on his or her own business development activities. 3e should sync with business development Premier to track this. or, for firms that use Prolaw, we want a way to track this in Prolaw.”

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Prioritizing front-office enhancements: What change do you need the most?

• Asdiscussedabove,weneedmetricsthatshowrOIforbusiness development activities.

• Needtoseecaseloadmetrics,suchasnumberofcases,duration of cases, and the type of cases being managed.

• Weneedtoautomatethecollectionprocessbydoingthings like auto-drafting the collection letter.

• legalProjectManagement(lPM)portalforourlawyersto manage matters more effectively.

• furthermore,weneedtheabilitytoautomaticallytracknot only how one piece of work originated, but we need the ability to easily slice and dice data about the “profile” of our combined experience. For example, we should be able to report on how many cases we have had on this type of matter, in this jurisdiction, in front of this judge. We need a way to collect and report this information.

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serving tOday’s Client suCCessFully

What does your firm have to do differently noW to satisfy clients?

• Discounts. Ever since the financial crisis, we have had to offer clients discounts and alternative pricing, and that trend continues to accelerate.

• Transparency. Our clients want regular visibility into how much they are being charged for what.

• Better reporting and portals. This is one way we must deliver more transparency. We provide more frequent and detailed reports. In some cases, we provide the client an actual portal in which they can see a real-time financial dashboard showing how much has been billed to a matter.

What is your firm doing differently to develoP neW business noW?

hiring new staff for pricing department, and educating existing staff. Again, we need to discount to win work, but our lawyers and even our billers did not all know how to price discounts while protecting profits. We needed to invest in educating existing staff and hiring additional staff to support this need.

hoW has technology imPacted the Way you serve clients?

e-billingClients love electronic billing, which presents opportunities and challenges. E-billing is much more efficient and easier totrack.Butsometimesane-billingerrorcanactuallyoccuras a result of the client’s e-billing vendor, and the client will believe the error was caused by the firm. Clients want e-billing, so we have to do it. Overall, e-billing is a positive trend, but we are still working through some growing pains.

data securityWith more and more information being captured in systems, our clients have grown more concerned about data privacy. Financial data from our banking clients, medical data from certain clients, etc. require a high level of data security. We must encrypt everything. When we setup our systems years ago, “security” meant requiring a user name and password. Today, we encrypt everything, and we require two-factor verification for all our systems. Over the next few years, security at our firm will become yet more robust, especially to address mobile data security.

toP taKeaWays1. clients expect discounts and transparency. Almost every firm is investing in pricing systems and staffing to

deliver discounts while also protecting the firm’s profits.

2. government regulations regarding “benefit-based” taxes add time and cost to legal matters.

3. millenial lawyers are (on average) quick to adopt new technology but slow to master personalized client communication.

4. the demand for data security is ahead of the technology. Clients that posses financial data, medical data, or other sensitive information are expecting higher levels of protection against data breaches.

Note: For the purposes of this session, “client” refers to both internal clients (e.g. a firm’s own lawyers) and external clients (the firm’s patrons)

“The size of our pricing department doubled to manage the alternative pricing and increased reporting clients now expect.”

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have generational changes affected client needs? for examPle, millenials noW maKe uP the largest Part of the us WorKforce; has that imPacted client dynamics?

• Younger lawyers adopt new technology more quickly, as you would expect. They are more comfortable with paperless workflow in tools like paperless proforma. Also, they prefer to enter time on their mobile devices, which is made even easier by mobile solutions, such as IntApp, that regulate mobile time entry to prevent incorrectly recording time.

• Younger lawyers are not usually as skilled at face-to-face communication. The younger generation prefers email and other digital methods of exchanging information. some firms are beginning new educational programs to help younger lawyers improve their face-to-face and phone conversations.

have government regulations affected client needs?

• Law firm advertising regulations are behind the times. The reality is that many firms attempt to connect with clients through social media and online advertising. That is against regulations in certain states if you follow the letter of the law. For example, disclaimer language would need to be included after every post on Twitter, but that is simply not practical. The regulations need to be updated. state bars have not addressed this issue yet, but it will be interesting to see what happens next.

• US state tax codes are becoming more onerous for firms due to “benefit based taxes.” For example, some states in the us are now requiring that taxes be paid based on where the benefit of service was received. so, imagine a law firm based in Oregon serving a client based in Oregon, but the legal service results in a benefit for the client’s seattle, Washington office. Taxes would actually need to be directed to seattle, Washington to comply with Washington state law. Which states impose this regulation can change from year to year, and the specifics change from state to state. Tracking the location of such benefits to comply with this regulation is complex and requires more resources from the firm.

• Global tax codes require allowing close oversight from certain governments. For example, when we do business in Mexico, we actually must allow the Mexican government to invoice our clients on our behalf, so that they can track all billings for tax purposes.

“Clients always want to know about our data security. The demand for security seems like it is ahead of the technology available.”

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driving business develOpMent teChnOlOgy adOptiOn

hoW do you convince your firm to invest in bd technology?

• Myconversationwithmanagementis:ifyoureallywantbetterreturnonBdactivities,weneedyoutoinvestinbetter technology. (director of Marketing, Mid-size us Firm)

• Ialsohelpmanagementunderstandthatwithoutbettertechnology, we have limited ability to track true ROI of different business development activities. We track activities (e.g., lawyer goes to three events to develop business), but we need a true campaign management system to track ROI (e.g., new work generated over time due to three events)

hoW do you choose a technology solution?

• WereviewopinionsfromindustrypublicationslikeGartner.

• Wetakeintoaccountreferralsfromourpeers.

• Weevaluatehowwellnewtechnologywouldintegratewith our existing systems.

once you select a neW bd system, hoW do you build adoPtion in your firm?

“bottom-up” – start small. Introduce the technology to a small group of interested lawyers and cross-functional teams. Coach this group on how to get the most value out of the solution. Once this group is successful, invite them to share success stories with the rest of the firm so they can help evangelize the benefits of the technology.

“top-down” – management champions project. having members of management communicate that using the business development technology is a priority for the firm—andwhy—canreallyhelpdriveadoption.One

suggestion: send a short video featuring an interview with management on these sorts of topics. This is easier to consume than a long email written by management.

Keep it simple.If something requires training, our lawyers won’t use it, or won’t use it for a very long time. That is one of the things we likedaboutBdP—wecanpullituponaniPadanditisveryintuitive to use.

friendly rivalry. Award prizes to individuals who achieve certain goals with the technology, as most lawyers are naturally competitive.

show value! As a business developer, the lawyers and partners are my bosses. I want to invest in this technology to help them be more successful, so I show them how better reports and intelligence can help them actually win more work.

hoW do you manage “Private contacts” When trying to groW your bd system adoPtion?

Privacy settings. AdvancedBdsystemslikeBusinessdevelopmentPremieruncover key relationships that can help develop new business, but if certain relationships are truly private, those contacts can be excluded from the system. For example, one a partner at a certain firm works with a few “A list” celebrities that must remain confidential. To ensure only the partner and her secretary see these clients’ names, those contactsaremarketprivateandexcludedfromBdreporting.

toP taKeaWays1. Prove roi in order to get management to buy in.

2. Once management buys in, “bottom-up” and “top-down” approaches should be combined to drive adoption of new business development technology.

3. Intuitive technology means you should be coaching, not training, to drive adoption.

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the lawyer’s teChnOlOgy wish list

What Processes do you and your laWyers Wish technology could change?

• Marking up proformas. The paper workflow of printing, marking up, processing and finalizing is manual and tedious. lawyers want this to be easier, and they want it accessible and editable from tablets.

• Matter intake – searching. Our lawyers currently have to look across multiple sources to determine whether a new matter is a viable opportunity for the firm. lawyer may need to look in financial system to see if client is current on bills, then look in another place to see which team currently serves the client, then a conflicts search must be performed. It would be great if there were one place do source all this information with a simple search.

• Matter intake – initiating. Our lawyers have to enter some data in order to officially begin a new matter. For example, if dealing with a personal injury case, lawyer must write-up the type of injury, reason for the injury, cost implications, etc.. lawyers do not want to do clerical work, and they are generally not suited for clerical work.

• AP Voucher Approval. Our lawyers did not like needing to log into our financial system to approve an Ap Voucher. We were actually able to fix this. Now, 3E emails the approvals to our lawyers, and the lawyers can click a button to approve directly from their email.

• Mobile workflow. Our lawyers wish they had the option to do everything from their tablet or smartphone. Mobile is fine for email today, but it does not allow them to check matters or markup documents, which is a huge complaint. document markup in ipad is our biggest request.

• Less paper in meetings. One firm had a meeting with all major partners, and handed out ipads with all meeting documents pre-loaded, rather than printing the documents. Now, everyone in the firm wants to do meetings this way.

What Processes do your laWyers Wish they never had to do again?

• Time entry. Our lawyers enter their time because they must, but it is an obligation they could do without.

What technology Would be missed most by laWyers if taKen aWay?

• Email. Our lawyers absolutely depend on email. They use it all the time when on-the-go, and they use it in the office. There would be a revolt if email went down.

• Document Management System (DMS). The dMs is a necessary evil. Whether lawyers like it or not, they depend on our dMs as a key resource.

What tyPe of data security do laWyers Want to have?

They want good security, but they also want ease of use. They would prefer to not even need to log in with user name and password, let alone provide additional verification beyond that.

toP taKeaWays1. lawyers wish technology could simplify and speed up matter intake.

2. tablet document markup capabilities is a top request from lawyers.

3. lawyers wish they never had to enter time again.

50% of firms in this session allow “local save” functionality as part of document management system. Others do not allow due to security concerns.

50%

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overall, hoW extensively have your firms adoPted technology solutions to suPPort the business develoPment and marKeting functions?

most firms say technology is used moderately.• We’veusedInteractionforyears.Thereportingisa

manual process, but we make it work.

• WeareintheprocessofimplementingBusinessdevelopment premier. We used to have a business developments system that was just used to prep pitches forthelawyers.WithBdP,weplantouseanend-to-endbusiness development system that also shows us the ROI of various activities.

in Which of the folloWing areas do you feel that technology can maKe the greatest contribution to drive marKeting and business develoPment for your firm?

• Marketing automation. Automating manual processes is the number one benefit that marketing and business development teams are looking for based on feedback from this session.

• Measuring ROI.Byintegratingourbusinessdevelopmentsystem with our financial system, our firm plans to track true ROI of campaigns and other initiatives.

• Competitive intelligence and market intelligence. Marketing is now considered a mission-critical function in our firm, the same way finance is. Getting better market and competitive intelligence is an important part of improving our marketing efforts.

What are some of the toP benefits that your firms have realized from your business develoPment technology solution?

• Cross-selling. Our technology helped my firms segment our client base so that we can cross-sell more effectively.

• Measuring digital marketing success. We are able to run metrics on which articles and content from our website are most popular. Our lawyers are always interested in this information.

• Client insights for lawyers. Our lawyers want to see insights on what campaigns, events, and other activities are resonating with their clients. They actually now want this marketing “dashboard” combined with the financial dashboard they use to see their clients’ billing history and other metrics.

other insights

Although cross-selling is a priority, it can be a challenge to get the lawyers to buy in initially. some are reluctant to share“theirclient”withotherlawyers.But,onceafewcross-selling successes occur, the initiative will build steam.

• changingcompensationisonewaytohelplawyerstocross-sell.

• Somefirmscompensatelawyersonorigination credit. If more than one lawyer can claim origination credit, those lawyers typically must negotiate with one another on who should claim what amount of the credit.

• Alternativecompensationmethod:the“Citizenship” approach. This approach would cause lawyers to earn credit for new business based non only on origination, but also on how many interactions the lawyer has with a client, how many previous matters the lawyer has worked with the client to retain their business, etc. This type of system could be tracked using the firm’s financial system, business development system, and business intelligence system.

Measuring business develOpMent suCCess

toP taKeaWays1. Firms indicate only moderate levels of business development technology adoption.

2. Technology’s biggest impact on the business development and marketing teams is automating manual processes.

3. improved cross-selling is the top benefit of business development technology.

of firms in session are discounting rates due to increased competition100%

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law FirM seCurity “stress test”

What are the Primary security concerns in your firm or industry?

concerns range across a variety of topics. human error, cyber attacks, outdated systems/protocols, unauthorized access to client files, file encryption, hardware theft, client record disposal, mobile device management (ByOdPolicies,etc.)

top concerns:• Password sharing. Our lawyers and other professionals

share passwords with one another, which is a significant security concern. It is ironic that we spend so much time and money on software security only to handle passwords so carelessly.

• Disabling User Account Control (UAC). At some firms, lawyers do not want deal with the uAC pop up, so they will turn it off, which is a security risk.

• Compliance with Health Insurance Portability and Accountability Act (HIPPA). Firms must ensure data security meets standards of hIppA. hIppA audits are typically very thorough.

• Mobile device theft and loss. If a device is lost, we must be able to track it and “wipe” it remotely to remove any sensitive data.

• Phishing and Spam. Emails that trick our staff into opening a virus or providing sensitive data are an issue.

• Record disposal. paper records and digital records must be archived or destroyed regularly to protect confidential information.

hoW imPortant is cyber security in your overall risK strategy?

• Cyber security has become a major priority over the past two years, largely due to high-profile data breaches like those at Target, home depot, and various us Government offices. These breaches highlight the need for better security. Firm management’s perspective is “do whatever you have to do make us secure.”

• Cyber security is a priority for all firms now, but it is managed differently depending on the size of the firm

- larger firms have security officer that typically reports to CIO.

- Mid-size firms have a smaller IT group that will include securityaspartofitscharter.But,asmallerteamisunlikely to have a dedicated security officer.

toP taKeaWays1. management is investing in cyber security in the wake of recent breaches.

2. regulations like the health Insurance portability and Accountability Act (hIppA) amplify the need for investment in security.

3. security departments are staffed and structured differently depending on firm size.

4. security challenges are broad and varied, so the responses must be as well.

50% of firms in this session block access to personal sites like Facebook and Netflix from firm-owned devices.

50%

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hoW does your firm address Prevention?

increased size of security departments

“The size of many firms’ security departments

have doubled over the past five years.”

updated systems.There is more of a push to be on the latest systems to benefit from the improved security features new technology has to offer.

increased email security• EmailsecuritysystemslikePostini(recentlyacquiredbyGoogle)andBarricudahelpmitigaterisksofSPAMandphishing emails, but they are not foolproof

• OurITdepartmentwillactuallysendfakeSPAMtothefirm, track who falls for the trick, and then report the results. This sort of “public shaming” has been an effective way to reduce risk.

education. We train teams on relevant security threats. In addition to training sessions, we send email reminders from senior management to the rest of the firm emphasizing the importance of data security.

systems to protect confidential information:• dataencryption

• useradministration/accessrights

• Twofactorauthentication

• firewalls

• Securitysoftware&monitoring

• recordsManagementPolicies

- We shred paper.

- We destroy hard drives either at the firm or by hiring an agency.

- We wipe copiers, which have more memory as they get more sophisticated. law firms typically lease copiers, so this process should be included when negotiating the lease.

What systems and information does your firm Put on the cloud versus on Premise?

Almost everything is on premise today, but some systems may move to the cloud eventually.

What may move to the cloud or offsite:• Procurementsystem

• documentmanagementsystem(dMS) - One firm discussed how they used to have issues

with Netdocuments, but those issues have since been resolved.

• Industrybenchmarkdata - some firms allow peer Monitor to collect data to define

industry benchmarks. No risk because this is aggregated and anonymized.

- some considering allowing Viewabill to access our information. This allows clients to have visibility into what firm charges for certain matters, which reduces client uncertainty.

What we do not plan to move to the cloud:• financialsystemsanddata

• Email

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