Peer to Peer Magazine

P E E R T O P E E R : I L T A ' S Q U A R T E R L Y M A G A Z I N E | S P R I N G 2 0 1 9 45 sense of security until it was easily defeated in the early stages of World War II. 12 The report theorizes that strategic blind spots, decision- making inertia and unwillingness to adapt strategies to changing conditions can lead decision makers to ignore signs that the world has progressed, and current strategies may not be working. 13 There are other underlying factors at play that help explain the inertia. A key one is that technolo moves exponentially faster than the practice of law. It took ages to get lawyers to use predictive coding even though the technolo had been around for a long time. Why? Lack of planning, training, and comfort have a lot to do with it. When you do not know how else to do it, you keep doing what you've always done. Yes, we know, there are many of you out there still reviewing every document hit by a Boolean search. A Lean approach would measurably improve the document review process. It all starts with team formation and collaboration. Without taking into consideration the end-user's needs, as well as the client's and the case's needs, technolo innovation is futile. Another reason why firms have been slow to adopt business innovation into the practice of law is because they do not believe the traditional law firm model is dead. After all, the 2019 Citi Hildebrandt Client Advisory Report, an annual survey of law firm fiscal performance, showed robust growth at U.S. law firms. When you scratch the surface, however, you see that the growth is centered around Am Law 100 and Am Law 50 in particular; that is, only those few firms that are still able to sell their "bespoke services" to GCs with bet the company litigation are performing well. Other data sources indicate a widening fiscal separation between the cadre of "elite" firms and the rest of the pack. 14 A Forbes report points out that the 6.3% revenue growth of the firms surveyed is offset by a 5.9% increase in costs, yielding a minuscule 0.4% increase in profits. "Longer collection cycles, declining realization, and 'dispersion'— the near-even split between firms that see demand increase and firms that see demand decline year-to-year— tell a different story than the Report's bullish headline." 15 Also, "equity partner headcount declined by 0.3%, a continuation of a seven- year trend where equity partner numbers have remained flat, but leverage (non-equity billers) has increased. That's a good way to prop up profit-per-partner but not a long-term winning strate." 16 Law firms should act proactively and examine their processes for delivering services. "Plan, Do, Check and Act." Using Lean in legal processes is the right step to remain competitive and retain market share because by applying Lean you will increase efficiencies and optimize your resources. Lean requires little investment, it tells the client that you are listening, it increases lawyer satisfaction and it promotes team work. Best of all, it is simple to implement. Applying Lean to Legal Processes One of our virtues as lawyers is our skepticism. If you bring Lean into the conversation, expect the following reaction: "Do we need it? Will it make a difference?" And, my personal favorite, "Why can't you just let me get back to doing real work?" To show how Lean can make an impact, let's consider examples of the types of DOWNTIME we see every day and consider the costs to your client: • Defects: unstructured data is misfiled and cannot be located; data entry mistakes; production of privileged or nonresponsive documents; budgets are not met. • Overproduction: lawyers operating in silos, researching or drafting memoranda on the same issue; lawyers turning every stone when they already found controlling case Another reason why firms have been slow to adopt business innovation into the practice of law is because they do not believe the traditional law firm model is dead.

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