publication of the International Legal Technology Association
Issue link: https://epubs.iltanet.org/i/192213
SHELTER FROM THE STORM: RISKS AND REWARDS XXXX OF UPDATING NEW BUSINESS INTAKE This rise in interest likely results from a shift in perspective. Historically, intake focused on gathering basic information about new clients and matters, clearing conflicts, and enabling lawyers to start to bill time. Now firms are taking a more strategic view. Striving to increase profitability and reduce risk, firms increasingly see NBI as an opportunity to transform law into a datadriven business and to foster a uniform culture of compliance. Technology has a critical role to play to manage process complexities and transform the data collected during intake into strategic insight to improve business performance. But finding the right technology to automate NBI requires more than just a comparison of product bells and whistles. As the firm will likely use the same NBI tool for years, a prudent investment requires foresight: demands for data-driven intelligence will grow, compliance obligations will evolve, the firm structure may evolve (e.g., through a merger) and new consumer technologies will continue to change the habits and preferences of lawyers and staff. Getting stuck with the wrong product could impact the firm's ability to stay competitive in a world increasingly defined by constant change; choosing the right one could enable the firm to thrive nimbly by promoting efficiency, compliance and strategy, as business needs and professional requirements evolve. Here Comes the Story of the Hurricane: BUSINESS AND LEGAL RISKS ADDRESSED BY NBI Client selection is the fundamental starting point for firm business, and identifying the right clients (while avoiding the wrong ones) is critical for a firm's success. Managing client data with an eye on longterm strategy, however, is a complex balancing act that must reconcile competing interests from multiple departments. Lawyers want to take on as much new business as fast as possible, marketing wants to collect information to fuel analysis and risk wants the time required to vet clients thoroughly. Therefore, an intake project challenges IT to institute technology that is fast, thorough and sophisticated enough to manage multiple risk management requirements. Each firm's NBI process is specific to its client base, practice group structure and overall strategy, but sound intake processes address a few core business and legal risks: •Client Intelligence: NBI is the central moment in the client and matter life cycle when the firm gathers data about clients. Firms increasingly seek analytics on client trends for marketing and business development. •Ethical Conflicts of Interest: All firms perform conflicts checks during intake. Firms should check for both adverse parties and adverse positions taken in prior cases. To increase business opportunities, firms increasingly solicit contractual conflicts waivers from clients or implement electronic information barriers to enable more lawyers to take on work. •Business Conflicts of Interest: Client outside counsel guidelines (OCGs) often stipulate that firms may not represent their (and their subsidiaries') business competitors, forcing firms to continuously verify evolving client corporate structures to vet potential malpractice. •Regulatory Requirements: Traditionally unregulated, now law firms are directly liable for compliance with regulations, such as the Health Insurance Portability and Accountability Act (HIPAA/HITECH) and Anti-Money Laundering (AML) rules. To meet compliance requirements, firms often flag matters containing regulated information during intake to initiate compliance workflows and governance procedures throughout the matter life cycle. •Creditworthiness and Due Diligence: Firms must perform due diligence on a client's credit history and future financial viability to guarantee revenue. For repeat clients and high-volume transactions, a brief credit check might suffice. For high-risk, "bet-