ILTA White Papers

Deliver Tangible Value with KM in the New Law Firm just as well have been done by marketers, IT experts or information professionals. In leaner times, it is important to ensure that PSLs are focused on delivering outcomes that directly improve the firm's economic position. That is as true for firms considering investing in PSLs for the first time as it is for those who are evaluating an extant PSL population. Focused Work for PSLs: When focusing the workload for PSLs, there needs to be a clear alignment with the firm's goals. A firm that intends to excel in high-end partner-led strategic advice for the largest businesses in the world would be ill-served by a PSL population that worked hard on creating streamlined processes for basic transactional tasks. Likewise, a firm that aims to maximize profit by building a highly leveraged practice where a small number of partners supervise a large group of junior associates will need streamlined processes and would benefit less from PSLs producing high-quality marketing content. Strategic alignment is a good place to start, but it is also important to identify exactly what represents a successful investment in PSLs. When thinking about the return on investment in KM, many organizations overvalue the knowledge assets produced and undervalue the beneficial outcomes of using those assets. Law firms are no different, although this is changing. Rather than counting items in a knowledge system, a better understanding of the value of KM is gained from knowing how (or whether) those items are used to improve income generation or profitability for the firm. An outcome- focused evaluation of knowledge activities is harder than counting potentially useful items, but it is necessary to avoid the possibility that PSLs (and others) might simply be gathering or creating material that will never be used. When considering how to align and focus their work, it is important for PSLs to have the best understanding of the firm's strategy as well as that of their practice group. In some firms this has been problematic — PSLs have often been positioned as a back-room resource, with the result that they can be remote from the work of their fee-earning colleagues. This remoteness has two consequences. The more obvious one is that, without an understanding of the context in which lawyers use their knowledge for the benefit of their clients, PSLs are more likely to produce material that adds little value. The other is that a significant aspect of good PSL work comes from being able to make connections between people. In order to make the biggest difference, PSLs therefore need to be at the heart of a firm's practice — understanding exactly what challenges the firm and its lawyers face, and suggesting or delivering solutions to answer those challenges. In practice, the challenges faced by a law firm should be aligned with those faced by its clients. Just as a law firm's strategy is bound together by its approach to client service, PSLs should be considering the work they do and the benefits for clients. These benefits might be felt directly, where PSLs do knowledge work (training or precedent drafting for example) for clients at cost or as a value-added service. It is more likely to be indirect, such as when the work that PSLs do for their fee-earning colleagues improves the quality of the firm's advice to clients. There will continue to be a place for PSLs in large law firms for some time to come. However, as those firms become necessarily leaner and more strategically focused, so will their PSLs. They will need to be managed to have clearly defined outcomes, embedded at the heart of their practice group, so that they can adapt easily to changed situations. And it is crucial that they focus on improving client work, whether directly or indirectly. The Processes Outsourcing and KM: The outsourcing of legal services has a unique position in the current economic situation. On one hand, the growth of outsourced legal providers has brought new competitive pressure on many law firms. On the other, many firms (sometimes the same ones) are turning to outsourcers as allies to cope with client pressure regarding costs. In addition to client-facing legal services, outsourcing is becoming more significant for law firms trying to reduce their own costs. ILTA White Paper 61

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