The Rise of Business Intelligence in the Legal Department

I work with large corporate legal departments involved in large-scale and often repetitive litigation and regulatory investigations, and recently found myself wondering, “Why are corporate counsel using analytics with greater ease and confidence for individual litigation reviews, but not to manage e-discovery spend, track and manage data across cases to make more informed decisions, and improve processes and outcomes?”

Beyond using analytics and reporting tools for one-off cases, how many legal teams, including corporate legal operations officers, really track and manage data across all matters in real-time, at the push of a button? Why’s this so important, what’s holding them back, and how are forward-thinking legal departments addressing these challenges?

The Expanding Role of the General Counsel and Legal Department

Legal department business models are changing. They’re operating more like business units within the corporation and are expected to be high performing and successful. As mentioned above, many now have legal operations officers tasked with driving peak performance—that is, increasing efficiencies and adding value to the company while driving down costs. General counsel, specifically, increasingly play a strategic role in advising executive team and board decisions, proactively participating (if not overseeing) information governance and compliance initiatives, along with managing legal risk. In addition to these areas of responsibility, general counsel are evolving their roles to encompass other areas, such as corporate governance, enterprise risk and even IT and cybersecurity risk. Legal departments have a much wider purview than ever before, and the expectation is that the legal function can bring additional insights to strategic decisions.

As in-house legal teams assume greater responsibility, legal operations professionals are seeking faster ways to improve transparency into their data. This insight is not only to support core legal department functions (such as determining the optimal mix of in-house and outsourced resources and e-discovery spend planning), but also to provide higher levels of visibility that can inform decisions at the executive level.

What’s Hindering Strategic Decision-Making?

There’s a lot of hype around “legal business intelligence,” “analytics” and a host of other terms that are used interchangeably to describe the broad category of tools that can help legal teams make better and more strategic decisions. Just do a Google search and see the millions of hits that come up.

Without unpacking these definitions, in reality legal departments are generally slower to adopt tools that aggregate business data for analysis and insight than other business units. But the need is real. In fact, to appreciate how important business intelligence and analytics really is, we recently wrote about a survey of chief legal officers that suggests there is still a wide gap between the reporting they need for strategic decision-making and the reporting they actually get.

The problem is, most legal departments still manage their information (particularly case data) in siloes, with disparate systems, e-discovery vendors and law firms holding financial data, case information, e-discovery project management activity, etc. This makes it all very difficult to get meaningful data within the organization or from across a myriad of third parties to inform decisions. At best, it’s still a highly manual, time-consuming and expensive use of paralegal or analyst time.  At worst, some legal departments may be lagging in their ability to manage their performance and help improve company outcomes.

Turning Data into Actionable Insight

There are a number of products out there that, at the most basic level, can improve the way that legal departments operate. The most effective tools, however, focus on the most important questions that affect the business. Based on defined objectives, these tools provide insight across all matters so legal operations professionals can easily track the progress of cases, counsel and legal bills in real time, evaluate pricing models, technology options and staffing decisions, reuse data for efficiencies, and use data to inform any number of strategic decisions.

We wrote about the advantages of aggregating data into a single data warehouse in a previous post; the best business analytics tools do this plus include the following core functions:

  • E-discovery management
  • Cross-matter budgeting
  • Key performance indicators
  • Law firm and vendor billing
  • Data collection and storage

The Bottom Line

General counsel and legal operations officers understand that access to meaningful metrics and business intelligence is a key component to managing spend and risk. Getting there shouldn’t be so difficult. When properly designed and supported by experienced professionals, legal departments can enhance efficiencies, better align cross-functionally and help propel the organization forward with data-driven insights.

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About Jennifer Davies

Davies comes to Catalyst with more than five years of experience in product management and related roles. Over the course of her career, she has become proficient in assessing market needs, working closely with core clients, bringing products from conception to release, and ensuring customer service and satisfaction. Prior to joining Catalyst, Davies worked in technology and product management roles in the healthcare, data solutions, B2B, and hospitality industries. Most recently, she was product manager at DaVita Kidney Care in Denver, where she headed the physician experience product team. She was previously product manager at SpotX, a video inventory platform; Return Path, an email solutions provider; and AgentSolid, a mobile app development company.

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