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Leverage the small stuff

Posted by Jack Bostelman on Jan 05, 2014 | 0 Comments

Law firm leaders share ideas

Several law firm leaders are sharing ideas over drinks after a leaders' roundtable. They're discussing the final session, which covered value-adding information a firm can gather at the end of a matter, such as experience data and after-matter reviews.

Leverage canstockphoto8524543

A problem is surfaced

“I understand all this about the value of collecting information,” says Keith Mayfield, chairman of an AmLaw 100 firm, “but how do you know when the matter's completed? My partners say we ask our lawyers questions about a matter long after it's over. They can't remember the answers and have to spend extra time researching. All too often, they just don't respond.”

“We have the same problem,” laments another law firm leader.

“We have a pretty good system on the transactional side,” offers a third leader, “but it's probably more specific to our practice. For transactional work in our field, our clients insist that we defer billing until completion.”

“For financial reasons, we have a system to bug partners to get bills out when a deal closes,” the third leader continues. “It's based on a junior associate notifying our billing department that the deal has closed. There are no forms to fill out. The associate merely sends an e‑mail to the effect that such-and-such client/matter has closed. We've been doing this so long, it's become part of our culture.”

A lively discussion then ensues about how hard it is to accomplish the seemingly trivial task of learning on a timely basis when a matter has been completed.

The consensus solution

The upshot of the discussion is that some firms do indeed have procedures centrally to identify completion of a matter. The way they do this varies from firm to firm, and even from practice group to practice group within a single firm.

Why do we care?

Before summarizing the possible ways firms have approached identifying matter completion, below are some reasons why that is important to do.

  • Collect matter experience for marketing. Collecting basic information about a matter – description, amount involved, industry, parties, nature of transaction or dispute, etc. – is important for marketing. This is how comparable experience can be efficiently pulled together for pitch books, deal lists and league table submissions. If collection is delayed after matter completion, lawyers forget the required details and tend to ignore calls and e‑mails from the marketing department seeking this information.

  • Collect matter experience to find precedents. Lawyers in many practice groups may seek to collect additional data about their matters to aid in finding relevant precedents. This data can also be used to identify lawyers with relevant experience to whom questions can be asked or who could be staffed on a new matter. Delays in pushing for collection create inefficiencies because the junior lawyers responsible for inputting the information need to spend more time seeking answers through document review rather than from memory. It is also human nature that compliance drops off as time passes.

  • Fee benchmarking and budgeting. The same data collected for marketing and finding precedents can also be used to identify similar matters for purposes of fee benchmarking to prepare estimates and for budgeting as part of a legal project management initiative.

  • After-matter reviews. Conducting a lessons-learned meeting at the end of a matter is a best practice that is increasingly being followed by larger law firms. These meetings enable the firm to incorporate what did and didn't work into the way they do it next time. Clients are increasingly seeking involvement in these meetings. An after-matter review can be effectively conducted, though, only if it occurs promptly following completion of the matter, when the details remain fresh in everyone's mind.

  • Staffing lawyers on matters. Lawyers responsible for assigning associates to matters are keen to know which lawyers have available time. They will have an additional tool to identify available associates if they can learn in a timely way that a matter has been completed.

Consensus solution – the details

Team 20at 20closing canstockphoto1762060

The consensus that emerges from the leaders' informal discussion is that the firms that have the best solutions maintain a central database, typically within their financial systems, to store the fact of a matter's completion and its date.

Firms identify matters as completed using a variety of techniques. In fact, different practice groups often have different processes, even within the same firm. These techniques include the following:

  • Voluntary notification. This is the system described above by the law firm leader. The junior associate on each matter is responsible for sending a brief e‑mail to an administrative area to the effect that a named client-matter has been completed. Mostly used in transactional matters, the e‑mail is sent the same day as the closing and is incorporated into junior associate training as a necessary step in closing a deal.

  • Closing binders/bibles. In transactional matters, it is common to compile the key documents for future reference by the client and other parties. These are still sometimes prepared in book form, but increasingly as CDs or DVDs. They go by various names – bound volumes, closing binders, closing sets, bibles. In practice groups that have a central protocol for creating closing binders, the person in the firm who prepares them or liaises with the outside vendor is also responsible for notifying the person who maintains the completed matters database that the matter has been completed.

  • Closing documents sent to central records dept. In transactional matters, many firms require that its lawyers send a set of paper or electronic closing documents to a file for the matter in the firm's central records department. Where a records department administrator is responsible for cataloging or otherwise receiving and performing some handling of the closing documents, that administrator is well-situated to notify the administrator of the completed matters database.

  • Key litigation documents. In litigation matters, if there is a person responsible for maintaining an internal key documents repository (such as court filings and key discovery documents), that person should be close enough to the activity of the matter to learn on a timely basis when it has been completed. The firm can train that person also to notify the administrator of the completed matters database of the completion of the matter. This procedure will likely work best where the custodian of the key documents repository is not also a lawyer working on the matter but rather a paralegal or other member of the administrative staff.

  • Time entry drop-off. When lawyer time entries on a matter drop to a low level for an extended period (such as a couple weeks), that typically means either the matter has been completed or it has been abandoned or suspended. Customized software can identify the hours drop-off and notify an administrator, who can contact a lawyer on the matter to confirm whether the matter has been completed and then update the completed matters database.

  • Manual review of time entries. In combination with a system that tracks an hours drop-off in the time-entry system, an administrator can be trained to review time entries for telltale indicators that a matter has been completed, such as “attended closing” or “distributed executed settlement agreement.” In some cases the hours drop-off method may produce too many false positives (matters abandoned or suspended), with the effect that lawyers may tire of being bothered to confirm status and stop responding. In those cases, the additional manual effort of reviewing time-entries may be worthwhile. Communicating with the lawyers will still be required, though, to confirm the date of completion.

  • Legal project management. Firms with a legal project management initiative will likely have a person (lawyer or administrator) assigned to each matter to perform a project manager role, such as monitoring progress against key milestones, facilitating communications and tracking actual fees against budget. That person is well-situated to notify the central database when the matter is completed.

Build off existing processes

In general, the firms that are successful have identified ways to track matter completion that utilize an existing firm process. In some cases, firms have created a new process that not only produces its own benefit but also creates the opportunity to identify matter completion.

For example, where there is no established protocol for creating closing binders, creating templates and a central administrative group to assist in preparing closing binders will likely be viewed by junior lawyers and paralegals as improving the ease and efficiency of the process. Because the new protocol will likely attract much or even most of the closing binder work, it can also be an effective way to identify matter completion.

Take-aways

The seemingly small task of identifying completion of matters can actually be quite difficult. This is because it requires input from the lawyers, yet is considered by them to be so trivial that they assume others can address this need without their help.

Identifying matter completion is nevertheless important for many processes that benefit these lawyers. The answer is for firm leadership to push for a central matter completion database and piggyback to the extent possible on existing firm processes.

[Photo credits: © Can Stock Photo Inc. / Andres & coraMax]

About the Author

Jack Bostelman

Jack Bostelman is the president and principal consultant of KM/JD Consulting LLC. Before founding KM/JD Consulting, Jack practiced law in New York for 30 years as a partner of pre-eminent AmLaw 20 firm Sullivan & Cromwell.

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KM/JD Consulting LLC renders impartial practice management advice to law firms on improving efficiency, increasing profits and reducing risk, emphasizing knowledge strategy.

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Before founding KM/JD Consulting LLC, Jack practiced law in New York for 30 years as a partner of pre-eminent AmLaw 20 firm Sullivan & Cromwell.

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