Litigation and investigations are expensive for corporations, but enlisting outside help or going to court is often a costly prerequisite.
Predicting and managing these expenses is where metrics comes into play. Metrics is the process of identifying, gathering, and reporting on measures in an ongoing way to track the performance of a specific task or area of business over a time period. Ultimately, metrics help with goal and risk assessment. Metrics are also a key part of providing insight about past performance to predict future outcomes based on business trends.
Tracking metrics help organizations improve their eDiscovery practice by helping with tasks like cost projection, case valuation, and strategy development. To determine what metrics would be valuable, an organization would need to analyze their current eDiscovery methods and create future goals. Evaluating metrics will help you identify which areas of your practice require attention and what solutions are performing well. It is important to track metrics continuously and holistically rather than isolating an analysis to one case at a time. By using a comprehensive approach, trends and cost can be quickly determined which reduces potential future roadblocks and can even prevent them in some instances.
Why Do Metrics Matter?
As clients are looking for ways to cut costs and make their operations more efficient, metrics are becoming more prevalent in the corporate sphere. There are many ways to customize metrics and break things down, allowing for precise data analysis and managed litigation costs. To accomplish these outcomes, the analysis will require data from several operational sources, like an e-billing system or matter management software.
Still need convincing that benefits exist to putting metrics in place? Here are some key ways metrics can create better business decisions:
Metrics reveal money saving opportunities which help better planning and budgeting.
Metrics can break down costs by case type, opposing counsel, vendor comparison, eDiscovery stage, and more. Past spending will forecast how needs to be budgeted for future matters and help uncover where too much spending is occurring. Knowing trends and cost variances early on is critical to managing spending and resource allocation. For example, cost metrics might show there is significant amounts of spending during the investigation phase of a procedure to attempt settlements for a certain type of case despite 95% of those cases are still going to go to trial. The trend in the example illustrates inefficient spending and signals the need to cut costs early on for these cases and allot resources to later phases of eDiscovery. Cost metrics can also help determine if new solutions or vendors should be explored as well as to plan ahead for when a certain matter could exceed the anticipated budged.
Metrics helps improve process and quality, which will affect day-to-day operations and shape future decisions.
A combination of metrics based on cost and eDiscovery performance can pinpoint which software is working best and which vendors can be cut. Maybe the metrics reveal that a data processing vendor yields inefficient results at an inflated cost. In turn, a new vendor could be brought in or in-house resources could be dedicated to the task and save money overall. Using historical metrics can determine what data should be eliminated. Less data means less storage costs and less document review spending. Additionally, metrics can provide insight into how much data a case will likely generate. If a case yields a number of documents above average, this could signal document duplication or a challenging case that will require more resources
Metrics can transform strategy.
Creating a consolidated view of metrics will require several pieces of detailed information, including case outcomes, legal spend, cost variations by matter segment, eDiscovery vendor performance, and outside counsel performance. All of this can be broken down further to get very specialized data. For example, a combination of metrics could determine how well a certain outside counsel performs in a jurisdiction before a specific judge. Using opposing counsel as a variable could make predictions even more precise. Using different metrics can help you strategize when selecting whom to hire as outside counsel on a case as well as provide insight as to whether to settle or litigate a case. Further, precision metrics generate recommendations for new vendors, collection strategy and custodian identification after receiving a legal hold, defensibility regarding discovery disputes in court, and evaluating outside counsel.
Taking the First Steps to Metrics Reporting
The type of metrics needed will depend on a specific practice, business needs, and goals. Sitting down and creating both long-term and short-term eDiscovery goals is the first step. Corporate counsel should make sure their outside counsel is aligned with their business goals and receive consistent updates in order to stay informed of any cost concerns and changes to process. When outside counsel makes changes, such as resource allocation or strategy decisions, they can use metrics to help their client understand why they are making these moves.
The ability to proactively predict outcomes and control legal spend will improve client relations for law firms and help in-house counsel teams make better business decisions. After choosing a specific format, corporate legal team leads should mandate that all vendors provide the same metrics across the board and attach it into your SAP system. This will provide counsel with the opportunity to view metrics from different vendors as a side-by-side comparison to ensure you are getting the most value. It may be beneficial to request that they break down the data by case type. Having this all in one place makes it easier to show trends and inconsistencies and will inevitably help with cost management efforts.
For more information, please contact:
Caroline Woodman, Senior Vice President and Managing Director, Asia, Epiq