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As we welcome 2005, our corporate landscape is littered with the remnants of companies (including law firms) that failed to see the future and seize opportunities. It’s time to heed their warnings. Clients are already demanding change from their law firms. Unless you want to join the other fossils, it’s time to change your ways. Here’s some advice for corporate counsel and their lawyers: 1. Commoditize routine legal transactions. If this weren’t possible, Nolo Press would not be in business. Companies are now using assembly tools to help staff create standard nondisclosure agreements, employment offer letters, leases, etc. Couple that with an electronic signature to make the transaction paperless, add a contract management system that properly stores documents for recordkeeping — and you’ve eliminated 90 percent of a legal professional’s time to create the document. Any routine document or transaction can be generated this way. If the situation happens to be a little more complex than you originally thought, you can always call in a lawyer to review and finalize the document. Law firms should be developing these technologies for their clients to use, rather than selling the same “fill in the blank template” over and over again and charging lawyer fees to generate the document. With technology, your firm can reduce the cost of producing documents, improve profit margins through licensing fee structures and redirect human capital more effectively. 2. Create consortia to share needed work. Acting alone, many companies’ legal departments have built reputations for driving change. What if companies combined their experience and creativity? Only imagination limits the new technologies that would evolve, delivering best practices better, faster, cheaper and deeper than ever before. In one example, five companies with global operations have joined together with a U.K.-based law firm to develop e-learning programs for managers, to provide training about employment laws in various countries. The content is provided by the law firm, which then gets the training module and application developed by the participating companies to market to its other clients — and the companies get the training. Win-win! It’s a fabulous partnership, where the companies save money for training they all need, and the law firm can market a 24/7 e-learning program via its Web site — earning money by licensing the training to other companies rather than sending in lawyers to do the training in person. 3. Move your legal work to low cost firms located in the Midwest, South or other regions away from high cost centers. Doesn’t sound like technology here, but it is. Extranets provide ways for companies to work with firms across the country (and the world ). Web-based worksites are always open, always on. Work flow tools — putting the right person in the right order at the right time — can dramatically improve productivity and reduce costs. For example, patent prosecution works well for this model — and if the client uses an online patent application tool for its employees, connecting to the firms that do the work, clients improve the patent prosecution for the company and the firms make more money through an increase in patent filings. 4. Bundle work for leverage. A solid request for proposal (RFP) process can achieve incredible results. If you combine your buying power by bundling all of your legal work into one bid, i.e., all real estate work in the U.S., or all legal work in all practice areas for a particular country, legal departments can improve the quality of work they get from outside counsel, and decrease costs. Coupled with a consortium of legal departments, a combined legal spend that represents a ready-made set of customers can motivate outside law firms to acquire the right technology to get the work done in a more efficient, price-conscious manner. With a volume of similar transactions over which to spread the work, firms can be more aggressive on pricing than if they bet the ranch on one transaction, while improving their profit margins. 5. Use technology, not lawyers, to perform legal work. Like e-learning and self-service document creation, technology can process routine, commodity legal work for which firms charge clients on a time basis. Why don’t law firms license their templates to client legal departments? Why don’t firms use document assembly tools to decrease the time it takes to create a separation agreement, or an employment agreement? Better yet, let the company’s legal department use that tool to create the agreement themselves. Licensing legal work is the future — it scales and it doesn’t involve the time of a lawyer to do the work. For example, McGuireWoods created ContractBuilder for its clients, to help them create their own contracts online, using the firm’s database of contract templates. 6. Create competition by always bidding your legal work. Competition improves product quality and reduces prices. General counsel issuing RFPs should require briefings on available law firm technology before awarding bids. Some firms and companies now use online “reverse auctions” as one way to leverage technology in the RFP process. Reed Smith recently created an online database for new privacy laws that affect medical providers. Members of the alliance that used an RFP to produce this site pay a fixed price per year to find quick answers to compliance questions. 7. Set milestones for law firms and give rewards for exceeding goals (or penalties for missing the mark). As firms truly partner with their clients, they must be prepared to share the risks and rewards. Just as companies give bonuses for high achievement, firms should also be rewarded for success — whether a big win in litigation or helping a company avoid a lawsuit. Jump aboard the electronic data discovery bandwagon. EDD tools improve discovery and speed the judicial process. Effective extranets help clients and firms share documents and information, improving decision making. Savvy firms will push for standards for EDD and extranets, so clients could all run off the same application. 8. Move 80 percent of your fees to a non-billable hour basis. Hourly rates hinder progress — there’s no incentive for firms to improve productivity if they make more money by billing more hours. In-house counsel must demand fixed prices for work; firms must learn that a fixed price is not based solely on time. Fixed prices encourage firms to use more technology to improve productivity while clients save in legal fees. 9. Mercilessly measure the success of the technology and process changes based on productivity and efficiency. None of this really matters if you can’t measure success. There are technology applications or process changes that don’t result in a win, or worse, can have the opposite results. So measuring is key — surveying client satisfaction, measuring results, costs, whatever measure captures the success you’re trying to achieve. Just like the industrial revolution, technology has revolutionized the way businesses work. But it’s not enough to have BlackBerrys and knowledge management systems. We all need to embrace these advances to change the way legal services are delivered. One partner I work with copies his assistant on all e-mails for the assistant to print in hard copy and put in the paper client file. I’m not sure there’s hope for this partner, but with clients demanding improved productivity and reduced costs, savvy lawyers will invest the time, energy and money into purchasing, training on, and using technology tools. You’ll be shocked and pleased at the return on investment. Attorney Laura Owen is director, worldwide legal services, at Cisco Systems Inc., based in San Jose, Calif.

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