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How must lawyers adapt to technology? The profession no longer sees technology merely as law office automation but as a potent competitive edge. Below, two perspectives on how firms must rethink their strategies in order to keep pace with technological change. In the first article, Elizabeth Broderick and Gerard Neiditsch of Sydney’s Blake Dawson Waldron discuss how their firm has ventured into e-commerce and dot-com land. In the second, John Hokkanen, one of the leading legal technologists in the U.S., explores the changing needs of law firms and their technology specialists. AUSTRALIA’S GOLD STANDARD By Elizabeth Broderick and Gerard Neiditsch Does anyone remember Meryl Streep as Lindy Chamberlain in “Fallen Angels,” a Hollywood classic based on the famous Australian dingo baby-snatching case? At Blake Dawson Waldron, we do. In 1987 we were retained by the Australian government to investigate the convictions of Chamberlain and her husband, a minister, on manslaughter charges. The couple was eventually pardoned. For us, the case was the first time we used technology to support a major piece of litigation. We established what are today simple structured databases for documents and a full-text transcript search system. It was the start of our firm’s long, slow embrace of technology, and more recently, the Internet. Today, we take pride in the ways we use technology in our practice and the technology products and services we offer to clients. By 1993 we had started to use our technology for more than basic knowledge management and litigation support. That summer we were invited by Broken Hill Proprietary Company Limited, a major global minerals and industrial company, to compete in a beauty contest. BHP found it difficult to keep abreast of state and federal environmental legislation (over 150 separate acts). The company wanted a system to advise their environmental and site managers on laws and policies. We won the contest by proposing the creation of SOAL (Summaries of Australian and New Zealand Legislation) Environmental, our first computerized legal product. It provided managers with plain English summaries of their responsibilities. A site manager who wished to move asbestos could log on to the system and learn the proper notifications and transportation steps he must take. Shortly thereafter Imperial Chemical Industries PLC retained us to develop a companion product, SOAL Occupational Health & Safety. The clients paid for about half of the development costs of these products. We assumed the rest of the cost. The arrangement allowed Blake Dawson to market these products to other companies, clients and nonclients alike. Now lawyers and IT staff are not renowned for their marketing skills. We figured that we had two alternatives. One was arranging a strategic alliance with a marketing and distribution company. The other was building a sales capability within the group. We tried both options. We established a joint venture with CCH Incorporated, a large legal publisher, for the marketing and distribution of our pension fund compliance software. We also established a dedicated cell of lawyers and IT and sales people to develop and market our growing suite of computerized legal products. We now have eight lawyers, eight project managers, two internal and three external developers, and a full-time sales manager. Other staff are retained on a contract basis. I can’t stress enough how important the role of our people has been in our success. We have tried to nurture people by creating a flexible and supportive working environment. We encourage part-time work and telecommuting. We try to make sure parents can have a home life. But it’s not always easy. We hired our first sales manager after a rigorous selection process. Judging by the amount of time he spent on the phone, he appeared to be busy. Little did we know that half of his time was being spent on pay-by-the-minute calls to a psychic healer. At the beginning of 1998 we reached a crossroads: Would we embrace the Internet or not? We decided to go for it. We retooled all our products for an Internet environment. At about the same time, we created the first of our expert systems for clients based on Jnana Inc.’s Internet-based technology. Expert systems are complex programs that, in our case, assist clients with legal problems. A major packaging company, decided that it wanted all advertising copy to be vetted by our expert system, which we call a Virtual Lawyer. This was scary stuff. It meant that our e-commerce infrastructure had to be robust and available 24 hours a day, seven days a week. We had to examine alternative methods of pricing based on transactions rather than subscriptions. We are still some way off being able to bill on a click rate. But we have learned that clients can and will take advice from an expert system. We are now rolling out a series of redeveloped and new Internet-based legal services. They are targeted at the following areas: environmental, occupational health and safety, pension funds, insurance, antitrust, workplace harassment, advertising, and forensic e-mail discovery. The new products and services will help our clients with compliance, training, and investigation in these areas. We would not have been able to accomplish much without goodwill, trust, and respect between our IT and legal staffs. One key for the future will be retaining IT staff when Internet start-ups are competing for them. In this environment, partnership structures are more of a hindrance than a help. Most partnerships are not sufficiently flexible to accommodate and reward lawyers in nontraditional areas, let alone key nonlegal experts. This will become an issue of survival for many partnerships. Blake Dawson’s partnership structure is flexible enough to reward lawyers, even those legal technology lawyers who are no longer practicing law. However, it is just as important to retain and reward critical nonlegal skills. I believe many firms will soon start to spin out their e-commerce functions into stand-alone companies in order to reward these valuable professionals. Think of it as a dot-corp/dot-com structure, where the dot-corp is the traditional law firm and the dot-com is the e-commerce and services unit. We have seeded our first eVenture. This eVenture is based around our eDiscover e-mail mining technology. The technology can reduce the time to discover e-mail by up to 80 percent and the overall cost of discovery. We envision that both the senior lawyer who had the idea for the technology and several developers will be offered equity in the eVenture. At this stage the lawyer and one developer have moved out of the firm to get the business up and running. In this way we have also offered these key staff an alternative career path. There are many challenges in establishing the boundaries between the dot-com and dot-corp operations. They include: � Ensuring that the dot-corp (the law firm) continues to receive technical services and support. � Structuring the two operations in a way that benefits both parties. Should the dot-com be completely spun off, or should there be common shareholders and shared resources? � Branding of the dot-com operation. Should it have a separate or co-branded entity? � Creating an entrepreneurial culture within the dot-com. Major law firms are not set up to make quick decisions or take risks. � Properly funding the dot-com. One option is to acquire venture capital and investments from key staff and dot-corp partners with an appetite for risk. These are not challenges most lawyers or firms thought they would be facing just a few years ago. We are no longer traveling along a road. We are taxiing on a runway and about to take off into a new world. Elizabeth Broderick is the partner in charge of the legal technology group at Sydney’s Blake Dawson Waldron. Gerard Neiditsch is the firm’s director of information technology. THERE GOES GADGET GUY By John Hokkanen Gadget Guy: lawyer, predominantly male, who gets excited about technology for its own sake. Often has extraordinary memory for obscure hardware and software facts. Possesses an overpowering need to demonstrate obscure technical knowledge and to use buzzwords. Offers unsolicited opinions on cellular modems and handheld devices. Turn-ons: Three-finger keyboard short-cuts, two-way pagers, and obscure voice- mail system commands. Turn-offs: Evaluating the return of a technology investment, focusing on long-term business strategies that leverage technology (as opposed to technology quick fixes). Synonyms: Geek-wannabe. The past 20 years have given rise to Gadget Guys. In the early days, Gadget Guys were critically important people because of law offices’ focus on technology infrastructure. However, as infrastructure has matured and become standardized, the role that Gadget Guys play in an organization should be reexamined. Gadget Guys arose out of a need for a lawyer to understand and assess investments in technology infrastructure. They knew which phone system, document management, or litigation support system best fit the organization’s needs. This person also served lawyers as the go-to guy about technology. He (and they were usually male) could usually speak both English and techno-jargon. Best of all, Gadget Guys enjoyed talking to the IT department — a task most lawyers found to be tediously painful. But law offices now face new challenges. Firms have made large investments in both hardware and software. Initially, these investments were offset by labor savings. These “investments” have not let up; in fact, they have become fixed costs, not onetime occurrences. If there is any return at all, it is not easy to measure. Within the last few years, firms have begun to perceive correctly that the problem was the focus of investment and the subsequent follow-through. It’s not enough just to invest in a network if you aren’t making use of it with enhancements like groupware. Likewise, word processors are fine for speeding document production. But they become much more effective as part of a work product retrieval system in which lawyers reuse parts of documents. As firms have discovered, groupware and practice systems are much less about technology than they are about people and processes. Groupware requires education, buy-in, and championing from many different constituencies. Practice systems require understanding how lawyers work and think. These systems require much greater involvement by lawyers at every stage. Ultimately, they are built with a little bit of technology and lots of sweat equity. It is no longer enough for Gadget Guys to evaluate, purchase, and install technology. They must now also understand lawyers and their work and create technological processes that support lawyers in their work. Gadget Guys need to reason deductively, but that is not enough. They also must exercise creativity, ingenuity, and judgment. Technology assignments no longer are measured in weeks or months, but years. This work is not particularly sexy, either. You cannot brag about the new widget in your pocket, the fast box on your desk, or the fat connection to the Internet. Your reward comes from working with groups of lawyers, paraprofessionals, and staff. Though results are slow, they are deep and long-lasting. This new work is somewhat alien to Gadget Guys. It requires candor: The best system might be extremely low-tech. For better or worse, many Gadget Guys are now the decision makers within law offices. And because they may not “get it,” they may be putting off the important work that needs to be done. Law firms need help building processes that help lawyers practice law. They don’t need new technological Taj Mahals. It’s time for the propeller-heads of the profession to give up the steering wheel of the bus. Who is driving your organization? John Hokkanen is an Internet strategies consultant for Houston’s Baker Botts. Until recently Hokkanen ([email protected]) worked full-time as the vice president of technology at Good2CU.com, an Internet portal in Austin. Related Chart: The Am Law Tech Survey Related Chart: The Big Picture

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