"Knowledge Counsel Forum" Recap: One Man's View

Thanks to the good folks at Baker Robbins & Co., I was able to guest-blog the Knowledge Counsel Forum here in New York this past Thursday and Friday, October 28 and 29.  Rather than act as a virtual transcriber of the mountain of information presented, I will instead recap the  highlights, the insights, the unusual perspectives, and some of the wry observations which made these two days both intellectually rewarding and just plain enjoyable.  (I also understand that the full text of all the presentations will soon be on-line at Glasser LegalWorks.)

Michael Mills, Director of Professional Development and KM at Davis-Polk, chaired the conference and kicked off Thursday morning with his characteristic wisdom delivered in his equally self-effacing style:

• Knowledge is the firm.
• But this has always been the case, so why is the case for KM particularly urgent now?

After all, law firms have been doing KM for years: Our collective hundreds of years of common law precedent is one of the largest knowledge bases in the world.  But now:

1.  There is too much for any individual to know.

2. Increasingly, we have arrived at knowledge parity with clients, and they now expect all lawyers from any AmLaw 200 firm to be "excellent."

3.  And, firms have become too large to share knowledge organically, "by walking around."

IT is necessary but not sufficient; "The more valuable the knowledge, the less sophisticated the technology supporting it."  If IT will get you only partway to KM nirvana, and a collaborative culture is also essential, what can KM do about a dysfunctional culture?  "Forget it!" We are not going to change culture. Sharing is an expression of culture; not sharing is not a KM problem. "If you're not collaborating, you're not a firm."

Information hierarchies, categories, and taxonomies are powerful tools, to be sure, but ultimately they break down.  Consider:  How would you priority-rank the following:

• matters
• documents
• law
• practice
• people

The answer is that you cannot priority-rank these; each is important for a different purpose. Ted Nelson, an inventor of HTML, coined the word "intertwingularity." We cannot categorize, put things in hierarchies, etc.; everything is "intertwingled."

But if this is so, how can one demonstrate the economic value of KM:  How can one calculate an ROI? Answer:  "There are not enough regression analysis tools in existence to calculate ROI" so long as KM is a routine part of the way a firm works, and so long as the product actually improves.

Does KM have a role as a business development tool?  Absolutely!  Do something; do it again; then give it away. Substantive marketing = "giving away good stuff."  [I cannot endorse this notion strongly enough.  Since knowledge is what law firms sell, the most compelling way to demonstrate expertise is through offering blue-chip content.]

Finally, Michael addressed KM from the HR angle:  You get what you measure, you get what you pay for.  So how could a firm provide incentives to contribute to a KM database?  Simple:  Consider billable hour credit for KM engagement.  Mischievously, Michael pointed out that while billable hours obviously generate cash and seem stressful, by and large are not always intellectually demanding. By contrast, rigorous development of high-clas forms be immensely intellectually demanding, even if one can do it from home one day a week.  How would this billable-hour credit actually work?  Value it with a discount of (x)% off the billable hour.  Each firm has to determine what that discount factor is, but if KM work earns 80% of a billable hour, people will do it.

Session 2 :  The next session portrayed senior management of a hypothetical law firm in the persons of Bruce Kayle (a Milbank tax partner) and Bob Kafin (the senior operations-side attorney at Proskauer) together with Mike Mills and Alan Nathanson of Baker-Robbins acting as KM evangelists and the audience as knowledgeable observers.

The hypothetical firm looks like this:  A top tier NY firm (NY, DC, Boston, Chicago, LA, Menlo Park) plus London, Frankfurt, Hong Kong, Tokyo. Thought of as old school, profits down past two years, some top-tier partners leaving with groups of associates and paralegals.

Firm management realizes landscape is changing: Problems include duplication of lawyer expertise across offices with high fixed costs, firm consistently fails to serve all of a client's needs. "Silos" have become entrenched. Additionally:

• legal excellence is no longer a differentiator
• "all of the AmLaw 200 deliver top-notch legal service"
• clients want (and don't get): knowledge about and understanding of their business
• clients are prepared to pay for value they perceive as real business solutions.

How to address this?

• significantly increase competitive differentiation: this is a corporate-land insight. KM in corporations is not a diffuse competence; it's a tool to separate the firm from the competition by staking a claim to a territory and going through continuous improvement
• enable team-based solutions
• bring clients closer to the firm
• enable every lawyer to be in business development (not just a handful of rainmakers)

Should the firm undertake a competitive analysis?  Excellent idea, but very few firms do it. Anecdotes are not data; and there is, these days, a mountain of data available as to which clients are doing business with which firms on what types of matters. "Don't debate the facts."  But even if a firm does the competitive analysis, what use will it make of it?  Develop a strategic plan?  Don't count on it:  "Strategic planning in a law firm is looking at last month's numbers." (Michael Mills)

Realistically, it is difficult to manage the "firm," which is composed of multiple practice groups.  Some felt that you can only manage one practice group at a time and, accordingly, the "firm" is simply the residual of all the different practice group buckets adding up. So does that mean you should start with the highest-value, most profitable practices? In the abstract, sure.  But you immediately will run into real-world constraints: Partner age cohort is off, client base is on the wrong coast, etc. So be opportunistic in terms of what you actually can change: Practices where growth is actually feasible, lawyers can be supplied and clients cultivated.

What about leverage?  Here there was an interesting discussion:  In one camp were those who maintained that getting a task done in a more productive way is not to the firm's benefit; how could it be if it decreases billable hours?  In the other camp were those who believed that being more productive is very much to the firm's long-term benefit. Yes, there is a lot of high-end work where the client just wants it done and it doesn't matter if the bill is $1.6-million or $2.2-million. But not all work is like this, and for more commodity work it does matter if it costs $400K or $175K.

At the end, the fundamental fault line between the panelists broke not along what the firm's goal should be—to increase profits, of course!—but along the question of whether that was a meaningful or do-able goal in and of itself.  Bruce Kayle noted that if you call a meeting and urge people to focus on stronger associate development or spending more non-billable time with clients in order to get closer to them, everyone will leave more or less knowing what they've been asked to do.  But if you urge people to "increase profits," they have no clue.

The next "session" was devoted to break-out groups and the audience was divided into four hypothetical firms each facing a different strategic dilemma:

1. A 550-lawyer firm with 15 offices, but no clear identity in the marketplace and no "differentiating" practice expertise.
2. A 970-lawyer firm resulting from the merger of a Boston-based with an SF-based firm, with deeply incompatible systems and no clear leader (as epitomized by the firm's decision to adopt the name of the two firms in full, simply run together).
3. A 430-lawyer employment firm with 32 offices, none except HQ with > 16 attorneys.
4. A 180-lawyer mid-tier firm with offices in NY, LA, Chicago, and Vancouver, full-service "in name only," recently shedding partners, rudderless, with one strong practice area:  Entertainment (TV and music).

Techniques to address each of these hypotheticals were of course widely varied, but one common trope emerged:  How just-plain-hard it is to actually change a law firm.

Afternoon session: Chris Boyd, Director of KM and Professional Development at Wilson-Sonsini, and Julia Randell-Kahn, Director of KM at Freshfields (based in London), joined with Jeffrey Rovner, Director of Knowledge Management for the Americas at Clifford-Chance.  Each presented rather strikingly different views of how their firms approach KM.

At Wilson-Sonsini, "all-firm" email requests for expertise are channeled through one central server (the collection point), and are subsequently aggregates into an enormous firm-wide FAQ.   All case pleadings are also indexed by meta-data including fields such as the jurisdiction, the judge, the opposing firm, the type of matter and pleading, the Wilson-Sonsini lawyers on the case, etc., so, for example, it would be possible to review all interrogatories in XYZ jurisdiction in sexual harassment cases.  Stepping "out of the box" somewhat, a particular (un-named) Wilson-Sonsini partner had became so expert at drafting clauses in a finance practice specialty that the firm had begun to see his words coming back at them in filings from competitors.  Small World Dep't, indeed.

At Freshfields, Julia's challenge is far simpler and far more ambitious at once:  They are going to build a new global KM system to serve their 2700 lawyers in 26 countries:  After 15 years of KM experience over diverse systems, trying to integrate office "silo's."  Julia viewed the key function of KM to be, interestingly enough, risk management:

• quality control (no outdated doc's, etc.)
• client confidentiality/conflicts; and
• the ability/necessity for lawyers to actually be able to find prior art.

Julia also made the interesting observation that UK firms tend to approach KM from the human side, hiring practice support lawyers, for example, to draft model documents, while US firms approach KM through technology (search, indexing, etc.).  Although her description is surely correct, the jury is out on exactly why this state of affairs is so.

Jeff Rovner:  "The Good, the Bad, and the Ugly"  [Full disclosure:  I have known Jeff through email for quite awhile, and count myself a thorough-going admirer.  Inexplicably, the conference was the first time we had met in person.]

Jeff comes from a distinguished background:  Brobeck.  (OK, everyone, suppress the urge to laugh; in its time, and in its place, as I can personally attest, it was a special place.)

The first KM "portal" Jeff and his team developed at Brobeck, ca. 1997, was genuinely ugly, but surprisingly functional.  A home-brew, if you will.

The second KM portal (ca. 2000) was elegant, clean, sculptured, powered by a robust database lurking under its taut design.  But, gorgeous as it was, people sensed they were "talking to a database," not a human voice.  Erego Jeff's dictum:  "Nothing that comes out of a database is useful unless it can't be presented any other way."  In other words, when people are communicating with an algorithm, they know.  

So today at Clifford-Chance, Jeff & Co. have taken a third approach:   Essentially, every practice area has its own KM portal, customized to the of the specific practice.  Doesn't this require time-consuming hand coding?  Indeed it does, but the result is Truly Useful.  Thus the litigation portal has, prominently displayed, rules of all federal and major state courts, while the transactional practice has links to the SEC and Edgar.  Breathtakingly obvious, no?  But Jeff has been "thinking differently" for years.

Day Two

The day began with a high-level discussion of what we really want to achieve through search.  Ideally:

• Comprehensiveness:  enterprise search; want to be able to draw from disparate sources (DMS system, emails, Notes, etc.)
• Relevance:  want to return only pertinent and useful results
• Categorization:  would be nice to have results grouped in germane bunches ("from our briefs," "from the SEC," "from opposing briefs," etc.)
• Timeliness: presumably newer is better.
• Fast (as in, < 2 seconds tops)
• Scalable (duh)
• "Extensible"—a piece of common jargon not specifically elaborated upon or "unpacked" in this context, but my take on it was that the system should be able to robustly handle queries that were not anticipated when the system was built (either because the type of material being tracked didn't exist then [imagine a publishing database from 1990 that didn't have a way to distinguish between "print" and "online"] or because the designers simply didn't foresee the need to cross-reference specific tables (e.g., "Who in the firm has been before Judge X in an intellectual property case?")

Interesting point re user expectations driving technology:

The next presentation was by Brenton Miller, Director of Knowledge Management at Cleary; Brent told the story of Cleary's comprehensive review of its search strategy, starting two years ago.  (FYI, Brent recommends www.searchtools.com for anyone embarking on a similar project, or just wondering what's out there.)

About 18 months ago, Cleary sent a comprehensive RFP to a dozen or so vendors including IBM, Verity, iManage with an Autonomy add-on, Autonomy stand-alone, Inktomi (now Ultraseek), Go Albert, Dolphin, Convera, TripleHot, and Recommind.   The two finalists, including the ultimate winner, Recommind, were invited to do a trial index of approximately 150,000 documents at Cleary.  Brent strongly recommends anyone sending out an RFP insist on an on-site testbed at the end.  Again, Brent's comprehensive materials outlining the RFP process should be on-line at Glasser LegalWorks. 

I will conclude with some "highlight" anecdotes, and quotable quotes.

• "Successful implementation of KM solutions has absolutely nothing to do with technology"--EVP of sales, Hummingbird.
• Sometimes in urging partner adoption of KM, it's prudent to be "economical with the truth."  This can mean highly suggestive and open-ended remarks about the incredibly speedy rate of adoption of it elsewhere in the firm or at one's competitors, much like the (true) story about Steven Brill in the early days of The American Lawyer.  Brill, as anyone who knows him can readily imagine, was impatient at the publication's initial slow circulation growth, so he landed a meeting with the managing partner at Davis-Polk and told him (being "economical with the truth") that every single partner at Cravath had his own personal subscription—no archived copy relegated to the firm-wide library.  The result was predictable.
• At Freshfields, associates are being invited to do "secondements" for 3 months or so to do KM forms or "survival guides" (the bullet-point list you want to read 30 minutes before you're pulled into a meeting on a topic you know absolutely nothing about).  Most important is that associates so selected are chosen by senior partners precisely because of those associates' intimate knowledge of, and specialization in, the particular practice area in which they're expected to produce gold-plated reference documents.  And, although only early returns are in, essentially every associate who has been so invited has subsequently made partner.
• People who have been helped by a KM system tend to be helpful themselves, "with the exception of people in our New York office."
• "The motivators for getting people to adopt KM are fear, time, and greed."  One firm, which was planning to roll out flat panel monitors in the anyway, started awarding them as "bonuses" to anyone who made a key contribution to the KM effort.
• Another firm, which credits 50-80% of a billable hour to an attorney for the initial work they do developing a firm-wide form, credits them an additional two billable hours—and bills the client for same—every time the form is actually used.

And that, dear friends, was the Knowledge Counsel Forum--at least from the Rashomon perspective of one man.

Congratulations to all the excellent presenters, thanks again to Mike Mills and David Craig for making it possible for me to attend, and one last anecdote:  In both of the break-out sessions, I was chosen to be the "presenter" back to the group as a whole, and in both cases our group came in second.  No Metropolitan Museum "Athena" cufflinks for me this year:  At least not courtesy of the KC Forum.