What is Matter Management? And Why it Matters to Legal Ops2018-10-20T16:48:07+00:00

What is Matter Management? And Why it Matters to Legal Ops

Lauren Jackson

What made matter management so important, so broadly, so quickly? Faced with the challenge of managing thousands of new legal matters every year, from both internal and external sources, corporate legal teams recognized that managing this process manually isn’t an option anymore.

Not only do they need automation and control throughout a matter’s lifecycle, legal teams need a centralized source to manage the routine processes of opening matters, managing workflow and running reports.

What exactly is matter management? Matter management involves managing all activities surrounding corporate legal practice. This is distinct from case management, which refers to the activities specific to a law firm.

To be truly effective, a matter management solution should support all corporate legal matter types, which can include a variety of tasks:

  • Disputes and Litigation
  • Contracts and Transactions
  • Intellectual Property
  • Claims
  • Legal Research
  • Governance and Compliance

Why are legal teams across the globe flocking towards a centralized, automated, streamlined approach? We’ll explore the benefits down below, but let’s first take a look at the challenges driving Legal Ops away from “traditional” processes and approaches and towards matter management software platforms.

What challenges are driving corporate legal towards matter management?

A study conducted by Hobson & Company on the ROI provided by matter management software uncovered two key business challenges this type of solution addresses. As revealed through interviews with Assistant General Counsel, Directors of IT, Directors of Legal Ops and administration at several major US corporations, those two challenges are:

  1. A lack of standardized processes
  2. Inefficient systems for managing outside counsel

Now let’s take a closer look at each.

Challenge #1: Lack of standardized processes

A lack of standardized processes can create negative ripple effects throughout the entire matter lifecycle. Not having the proper channels in place can impact everything from opening new matters to managing existing ones to reporting on matters at any phase in their lifecycle.

“While it’s very important to establish where you want to be and why from a technology standpoint, it’s also important that you make changes to the management side of the process. That way you can set the standards for what you’re doing and where you’re moving as a company.”

That’s according to Brian McGovern, former Legal Chief Data Officer at AIG, where he was in charge of the world’s largest successful global implementation of enterprise legal management software. McGovern, now an Executive Director at Mitratech, is a big proponent of improving processes, not just upgrading technology, and establishing a clear roadmap to drive your company’s Legal Ops success.

Without the proper system and processes in place, companies cannot hope to have the true visibility into their legal operations, legal spend and matters that they need to.

The consequences? Missed deadlines, missing documentation, inefficient processes and lack of predictability and control over legal spend, just to name a few.

Opening new matters and managing existing ones

When it comes to opening new matters, managing existing matters and reporting on matter progress, not having a standardized process in place significantly reduces staff efficiency. Without an automated system, it’s difficult for companies to establish and enforce standardization to streamline this effort.

Even worse is when companies have multiple databases in use that don’t speak to or integrate with each other. The time it takes to manually move data back and forth between systems – and the resulting data entry errors that inevitably occur – further reduces staff efficiency and effectiveness.

How does a good matter management software solution solve these issues?

  • It provides powerful workflow and integration capabilities that automates and integrates with multiple systems to connect people and processes across a business, with customization to meet the company’s unique needs.
  • It provides a single sign-on, single-source-of-truth repository where legal employees can find everything they need to do their job, creating consistency and alignment for everyone. For companies that face anywhere from a few hundred to tens of thousands of new matters each year, improving staff productivity through standardized and automated processes leads to big gains in ROI.

Reporting on matters

How did reporting work, back before companies began to implement to matter management systems? Here’s what one Director of Operations at a Fortune 500 health products corporation had to say about the reporting “process” for their own homegrown approach in a study on the ROI of matter management software:

“Senior level managers were spending significant time emailing and calling around looking for and asking about documents. The whole process was very inefficient.”

The primary challenges they faced, in the absence of a unified, centralized system providing more integration and oversight than silo-segregated emails, spreadsheets, and manual workflows? There were two main ones:

  1. lack of access to matter data
  2. lack of insight into legal spend

Without a single system in place, staff had to sort through numerous spreadsheets and emails locate the data they needed and manually create reports.

In both scenarios, business users rely on technical staff (their own or a vendor’s) to run reports or to create report templates, which increases reporting time and limits reporting ability. As a result, companies are unable to fulfill or optimize their reporting needs.

This inability to easily access complete data makes the task of managing matter portfolios cumbersome for staff attorneys. With a manual or last-generation software system, staff attorneys spend a great deal of time searching for data, reconciling data gaps and inconsistencies, and compiling what they’re able to assemble for analysis and reports.

For each company interviewed in the ROI study, the results were the same. Across tens, hundreds, and, in some cases, thousands of staff attorneys, inefficient reporting processes were a major drain on the legal department’s productivity.

Challenge #2: Inefficient systems for managing outside counsel

As far back as 2012, corporate legal leaders were making waves about outside counsel and the value they got for their legal spend, according to the Harvard Business Review:

It’s not just the size of any particular bill that irks executives; it’s that they feel they have little influence over what they spend and what they get for it—and that the accountability seems to be much less than what most other business services provide.

When outside counsel is inefficiently managed through manual means, it can lead to unfortunate (and expensive) results for a company. For example, situations that require outside counsel to provide staff attorneys with regular updates on matters via phone and email not only decrease the productivity of in-house legal teams, but also increase the number of billable hours being levied by outside firms.

Given the numbers of matters and different firms legal teams often work with, this process is highly inefficient. Whenever law firms have to spend more time communicating with their corporate clients, the timekeeper’s billings inevitably increase while the speed to process a matter decreases.

“Making it easier for law firms to communicate with their clients would be a particular benefit for smaller firms that have fewer resources.”

Director of Legal and Compliance Technology
Fortune 100 Pharmaceutical Corp

Taking advantage of any existing company relationships with law firms can help the company negotiate lower rates and AFA’s. However, when it’s difficult to share information across the legal department these opportunities are missed.

It’s also challenging to assign new work and manage the workload of law firms in a manual or decentralized system.

Other questions a decentralized, manual approach leaves unanswered?

  • How can in-house legal staff select the right firm for the job without access to the necessary information?
  • How can companies weed out poorer-performing law firms without access to real-time data on their matter outcomes?
  • On the flip side, how can companies recognize and better utilize the top-performing firms?
  • Without a way to easily track the amount of work performed by each law firm, how can companies understand when they can leverage their relationship to negotiate a better rate?

These are just a few of the questions a centralized matter management software solution answers.

How matter management solves these challenges

Why is matter management, leveraging a solid Cloud-based software solution, the foundational element of any effective legal management program?

First and foremost, it drives immediate value (and ROI) for an organization. According to a study conducted by Hobson & Company, companies with a good matter management solution saw ROI multiples of 7-10x. Some of the ROI gained is simply through the more efficient and effective management of outside counsel having a single solution provides.

Additionally, implementing a matter management solution provides three key benefits:

  • Reducing time and effort to open new matters. By automating matter opening, using templates and creating standardized processes, this software reduces the time it takes to open a new matter from 60 minutes to 15 minutes.
  • Establishing a central location for all matters. With a single source of truth in place, legal can ensure a complete and accurate database, which can later house comprehensive analytics to identify trends and proactively mitigate risk.
  • Managing costs – proactively. By centralizing matter data and increasing their visibility into matters, legal teams can better manage matter workloads and costs, saving 1.5% per year in external legal spend.

The insights such a solution provides for cost control are a leading attraction for legal and IT decision makers, who ranked matter management/budgeting and billing among the top uses for legal analytics.

Similarly, 31% of respondents to a 2018 Coalition of Technology Resources for Lawyers (CTRL) survey were using a matter management system, with 20% of respondents planning to adopt one within 12 months. The top matter management use case for these systems? 60% would use it for “budgeting resources.”

Other benefits?

But the benefits corporations stand to gain through a matter management solution don’t stop with spend management. Here are just a few other examples of how a best-of-breed matter management solution can reward a corporate legal department:

  • Improvement in end-user productivity due to integration with other systems
  • Reduced time spent generating, storing and referencing legal documents
  • Reduced time spent generating reports for business users
  • Digitization and automatic archiving of documents and process assets
  • Automated notifications that reduce the number of manual emails
  • Faster record search process
  • Streamlined, more efficient allocation of work across resources to maximize productivity
  • Enhanced collaboration and outcomes across the legal team
  • Enhanced risk mitigation, built into the best offerings
  • Improved security and compliance practices for data and document handling
“Every once in a while, a new technology, an old problem, and a big idea turn into an innovation.”

Dean Kamen

The future for matter management?

Ultimately, corporate legal teams have a lot to gain by implementing the right matter management solution. In this day and age, the costs of trying to maintain a manual system are too high – both in monetary costs and the potential risks of noncompliance that are rife in unautomated approaches.

The future of matter management lies squarely with technology solutions, and the more easily adopted and cost-effective they are, the better. In a period of mounting pressures and growing responsibility for corporate legal departments, picking the right software will be vital; the right solution can prove to be the solid backbone of efficient, innovative legal operations that provide their enterprises with unprecedented agility and value.

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