ILTA LPM Roadshow KK Prosperoware 2015

(c) Prosperoware & Kraft Kennedy 2015 11/10/2015

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GPS for LPM:Know Where You Are and Where You’re Going Before You Get Behind the Wheel

Keith Lipman, Prosperoware Natalie Alesi, Kraft KennedyILTA Roadshow

Agenda

Introductions Fundamental

Disruption in the Legal IndustryThe Roadmap

to LPM

Prosperoware, Kraft Kennedy: What we do

State of the legal market

Is your Firm ready?

Umbria Demonstration

Quick Look


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Company Introductions

Who is Prosperoware?We build technology that connects the practice and business of law.• Founded 2009• Legal process experts• Deep understanding of Content

Management• Offices: Philadelphia, Chicago and

London


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40% are Prosperowarecustomers

31% are Prosperoware customers

Total customers 200+

Four platforms,four focus areas

WorkSite add-on products improve administration and empower users

Secure email management and remote access

WorkSite integration with your SharePoint intranet and extranet

Transform your firm into a client-focused business through Legal Process Management


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Profile of Kraft Kennedy

• Founded in 1988, 27 Years of Experience

• Long Standing Commitment to Legal

• ILTA Platinum Sponsor/ALA Sponsor

• Experienced, Highly Trained & Certified Consultants7

Practice Groups at Kraft Kennedy

Legal/Project ManagementManagement Consulting

Information Security & Governance

Enterprise Client Systems Infrastructure Enterprise Systems

Support Practice Group8


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Client Base

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Legal Project Management vs

Legal Process Management


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Defining a Project• What is a Project? PMBOK

– It's a temporary endeavor undertaken to create a unique product, service or result.– A project is temporary in that it has a defined beginning and end in time, and therefore defined scope and resources.– And a project is unique in that it is not a routine operation, but a specific set of operations designed to accomplish a singular goal.– Disciplined approach to planning legal matters in an efficient, predictable and consistent manner. According to the ACC…– The evolution of clients expectations of in house counsel is driving the need for project management.

• According to the ACC…– The evolution of clients expectations of in house counsel is driving the need for project management.

Defining Legal Project Management(1) a proactive, disciplined approach to managing legal work that involves defining, planning, budgeting, executing and evaluating a legal matter(2) the application of specific knowledge, skills, tools and techniques to achieve project objectives (3) the use of effective communication to set and meet objectives and expectationsThe Power of Legal Project Management, A Practical Guide, published by the American Bar Association


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Defining Legal Process Management• Legal process management is the ability to systematically monitor and control the quality, efficiency, and predictability of workflows to improve repeatability of legal work. Deliverables

• Checklists• Process mapping• Work breakdown structures• Strategic workflows• Templates

The need for LPM:How did we get here?


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Drop in demand Fee pressures Balance of power

Client Pressure

Legal Market Revenues vs. Inflation (1999–2013)

Source: U.S. Census Bureau Service Annual Survey and U.S. Bureau of Labor Statistics

What happened in the late 2000’s?


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Why is the legal industry in a state of disruption?

General Counsel CFO CEOBoard of Directors

Ability to withstand

market swings


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The Client & Partner Power Shift

“Experience, experience, experience...”

“We have a lot of Law firms why should we hire your firm?”


“I don’t know, every matter is really very different.”

“I have a new matter for you to handle, however, I need to know how much it will cost me?


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“Hmm…OK ”

“I have been given a 10% budget cut, in order to achieve this I need your firm to cut rates by 10%.”

…meanwhile inside the Law Firm

“Hmm… ”

“So Bob, you want to cut our rates by 10% for customer XYZ, how profitable will this matter be?”


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• 197 Corp Legal Departments from Fortune 1000• 114 from AM Law 200 and NLJ 250 firms• Nearly 50% firms polled have a dedicated pricing officer• 82% of firms over 1000 attorneys have this function• Two-thirds of firms with pricing officer say profitability

improved• 60% firms polled say they provide training in LPM

ALM Legal Intelligence Study 2015

Source: The American Lawyer Sept 2015

• According to Clients?– Clients say they initiated 70%– 24% firms initiated mutually by both– And only 7% initiated by firms

• What do Firms say?– 25% initiated by firm– 49% mutually initiated– Only 26% initiated by Client

Differing Perspectives – Who initiates AFAs ?

Source: The American Lawyer Sept 2015


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Which matters have pricing pressure?

The amount of fee pressure is tied to the risk:Clients are willing to pay more for “bet the business” representationOther factors:

• Company size• Area of law

Bet the Company

Mid-level Risk

Nuisance


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Perception is in the eye of the client

Source: Richard Susskind

Bespoke Standardized Systemized Packaged Commoditized

There is a wide range of sophistication• Rise of alternative fees

– Discounts, collars, fixed fees• Other client trends:

– RFPs– Procurement involvement– Reverse auctions

• Processes with teeth• Client use of data analytics

How are clients applying pressure?


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What do clients really want?

SAVE MONEY

• Budgeting• Predictability• Certainty• Efficiency

1OTHER CONCERNS

BudgetingPredictabilityCertaintyEfficiency Value

TAILOR THE OUTCOMES

ANDINVESTMENTS

TO THE BUSINESS

GOALS

Insidethe law firms


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Partners must shift how they work

From perfect service

• Price irrelevant

To client focus

• Price is key

From: Any hour is a good hourTo: A profitable hour is a good hour

From: Partner compensation from origination and billed hours

To: SalesManage your mattersQuality of work

Shifts in measurement


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• Value-based billing options for pricing of legal services to better allocate risks and align incentives in ways that best suit the client’s goals for a particular case or portfolio of work.

Association of Corporate Counsel

The Roadmap for LPM


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Partners are data starved

The LPM Maturity ModelSteps to transform your firm into a client-focused business

Step 1Budget and monitor at the matter level

Step 2Matter type and phase development

Step 3Monitorand identify obviousinefficiencies

Step 4Identifycommon tasks across matter types

Step 5Manage your matters withchecklists

Step 0Access to information


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The LPM Maturity ModelFive steps to transform your firm into a client-focused business

The Roadmap for LPM Readiness


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Is your firm currently planning or implementing legal project management?

39.7%

29.3%

31%

Almost 70% of firms surveyed are currently planning or implementing

legal project management

Legal Project Management

Legal Process 3

Legal Process 2

Legal Process 1

How It Works


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Legal Process Management ReadinessFoundation

RFPsRFPs

Billing PracticesBilling Practices

Historical InformationHistorical Information

CommunicationsCommunications

Client EngagementsClient Engagements

Plan

Process Mapping WorkflowsProcess Mapping Workflows

Cost for TasksCost for Tasks

Map to BillingMap to Billing

Design Future Process StateDesign Future Process StateWaste/Risk IdentificationWaste/Risk Identification


Execution

Conducting legal workConducting legal work

Timing/ResourcesTiming/Resources

Tracking WorkTracking Work


AnalysisMonitor/Control

Billing/BudgetBilling/Budget

ScopeScope

Process/Waste MonitoringProcess/Waste Monitoring


Improve/Lessons Learned

Consistent review of matter workflowsConsistent review of matter workflowsConsistent review of processesConsistent review of processes

Training/RetrainingTraining/Retraining


Creating a Statement of Work• Preventing write-offs• Assumptions, Risks defined up front• Enhanced client communications• Identifies areas of potential cost increases• Defines timeline and establishes budget• Sets tone and strengthens client relationships


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Creating a Statement of Work• Goal:

– To develop a standard statement of work to be used along with client engagement letters as a means for preventing write-offs, any out of scope deliverables while refining client communications and managing expectations• Engagement Letter vs Statement of Work

– Defining Matter Objective– Determine what is in and out of Scope– Defining assumptions, risks, deliverables, timeline and budget– Determine frequency of client communications for matter status

Legal Process Management ReadinessFoundation

RFPsRFPs

Billing PracticesBilling Practices

Historical InformationHistorical Information


Client EngagementsClient Engagements

Plan

Process Mapping WorkflowsProcess Mapping Workflows

Cost for TasksCost for Tasks

Map to BillingMap to Billing

Design Future Process StateDesign Future Process StateWaste/Risk IdentificationWaste/Risk Identification


Execution

Conducting legal workConducting legal work

Timing/ResourcesTiming/Resources

Tracking WorkTracking Work


AnalysisMonitor/Control

Billing/BudgetBilling/Budget

ScopeScope

Process/Waste MonitoringProcess/Waste Monitoring


Improve/Lessons Learned

Consistent review of matter workflowsConsistent review of matter workflowsConsistent review of processesConsistent review of processes

Training/RetrainingTraining/Retraining



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Mapping the Current State

Breaking Work into Phases


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Areas of Waste = DOWNTIME

41.5%

16.9%

37.7%

3.8%

• Mistakes, missing court and filing dates, incomplete forms or drafting, data entry errors, document corruptionDefects• Including too many people, printing too many copies, preparing invoicing in advance, starting work on a matter before it’s cleared, scope creep not initiated by a clientOverproduction• People late to meetings, documents waiting to be worked on, warm up time for printers, interruptions, late responses from clients, slow replies to emailsWaiting• Extra counsel completing work that is best done by a client, work being done by partners rather than associates or paralegals, under utilizing paralegals, low technical competenceNon-utilized Talent• Excessive paperwork handoffs, multiple deliveries to one client, paper rather than electronic, records retrievalTransportation (of things)• Documents waiting for signatures, Unanswered/unread emails & voicemails, files sitting on desk awaiting work, conflicts awaiting clearanceInventory• Looking for files, poor office layouts, Unnecessary travel for meetings, too many keystrokes in document production, too many trips to a printer/copiesMotion (of people)• Too much research, overstaffing a file, too may reviews/turns of a document, duplicate data or case management, overstaffingExtra Processing

Mapping Processes


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Matter Template

Innovative Law Firms

A-Z


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Innovative Law Firms


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Ok, So Where Does MY FIRM Start? A to B!

LPM Seminar with Key StakeholdersReview and prioritize top processes that

align with strategic firm visionRally a leader for a focus practice or teamPerform an Assessment/AnalysisEvaluate historical matter billing informationStatement of Work ClarityMap Current Matter WorkflowsClear change procedures

Umbria demo