Your law firm generates data. Fact. You have two choices. You can ignore that data and get no advantage, or you can analyze it and get better at running your firm as a business. Legal data analytics are a path to more clients, more profits, and a better all-around law firm.
Data analytics in the legal industry are not necessarily new. Adoption, however, has been slow in some areas. Here are seven great quotes that show that big data in the legal industry is a good thing.
1: “The price of light is less than the cost of darkness.”
Arthur C. Nielsen, founder of ACNielsen
The investment you make in analytics tools and the time you spend learning to use them are the price of light. Covering your ears and ignoring the pounding drum of law firm data analytics means you choose to remain in darkness. And it’s going to cost you – clients, money, employees, time. You name it.
What you don’t know absolutely can and will hurt your firm. And data is not knowledge. It’s just information unless it is properly analyzed. There is no part of your firm that cannot be improved by gathering and analyzing its data.
2: “Change is inevitable. Growth is optional.”
John C. Maxwell, leadership guru
How much has the legal industry changed in just the last ten years? How about your firm? If you bother to look, law firm data would tell you that and more. Change is not a legal theory, it is a reality. E-discovery is just one example.
Law firm data can reveal a great deal about what has changed and what needs to. Think of it as learning from your history. Law firm data analytics can give you the ability to predict, prepare for, and even take advantage of change. In other words, you have a choice because while growth is optional, so is decline.
3: “How does a chess Grandmaster say he can beat a computer in a chess match? Bring a hammer.”
Andrew McAfee, author of “The Second Machine Age”
As much as you might want to go with your gut, data-based decisions are going to be roundly superior. Artificial intelligence and legal analytics already exist, and they’re already working together. We use machine learning to help power GrowPath’s insights.
Numbers and facts are reliable. Predictive. Evidentiary. Thoroughly analyzed law firm data is going to beat seat-of-the-pants for results 99 times out of a hundred, and probably match it in the rare case when guesswork actually works. The client side of law firms does not run on guesswork. The business side shouldn’t either. In data – and computer and machine learning – we trust.
They won’t run your law firm for you, but they’ll give you the tools to make it better in every way.
4: “What gets measured gets managed.”
Peter Drucker, management guru
How do you know a person or process is working? Do you just look at the result? “This lawyer won a $1,000,000 fee on Case X!” Which sounds pretty good, except it took 15 years to get it. What are you measuring? How? This is a prime example of data versus analysis.
A million dollar fee is great and if you’re just looking at data, it sounds awesome. Add law firm data analytics. Processing all of the data together paints a slightly different picture: Fee, good. Time, bad. How do you improve that? Measurement produces all kinds of data. You can’t manage effectively without analyzing it.
5: “Once we know something, we find it hard to imagine what it was like not to know it.”
Chip & Dan Heath, Authors
Ok, we’re going to take this one a bit out of context. While the Heaths were referring to analysts – themselves – we believe the adage is true from a larger law firm data analytics perspective. Lawyers like to operate from a position of knowledge, and furthermore, they know what to do once they have it. Legal data analytics are a perfect fit.
When you start receiving analyses of your law firm – whatever the context – you can’t “unsee” them. That knowledge is entered into evidence forever. Your perspective, thought processes, and even goals can change dramatically.
The more you know, the more you grow.
6: “We pay very close attention to data and measurements in every action we take. From intake to disbursal, very little goes unmeasured.”
James S. Farrin, attorney, founder of one of the largest firms in North Carolina
For this one, we’re in the law firm context front and center. Jim runs his law firm on data, and is a firm believer and power user of data analytics and law. His firm measures everything it can, and analyzes it tirelessly to improve the client experience, firm productivity, and the bottom line.
Data is produced constantly in law firms, so the first order of business is to collect it. You can consciously choose what to collect through measuring, with the only limits being your measurement capabilities. The more you measure, the more you have to analyze and the more insights you can find. It’s that simple. And what you learn can have a very real and transformative effect on how you do business as a law firm. Legal analytics isn’t for anyone, it’s for everyone.
7: “Proper planning prevents poor performance.”
Eric Sanchez, GrowPath Founder
Eric’s Marine Corps background brought us this little gem, and it has everything to do with law firm analytics from multiple perspectives. First, how can you plan for success if you have no idea what success is? You need to analyze data to set growth targets, performance benchmarks, and so on.
Second, what do you plan to measure? We know that law firms generate mountains of data. Analysis isn’t as simple as just reading it all. You can decide what you want to learn about. You can sift through those mountains of data with a spoon, hoping to find some small actionable insight. Or, you can target something specific you want to improve with legal data analysis.
If you are not gathering, measuring, and analyzing your data, your firm will be past tense within ten years.
Law Firm Data Analytics Will Teach You Things You Never Knew
Corollary to Eric’s quote above is that, in analyzing your firm’s data, you’re very likely to learn things you didn’t know to ask. While you don’t want to depend on spotting trends and insights at random, that does happen.
More often, you find insights related to the ones you’re searching for, and they’re not always what you think. In this way, law firm data analytics can raise as many questions as it yields answers.
Are You Analyzing Your Law Firm Data?
And how is it working? We’re accustomed to seeing firms trying to gather and analyze their data, but the methods, tools (and results) are often mixed. The right tools make all the difference.
Lawyers like to be the smartest people in the room. Sometimes their clients’ well-being depends on it. However, we can often examine a firm’s data and deliver insights that they never would have dreamed – sometimes in under an hour.
Law firm data analytics can revolutionize your firm. You just have to do it. There are lots of tools to help. We know because we make them. And we see the difference the right tools make every day.
