Adopting a sports mentality towards data can deliver competitive advantage to law firms
Data can unlock tremendous potential in a business, but the approach to capturing data needs to be balanced and thorough – according to Simon Farthing, commercial director at LexisNexis Enterprise Solutions.
Over the last two decades we have seen the sporting world revolutionised by its capture and analysis of data transforming the performance of individuals in teams. Data-driven insights are increasingly a topic of interest in legal, with many law firms investing significantly in dedicated teams and leading edge technologies for data-led predictive analysis.
Of course, the quality of data can make or break a data-driven business approach. So, the first question any firm must ask is – “are we truly capturing the right data, accurately and at the right point in time in our processes?” This is crucial. For instance, doing predictive analysis based on data gaps that have been filled retrospectively for the purposes of an analysis may be a futile exercise as it’s unlikely to be accurately representative of reality.
A better approach is to capture data in real time, so that the information is gathered as the task/activity/event happens and is instantly accessible. Once a piece of data is accessible, it can be fitted into any process. And when you automate this entire procedure to enable real-time data analysis, then you’re on to something!
You can leverage the data to inform all manner of activities and case decisions in a meaningful way –which cases have resulted in the successful outcomes? Why haven’t outcomes in some cases been positive? What decision making trends do we see in our best lawyers, and how can lawyers engage better internally and with clients? Where are the gaps in expertise and knowledge in the firm? How can new business leads be better triaged and onboarded to deliver a better client experience? And the list goes on.
Turn your data-driven approach to business on its head
Rich data can enable you to completely turn your approach to data-driven decision making on its head. Rather than asking your data scientists to look for specific trends, your data experts will have the ability to ‘paint pictures’ to highlight aspects of the business that you may not have thought of – areas such as closure outcomes, risk, fraud, legislative impact on business, for instance – and for your firm leaders to then interpret and take actions on these issues, as appropriate.
Consider the pilot of a small aeroplane navigating through mountains – the plane will give them access to all the necessary data in terms of air speed, altitude, wind direction, and so forth. But of course on a clear day they also have full visibility out of the cockpit, so they can clearly see the flight path, and all is well. The data is handy, but not essential when a pilot can see where they are going, although it truly comes into its own if the plane hits rough weather. If the flight is bumpy and visibility is next to zero, data becomes a guiding instrument, the ‘eyes’ if you will, that helps fly the plane, and answer questions such as what speed should the plane be flying at? What height? How strong is the tail wind? Is the airspace clear or do they need to adjust for safety? And such.
The secret to successful data-driven decision making lies in how it’s captured
To facilitate this kind of data-driven decision making, first identify where you are in your data journey. Investing in actively collating, cleaning and consolidating existing data so that the firm has complete visibility of what historical information exists, its integrity, how it can be made part of the critical business processes, and most importantly, where the gaps lie – all make up an effort worth undertaking.
Evaluate how your firm captures data. Asking lawyers to spend valuable, billable time to contribute to data gathering efforts hasn’t yet worked, and is unlikely to in the future too. Data capture simply isn’t part of their job description – they are law specialists who are focused and indeed measured on the advice they give clients to solve legal problems.
Data capture needs to be run by technology, silently in the background, in real time, invisible to lawyers and other users of technology systems in the firm. It offers the most efficient and effective way of assimilating information. Also, aside from data accuracy, gathering data retrospectively poses another challenge. Terminologies to describe things used in business are constantly evolving and changing. How do you capture information from years ago, when you don’t know what it was called then? A good technology system will provide referencing capabilities, linking different taxonomies, terminologies and phrases together to make the intuitive connections, so that the information always remains meaningful to the business.
With data capture routine, it becomes easy to overlay reporting tools such as Power BI or other visualisation applications to identify trends and insights – operational, behavioural and strategic – to deliver competitive advantage. What type of cases does the firm lose to competitors? Is pricing a factor? What are the kind of cases the firm typically takes on? What are the common challenges we face to deliver against those cases? What tasks and activities cost us the most money? Are there any consistent patterns that are emerging across our business year on year? Are there opportunities to go into new verticals or areas of law? Has the new legislation impacted success and profitability? And so on.
The sports sector is a shining beacon of light when it comes to data-driven activity. You just have to look at Formula One racing where data is holistically captured and analysed, in real-time as the race is underway – to make adjustments, predict outcomes, change strategy and win. Firms that ‘buy in’ to data in this manner can genuinely gain competitive advantage. The good news is that the technology exists – firms just need the right mindset and the correct processes to do so.
