Knowledge Management is a Business Imperative for Law Firms
Whether you practice law in a law firm or a law department, in the public or private sector, in a partnership or as a solo practitioner, knowledge management (KM) is about working smarter. It’s about understanding what knowledge you can use in your practice and in your business – and how you can leverage that knowledge – to achieve your business objectives.
Defining Knowledge Management
KM is about identifying all the types of knowledge you possess – knowledge about clients and the industries in which they operate and it influences how you deliver legal services.
KM is about managing the knowledge you have on paper (explicit knowledge) and the knowledge so intrinsic to your daily practice that you cannot quite articulate it (tacit knowledge).
KM is more than information management. Traditionally, law firms have implemented information management systems to store data relating to documents, clients, staff and finances. While these system store important data, and provide critical information in the form of reports and queries, they do not provide knowledge. Knowledge is derived from people taking information and turning that into actionable decisions.
Why Knowledge Management is Critical
Having a KM technology framework in place that facilitates the ease and accessibility to timely decision making information is crucial to operating an efficient law practice and meeting the time pressure and increasing demands of clients. Project methodology reduces the time it takes to run a matter. A repository of prior work product reduces research time. Precedent documents reduce drafting time.
Meeting Clients Needs and Expectations
Law firm clients have become sophisticated buyers of legal services. Clients now expect certain efficiencies including lower costs and faster turnaround time in handling their legal matters. In short, they expect the law firm to work smarter. With those imposed client pressure demands, the law firm must find more efficient ways to work in order to maintain its profitability. Lawyers must identify ways to leverage their knowledge and expertise.
Clients also want access to their law firms knowledge – both knowledge relating to the client, and more. Implementing knowledge management systems and processes in a law firm creates the opportunity to market these systems and processes to clients. Giving clients access to law firm management systems and processes helps to build a stronger client relationship. As a result, KM supports and facilitates one of the most critical law firm business objectives – the development of client loyalty.
In the age of instantaneous communications, lawyers have been forced to find quicker ways to deliver traditional legal services. KM systems and processes enable lawyers to work more efficiently and provide legal services quicker than ever before. The pervasive use of the internet has opened up a whole new market for lawyers to sell their services. They must examine how they use technology to deliver services to their clients. Online advisory and drafting tools can be developed and managed by lawyers to serve their clients. KM systems and processes provide the foundation for online services.
Managing Information Overload
The other factor to consider is that the age of the internet and other electronic information services has opened up a multitude of information sources for lawyers. With this comes an exponential increase in the amount of information they must digest. So how does a lawyer find the time to focus on the information that is critical to his/her practice? Just consider the risk implication of missing a critical piece of information. Lawyers must be able to access accurate information when they need it. KM involves identifying what a lawyer needs and where that knowledge can be found, and then delivering that knowledge to lawyers in an easily digestible form.
Doing Value Added Work
Creating a work environment where lawyers are intellectually stimulated and challenged is an important work/life balance factor. Also enabling lawyers to perform their work and go home is also important. Minimizing the low value added work in a legal practice is just one way knowledge management creates a more rewarding work environment. No matter how specialized a lawyer’s practice is, there will be some element of low value added work in the practice. For example, consider how much time lawyers spend on:
Drafting common documents from scratch because no firm precedent document exists
Researching a question of law using poor research tools
Searching for the correct form to use in a matter because there is no single form library
KM involves identifying low value added work and developing systems and processes to minimize the time spent on those elements. The result is lawyers having more time to spend on intellectually stimulating and challenging work. This may also lead to fewer work hours and a more balanced life.
Progressive law firms are rethinking their traditional business models. Because law firms are knowledge-based organizations, KM is critical to their continuing success and gaining competitive advantage. This is not a management fad. It is about how well you run your business and how well you use your knowledge to address the every increasing pressures and the changing landscape in the legal profession.
Looking to develop a Knowledge Management system for your law firm? We can help you do so with an integrated suite of apps from Zoho ONE to run your entire business – from client relationship management to matters and document management, along with knowledge sharing and collaboration tools and financial management and reporting. Contact us for more information or to discuss your business requirements.
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Article credits – Knowledge Management and the Smarter Lawyer – by Gretta Rusanow