Use predictive data analytics to answer five common legal questions
Using data well creates value. The legal practices that embrace data-driven thinking now are putting themselves in a position to excel relative to their competitors that aren’t. But just how many questions can data and technology work together to answer? Plenty, it turns out.
1. Should we litigate this matter or settle it?
By assessing some data points – outcomes from previous cases; amount of judgments or settlements; the overall costs of similar matters – data analysis can give a lawyer or a legal team an objective answer to this question based on facts and historical data.
2. Will the motion we just filed prevail?
History tends to repeat itself, so looking at the success rates of similar motions before the same judge, or in the same types of matters, is a common way to approach this question. It can take legal researchers days, or it can take software a few seconds.
3. What is the valuation of a particular entity that is central to the matter I’m working on?
Legal matters that involve the valuation of entities, like funding activity and other deals, can get tricky. By looking at the contract value of the company’s various contractual obligations, and at risks identified in the contracts, a legal team can get answers. A robust data operation can do this in real time.
4. How much in fees should a particular matter cost a client?
As alternative billing arrangements become more commonplace in the legal services industry, firms must have comparable data sets about client fees. By looking at matter management and billing data, a firm can know the costs of similar cases and provide a fixed-fee proposal.
5. Can the matter I’m working on be pursued more efficiently?
This reflects evolving expectations from clients. By looking at matter or billing data to identify process bottlenecks or tasks that could be performed better or more quickly by other types of professionals, firms can provide better service. And making this process known to clients could strengthen the client-firm bond.
Shifting client expectations, more competition, evolving fee models, and better technologies are coming together to create unprecedented pressure on the conventional legal business model. There is no historic equivalent. Never before have lawyers had the opportunity to do so much more without a corresponding increase in time, expense, or effort.
A data-first operating model is the secret ingredient that can set firms and in-house departments up to answer the pressure and competition they are going to face – no matter what – from clients, competitors, and colleagues.