Much of this blog post is taken from a more comprehensive white paper, The Legal Professional’s Competitive Survival Guide. Click here to view it.

There’s been a lot of talk out there about how organizations are using data analytics to get an edge on the competition. The movie Moneyball chronicles how it was leveraged in Major League Baseball. It can play a big role in the success of law firms, too.

Building a data-driven legal practice isn’t going to happen overnight. But starting down that road isn’t the Herculean task that it may seem – even for small firms.

Here are five good starting points:  

1. Walk before you run, and start with the low-hanging fruit

The place to start with using data to enhance your practice is probably in comparatively mundane applications like your own billing and matter management systems. They hold a goldmine of data about productivity, value, talent, results, and outcomes.  

Start with straightforward business issues such as staffing work, pricing it, and managing capacity. Then look at the data that might answer those questions, and find or build tools that can access it. And then look for the people on the development side who can take it from there.

2. Identify and organize your data

Legal software is only as effective as the data it relies on to do its job. So, it’s all about the data.

The early stages of analytics initiatives are mostly focused on the process of getting a firm’s data into shape and building processes to capture data. This involves getting data structured in the right way … getting it out of, for example, disparate and unwieldy spreadsheets that law firms maintain for data collection processes and into an organized and structured format that is both secure and shareable among those with the appropriate access permissions.

This stage also includes identifying external data sets – from dockets, legal research databases, and other third-party sources – that can be tapped and correlated with internal data.  

3. Clean up your data

Data hygiene is a critical step. Terms and classifications for treatments, for example, need to be fully standardized.

Docket data from state and federal courts can be messy, as it comes from a multitude of courts using various systems and terminology, and different data standards. Simply normalizing and cleaning up that data, a process that Thomson Reuters invests heavily in, is difficult enough.

Billing data and matter management data in firms may also need some tidying up. The systems that support those functions generate incredibly valuable data, but they often weren’t designed with the extraction and analysis of that data in mind.

4. Collaborate with those who know data well

Imposing that kind of data hygiene involves relying on people with good data skills working side-by-side with the legal professionals who understand the significance of the data.  

This is not a natural partnership that most lawyers are comfortable with. But it’s part of the mindset shift that legal professionals need to make. It’s a bit of a stretch for data professionals as well. They might not see the legal significance of a certain terminology or classification in data sets – but those distinctions can have huge legal ramifications. So, data professionals working in the legal space need to acquire some level of legal subject matter expertise in order to fulfill their roles properly.  

5. Build a data-driven culture in your firm

Building a data-driven legal practice is not something you assign to a department or, in a small firm, to an individual. It requires buy-in from everyone … from leadership that is prepared to invest in it, to the professionals tasked with building applications, to the workflow owners who have the task of altering the way work gets done, to the practitioners who have to trust the data and build data-driven predictions into the advice they give their clients.

None of this comes easy and it all comes down to building behaviors and practices that support the idea that “this is how we do things now, and it’s better than prior practice.”  

Creating a data-driven legal practice is a matter of competitive survival. And it’s much more than simply the adoption of a new tool or product. It requires a shift in mindset for individuals, and a significant cultural change for their firms.

The future, as they say, is now. The successful firms will be those that are best able to navigate that transition to a new, data-centric legal services industry.  

Portions of this blog post come from the white paper: The Legal Professional’s Competitive Survival Guide.

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David Curle, Director, Technology and Innovation Platform supports Thomson Reuters’ Legal business with research and thought leadership about the legal technology and innovation ecosystem, and the changing legal services industry.  Prior to joining Thomson Reuters in 2013, he led coverage of the global legal information market for the research and analysis firm Outsell, Inc., tracking industry performance and trends.  He is a regular contributor to the Legal Executive Institute blog and speaker at legal industry events.  He has a JD from the University of Minnesota Law School and a BA in History from Lawrence University.