In the January BTI Market Outlook and Client Service Review 2014, we learned that corporate counsel spending for outside counsel is flat and that competition for “primary” or even “secondary” law firm status is highly competitive. However, firms that can deliver consistently superior client service will win the hearts and pocketbooks of their corporate clients and be able to grow their business, outstripping the legal services industry’s current flat growth trend.
A firm’s knowledge base, both physical and intellectual, is one of its greatest assets and, when leveraged well, can create a competitive advantage that will result in a superior quality work product in less time. Central to the development of a knowledge base is the need for attorneys to share information. In my experience, those firms that are able to gain attorney buy-in and then develop KM initiatives that effectively leverage that knowledge base tend to be the most successful over time.
The Sharing Problem
Attorneys must be willing to share their relationships, their expertise, their forms and templates, and even their bits of insight on their clients’ needs. Unfortunately, this is where the problem lies—attorneys as a group have personality traits that make sharing not intrinsic to their natural way of functioning. To make matters worse – and perhaps in part because of those personality traits – many law firm compensation structures do not adequately reward attorneys for sharing.
Dr. Larry Richard, an attorney and psychologist, has explored attorney personality traits for over 20 years using the Caliper Profile. His research shows that, as a group, attorneys score far higher than members of the general public for a personality trait known as skepticism. In fact, they tend to have an average score in the 90th percentile for this trait. “People who score high on this trait tend to be skeptical, cynical, judgmental, questioning, argumentative and somewhat self-protective” and have a tendency not to trust others. Although skepticism may serve attorneys well in representing clients, it can detract from a collaborative working environment.
Indeed a climate of trust is essential to delivery and effective use of information capital at a firm. If attorneys are skeptical of the value of sharing their information, they are less likely to share it – even if it may benefit the firm and result in improved client results. If KM professionals have to spend much of their time and energy defending the need to share information, rather than organizing and creating easy access to it, they may waste considerable time “making their case” instead of proving its value through improved shared resources. In my experience, potentially beneficial KM initiatives dependent on shared information will wither and die in a firm climate that does not support sharing.
Compounding attorney personality tendencies are attorney compensation models that may not reward sharing activities. Financial rewards must be given to attorneys to engage in non-billable activities that deliver information. Without financial compensation, there simply is little incentive to take time away from billable or revenue generating activities for important KM initiatives. Firm administrators must expect that attorneys will share their intelligence, and KM professionals must make it quick and easy for them to do so, so that they can effectively leverage it for the benefit of all firm members.
Examples of Success
In my many years of working with firms, I have been fortunate to learn of some great examples of effective sharing programs at law firms. For example, I know of one practice group that is highly dependent on form documents for its practice; the group carefully creates and regularly updates templates through a committee process. No changes are made to the templates without review of the necessary changes by those who are most familiar with changes in the law. Also, the documents are secured so that only members of the team have access to the templates, and any use of those documents results in a financial credit to those who created those forms.
Another successful content sharing program I have seen is the use of dynamic public Outlook folders mapped to a legal taxonomy. Each folder contains the top node of the legal taxonomy, with sub-folders for categories of content. Each document is placed in an appropriate topical sub-folder, with the document name displayed through a single click drill-down. Locating this content in Outlook is ideal given that Outlook is where most attorneys live for much of their time in the office. The browsing capability through the familiar click-through tree format is understood and easy for attorneys to use. The documents all have security so the templates cannot be modified without approval and the public folders are displayed only for those who should have access to those documents. All attorneys who contribute to this document repository are rewarded at compensation time for sharing their content.
Although many other examples of effective KM programs that reward attorneys for sharing exist, we all have colleagues who hoard their intelligence hoping that it will garner them exclusive power and future revenue opportunities. They hope that by retaining exclusive control over key client relationships, intelligence on client needs, and valuable work product they will have a competitive advantage over their colleagues. That way of thinking is from the old world where knowledge was power and where collaboration and sharing were not essential to the growth of all business, including law firms.
This old perspective is one that I would have expected from the US military intelligence establishment, which is why I was surprised to hear Stanley McChrystal’s recent TED Talk on sharing. He describes why US military leadership decided to embark upon a cultural shift from the old “knowledge is power” intelligence strategy to a new “knowledge is shared” policy. McChrystal sought to give intelligence to not only those with a demonstrated need to know, but also those who should know and could make positive use of it. McChrystal notes, “[I]t was [a] fundamental shift, not new tactics, not new weapons, not new anything else. It was the idea that we were now part of a team in which information became the essential link between us, not a block between us.”
In the US security context, the risks associated with sharing information with those who may do us harm are high and must be thoroughly assessed because failure can be catastrophic. Unlike the military environment, however, the risks associated with oversharing in the law firm context are low and largely preventable. Concerns over sharing information with colleagues who may not be experts in the use of a template, may want to undermine the client relationship, or do not fully understand the nature of the work or relationship can all be mitigated by reasonable KM policies and financial rewards for productive sharing behaviors.
I believe there is a compelling business need to share intelligence within law firms to deliver better client service and work product, and those who are able to effectively leverage shared intelligence will become the most powerful and profitable firms over time. If the U.S. military can change its ethos, I believe law firms – even with their lot of skeptical lawyers – can change as well.