Law firms and corporate lawyers are increasingly adopting the managed solutions approach to eDiscovery, and yet, for some smaller firms, the leap still causes feelings of angst. We caught up with Chris Lauer and Matt Zhun, both experienced Directors who specialize in partnering with firms to initiate or improve their use of managed solutions. They offered their perspectives on the benefits as well as the factors that either drive or inhibit adoption.

Chris, it seems like “Managed Solutions” means something a little different to everyone you ask. What’s your take?

I think it’s all about finding a custom solution for the client so that they can manage all of their cases in the most cost-efficient and predictable manner. Back in the day, our industry was very cut and dried. We had a few processes and workflows that were pretty much used the same way in any scenario, and unusual circumstances like an oddball data type could really throw a wrench into the standard process. But over time – especially over the last ten years or so – I think it has really evolved into a business level conversation: understanding what the firm is trying to solve for, and then applying the technologies and a workflow that fits that solution. And to a degree, I think it also depends on who you’re speaking to. You’ll hear different terms used to mean the same thing, like “managed services” versus “managed solutions,” and then you’ll realize that people use the term to mean different things.

 Matt, how would you define it?

I’d agree – it really boils down to taking the transactional services that we currently deliver for clients, and bundling them under a simple, straightforward pricing model that’s customized to fit the unique outcomes that the firm or corporation is trying to achieve. The benefit for us is that we’re better able to predict revenues, and the benefits to the client are numerous: one, they enjoy a more customized approach to their unique needs; two, they typically see pretty good discounts; and three, they can worry less about negotiating and billing, and just focus on the work at hand.

You’re nodding, Chris – what are you thinking?

Yeah – Matt’s point about discounts and pricing. That’s an interesting thing. Some law firms pass the costs directly through to the client, while others see it as overhead and absorb it as part of the cost of providing service to their clients. Still others will mark the costs up, whether on hours or units. So for us, it’s really about understanding what those goals are first. And that’s why I go back to saying it’s really a business level conversation – far more so today than it was, say, seven or eight years ago.

Matt, is there any difference in how you manage clients under this model? How is this different from other approaches, from the customer experience perspective?

Well, from a certain perspective, there’s not much of a difference. We still use the same team of PMs and the same systems and processes to ensure accuracy and responsiveness. The biggest difference is probably in the focus on building custom solutions to support the client’s goals, as Chris said. What’s interesting is that those solutions are not only for one-off projects – we can re-use them and adapt them as needed moving forward. And to add to that, a lot of the customization can be leveraged into automation, which typically offers even greater accuracy and cost savings.

What would you add to that, Chris?

That notion of cost savings, of efficiency – that’s really important. For example, if it’s a transactional case, we have to have an initial case call. For just about every matter, we have to get the right people into a discussion to understand the goals, deliverables, and constraints. But when you’ve been working with a practice group for three to five years, you’re actively engaged in a true partnership, and you understand exactly what they’re looking for. Everyone’s already on the same page, so to speak, so you can get going quicker, with less discussion. It’s just generally more efficient.

 It sounds like some of the benefits are more abstract – related more to the peripheral aspects of the service than the provision of the service itself. Matt, can you comment?

Sure – and that’s a good observation. One difference that I see is on the back end. Chris alluded to the idea that the focus is very often on what the client is trying to achieve financially. Are they trying to pass this through as a cost savings to the client? Trying to cover their own costs? Are they trying to turn it into a profit center? For any of those models, they need to be able to readily understand the bills at the end of the month, so that they can turn around and bill their own clients correctly and efficiently. So what we deliver on the back end, from an ease of billing standpoint, is as important as what we deliver on the front end.

 What’s your take on the adoption rate? And when firms either do or don’t adopt a managed services approach, what motivations do you think are driving the decision? Chris?

I think we’re in an industry that’s very slow to adopt anything. Managed solutions have been around for seven to eight, maybe even 10 years, but I don’t think we have a high adoption rate, compared to the same kind of approach in IT, for example. But what I do see today is that this model or similar models are increasingly useful for the small- to medium-sized firm. These are firms that don’t necessarily have the budget, so they’re really focused on efficiencies. And they don’t necessarily have the people, or if they do, they’re overworked. They need help. What we’re finding today, I think more than ever, is that we’re fitting into that mid-sized law firm that has the expertise and the caseload, but doesn’t necessarily have the bandwidth to put together a high-level strategy built on customized, efficient workflows.

Matt, what would you add to that?

Maybe I have a slightly different viewpoint. I think there’s been a tremendous adoption amongst the largest firms that have huge workloads and big data sets, and numerous cases that can support the bandwidth that managed solutions provide. But as Chris said, there hasn’t been as much adoption in the smaller and mid-size firms, where you have somewhere between 20 and 70 attorneys. And I think that’s because of two factors. One, they don’t quite have the consistent flow of work to justify it, and two, most of the service providers have really left them behind. They can’t be bothered with a one terabyte environment, especially if they’d be expected to provide the same level of support they’d offer their 40, 50, 100 terabyte environments.

As a smaller, more nimble company, Trustpoint has realized that it makes sense to support that mid-tier market. We’re helping them reap the benefits by making managed solutions accessible even if you’re not a giant firm.

Earlier, you spoke about customization. Do you think the customizability helps those smaller firms shift to managed solutions? Are you able to be more creative about how you bundle services, Matt?

I think it allows us to better support them in differentiating themselves to their current and potential clients. For example, think about a mid-size firm that has a healthcare client. Suppose the client has experienced a data breach, and the firm has brought us in to help. Having gone through the breach review and remediation process, the firm can now go out and use that experience to gain new healthcare clients.

Chris, what are your thoughts on differentiating factors?

Well, “People, Process, and Technology” has been around for years. That’s not groundbreaking by any stretch. But I think it’s about how we apply those pieces. We recognize that client needs and goals are different in every conversation, so we use the pod approach for project management. It’s very different, very agile – we have a group of three to five PMs working with all clients, regardless of the service model they’ve chosen. And for clients who’ve adopted a managed solutions approach, we truly become partners and an extension of the firm’s team. So someone is always available to respond to questions and concerns, and they’re experts not only in the technology, but also in case management. Combine that with the institutional knowledge we gain by building long-term relationships, and we’re able to give our clients a whole host of resources and a degree of support that they wouldn’t have access to otherwise, all via a simple partnership.

What about the challenges? Where do you see clients struggling with the decision to move toward managed solutions?

I think challenges often arise when the left hand doesn’t know what the right is doing. Firms have various practice groups, each of which might be dealing with multiple vendors. They have clients that might deal with vendors directly, and they have outliers, where they might bring in a consultant or a specialist to deal with a unique situation. That makes it hard to even understand exactly what you need.

When that’s the case, we’ll usually start by looking at things on a 30 day basis. Then, after a few months, we can look back and give you statistics about data volumes, services, and so on. That lets you make an educated decision about how we can best meet the needs of the business.

And what’s your take, Matt?

I totally agree – the biggest thing I see is that clients need help benchmarking so that we can provide the right size of environment. And the fear is that even after benchmarking everything, the caseload might go down. You know, if a few big cases settle, the fear is that they’ll get stuck paying for a terabyte environment when they only need to handle 600GB.

What’s the answer?

Right-size it. Overages and shortfalls are common – we’ll just redo your bundle for that month and make it right. New buyers tend to be concerned that they won’t be able to use all the services they’re paying for, and even with the discount, there’s some fear of the commitment. But like Chris said, we need to develop this relationship over several months – that gives our clients confidence that managed services really can work for them.

Again, it’s all based on what you’re trying to achieve. Let us find the path to get you there.

What a great note to end on. Thanks, Chris. And Matt, thank you too – for your insights and for a terrific conversation.

Chris Lauer is a Senior Director with Trustpoint.One who has been helping law firms and in-house counsel implement cost-effective eDiscovery solutions for more than 15 years.

Matt Zhun is a Managing Director who is similarly focused on supporting legal departments and law firms in effective utilization of technology and alternative fee arrangements.