2/19/18

My legal tech invention: the Magic Money Machine

A Watched Pot

I invented a new tech product for the corporate legal market. I have no qualms labeling it "the ultimate disruptive game changer." I hope you are sitting down for this.

The Magic Money Machine™ is a proprietary IoT platform that leverages blockchain technology and deep-learning algorithms to reduce friction in the legal supply chain. Inside and outside counsel need only to both plug in the MMM (sadly, my branding team informs that M&M, 3M, and M3 all seem to be taken). That's it. No learning curve. No changed behavior. No implementation dip. No risk. Also I am giving it away free. I charge only for shipping and handling (order now and get a second one at no additional charge).

If both sides have the MMM plugged in, the corporate client's costs will be reduced by 25%, and the law firm's profits will increase by 25%. A win-win from mutually beneficial collaboration, a truly beautiful thing.

So here's the question: how long will it take MMM to achieve market saturation?

We'll define saturation here as being in use by a majority of lawyers in the Fortune 200 and Am Law 200. Because this is a thought experiment predicated on an unadulterated no-brainer, the gut response should be something along the lines of: tomorrow. MMM should be a phenomenon that spreads faster than photos of a shirtless Tongan Olympian.

But, of course, that's not how it would happen.

Because issue spotting is kind of your thing, you immediately diagnose the core failing of my go-to-market strategy: Dude, it doesn’t exist. What do you expect? You’re, literally, pedaling magic. Even if you could invent it, no one would take you seriously. It is too far fetched. You need to focus on solving real, well-articulated problems with practical, extant solutions. Pragmatism. Calibration. Bricolage. Not fantasy nonsense.

Fair. Though let me ask you this: how likely are we to devise an innovation more practical than boiling water? Is any problem we're solving more immediate and impactful than eliminating typhoid and other water-borne diseases?

No? Then I’ve got news.

Rogers— he of adoption curve fame—opens his textbook, Diffusion of Innovations (5th Ed), with a case study of a health worker who spent two years failing to convince a Peruvian peasant village to boil water. The village had a public health crisis. Boiling their drinking water would solve it. Only 11 out of 200 families accepted and incorporated a simple practice that was free and would deliver immediate, tangible benefits.

Rogers deploys the anecdote to introduce the critical point that innovation is largely a social process, and we ignore the structural barriers to innovation at our peril. I use it here to make a smaller point about empathy—our practical solution may be someone else’s nonsensical magic.

Again, you, my beloved strawman, are a master advocate: Way to cherry pick a super sad story, bro. The plural of extreme anecdote isn't data. And you are comparing corporate-sector lawyers to Peruvian peasants.

How about doctors? There is an eerily similar story to tell about the decades it took doctors to accept and start to apply the empirical evidence that washing their hands before surgery was in the best interest of their patients.

Come on, my guy, stop the silliness. That was almost two centuries years ago. You keep not describing the world we actually inhabit.

How about studies from 1996, 2009, and 2016 about doctors still not washing their hands nearly much as, well, doctors recommend? There remains the inconvenient fact that medical error is the third leading cause of death. Atul Gawande’s The Checklist Manifesto is not only one of the most important books of this decade, it is also one of the most tragic. It is a painful tale of how hard it is to get autonomy-loving professionals to do simple things which they should very obviously be doing (see also teachers).

Since moving the goalposts is one of your core competencies, you have a retort: Fine. So doctors have some serious principal/agent problems.

Yes, well, law has its own agency dilemmas. But how about people and their own health? After needing an angioplasty, people rarely meaningfully change their lifestyle habits for a sustained period. A common statistic (for which I cannot find the underlying study) is often attributed to Dr. Edward Miller, former dean of John Hopkins medical school, “If you look at people after coronary- artery bypass grafting two years later, ninety percent of them have not changed their lifestyle.” Hard to construct anything more personal and pressing than one’s own imminent death.

Yeah, well, whatever. Everyone knows that medicine is mostly about signaling care, not science. If you think about it, invisible little organisms and unseen bodily processes share many properties of magic. They are hard to integrate into our mental models even when we have the vocabulary. Is there really that big an intellectual distance between a healthy gut microbiome and midi-chlorians?

No. No, there isn’t. But for many nose-to-the-grindstone legal professionals there also isn’t that much to distinguish the Magic Money Machine from obscenely practical approaches like prevention, Lean, after-action assessments, and #DoLessLaw, let alone the mystic arts of analytics, algorithms, and distributed ledgers.
But, sure, let's make innovations more transparent (if not more practical) than boiling water and washing hands and see where that gets us.

The Perfect Information Game

Much has been made (including by me) about the day in 1997 when "In brisk and brutal fashion, the I.B.M. computer Deep Blue unseated humanity." Though, as I've remarked, the real lesson to take from silicon unseating carbon-based champion Gary Kasparov is probably related to the felled grandmaster's subsequent observations on hybrid chess where, "Weak human + machine + better process [is] superior to a strong computer [or strong human] alone and, more remarkably, superior to a strong human + machine + inferior process."

At the time of the shellacking, chess was deemed "the brain's last stand" against Skynet because it was, and largely remains, the domain of the cerebral. Meatheads need not apply. For 1,500 years, the planet's keenest minds had been perfecting our approach to the quintessential perfect information game.

But a funny thing happened after the robot apocalypse. Humans suddenly got appreciably better at chess. Not better than the machines. That ship has sailed. But having our tookus kicked by some integrated circuits changed how we played the Game of Kings. That is, "Grandmasters that have grown up with most of their training in the computer era play a much more objective style of chess.  They’re less willing to dismiss a move because it’s ugly, or doesn’t appeal to their aesthetics."

Confusing style for substance, chess had been stuck in a local optimum for a millennia:

In mathematics and computer science, a local optimum is the best solution to a problem within a small neighborhood of possible solutions. This concept is in contrast to the global optimum, which is the optimal solution when every possible solution is considered.
Our sharpest minds playing for real stakes (pride, status, money) had spent centuries trapped by what they thought knew about a discrete, stable set of problems. Even their innovations occurred within the parameters of false constraints. It required an existential event for the smartest people in the world to evolve their thinking.

You know, Casey. You are starting to bum me out. And I'm losing the will to serve up any more softballs. But might I suggest that chess is not an easy problem to solve? It took the computers, and the many geniuses behind them, almost 50 years to beat us. Maybe it's not the best example of how people comprehend the opportunities available to them from changing ingrained behaviors?

Again, fair. What about three being a larger number than two (3>2)? Is that easy enough to understand?

I freakin hate you. I hate you so much. I hate your stupid face, your flippant tone, and your unconscionably long posts. And I hate myself for taking the bait. Proceed. I have to see where this goes.

From Downtown

I adore my sons. They are my favorite people. But I've discovered I will never love them enough to deceive myself into finding first graders playing basketball a great spectator experience (every Saturday). What they lack in acumen, they also lack in style, grace, and understanding of the rules of the game. It's brutal.

But despite the double dribbles, aversion to ball movement, and preternatural enthusiasm for post-game juice boxes, their tactics are not without merit. They seem to intuitively understand that the dominant strategy is to take the most open shot possible as close to the basket as they can get. The higher percentage shot is always superior—as long as all shots are of equal value.

In the NBA, all shots are not of equal value. The NBA introduced a three-point line in the 1979-80 season. The arc indelibly altered the geometry of the game. In general, the greater the distance from the basket, the lower the percentage chance a shot will go in. When all shots are worth two points, get as close and as open as you can. But with three pointers, the math changes.

Long two pointers still go in at a higher percentage than even longer three pointers. But 3>2. The three pointers are worth a full extra point. A three-point shot that has a 35% chance of going in has a higher expected value (1.05) than a two-point shot that has a 50% chance of going in (1.0). Better to take a three than a modestly higher percentage long two. This observation does not demand differential calculus and lends itself well to digestible visualization:

The math is simple and unassailable. And yet it has taken decades to be accepted and implemented. Here is the evolution of three-point shot attempts:

Returning to Rogers' point about innovation being a social process, there is a phenomenal longform piece from Tom Haberstroh on "The NBA's 35 year war over the 3." Haberstroh dives into how much traditionalists hated, and continue to hate (hate, hate, hate, hate), the three-point shot. The piece includes quotes from original three-point shooting savants like Larry Bird. Larry Legend's thoughts on the three pointer, "I really don't like it...I don't know why I never liked it."

High stakes. Compelling value proposition. Easy math. Transparent, competitive environment. And yet extremely slow to change. Even those who directly benefited from the innovation express reservations about resulting shift in the strategic equilibrium. It's a familiar story (see also football and baseball, as well as Mark Cohen's great piece comparing the legal market to the latter).

Why So Serious?

The foregoing material came out of a hopeful talk I gave to a law company. I found inspiration for the post from the wonderful ALT conference I attended last week.

Hopeful? Inspired? There is something seriously wrong with your brain. You just told us people won’t boil water to keep themselves and their families healthy. You told us doctors are selfish killing machines. You told us that even chess prodigies get snared in false mental constraints. You told us it can takes decades to come to terms with 3>2 even when glory and millions of dollars are on the line. How is that hopeful for anyone who wants to make change in the legal industry?

Because (a) the frustrations of the legal change agent are not unique and (b) there was real, material change in every scenario I presented.

The Magic Money Machine is intended to trigger our intuitive mental model of change. This makes sense. So this will happen. Soon. Everywhere. We do not naturally think in systems. Systems have emergent properties, many of which promote stability and therefore impede the diffusion of innovations.
The boiling water anecdote demonstrates those systems at work while also illuminating the curse of knowledge. The curse of ignorance is that we don’t know what we don’t know and therefore labor under delusions of adequacy. The curse of knowledge is that once we know something, it is hard to imagine not knowing it. The resulting mistakes about shared assumptions can be invisible barriers to change. Those unrecognized barriers are why, with boiling water, the change only occurred among a small set of outliers.

The dirty-handed doctors did change. But they resisted change for a long time. Even after the change was accepted, maintaining the modified behavior at an appropriate level requires discipline, rigor, and systems for monitoring (as you learned when you clicked the links, which I'm sure you always do).

Chess strategy was always evolving. Evolution was accelerated by a large, exogenous shock. A vastly superior player was introduced suddenly. The best human players were afforded the opportunity to practice against it all the time. Of course they got better and adopted some of its strategies.
And the NBA has embraced the three-point shot. It just took a while.

I relayed simplified stories. I omitted many confounding factors (my posts are too long as it is). But there was a salient omission about the NBA: in the beginning, the players were mostly terrible at a shot they had never practiced. So the shot's expected value was low. With a low expected value, it was inadvisable for coaches to design offensive systems around three pointers. And it was therefore rational for players to continue to focus on developing skills that fit the coaches' systems. Which meant the coaches didn't have the personnel. Which.......

Despite this chicken-and-egg problem, exacerbated by traditionalist caterwauling about 'the way the game is supposed to be played', the systems, personnel, and skills evolved to conform to the logic of the changed reality. It was incremental. But it happened. I know this because I am doomed to live with three Golden State Warriors fans. They are insufferable.

Each story resembles the legal market in some way. We want to pull our hair out because it often seems like only the outliers are willing to incorporate the obvious and practical (boiling water). A major factor is autonomy-loving professionals resisting reasonable recommendations to modify their behavior for the benefit of their clients (unhygienic doctors). Mix in some exogenous—shocks like the Great Recession—and some automation anxiety (chess). And you've got slow, uneven movement towards a new normal (NBA) as regulations, systems, skills, and mindsets incrementally co-evolve.

The final story is closest to my view of the legal market. Except we're the NBA circa 2001 (too much iso-ball). I see change. I expect change to continue, albeit incrementally. We may enter a period of rapid evolution. Or not. Regardless, unless you are operating on a short time horizon, betting on change is safer than betting against it from a portfolio perspective. But that does not mean all bets on change will pay off, especially in the near term.

This was my message to the law company. They believe they invented a Magic Money Machine and have proven that it works. Yet much of the market still reacts with a yawn. I tried to validate feelings—their frustrations are righteous. I wanted to reassure them that they did not make some grave mistake by choosing law—inertia is an issue everywhere. I attempted to offer some explanations for the gap between their expectations and reality. And, finally, I wanted to communicate a long view premised on muddled movement in the right direction.

Any of other message would have rang hollow. It would have been ludicrous to tell them that real change isn't happening. They are a manifestation of that change. They've grown 10x over the last decade and the "gnat in an elephant's ear" is beginning to buzz pretty loud (for reasons). At the same time, a rah rah speech on how everything is awesome would have struck a false note. Their 10x growth was hard won and, anyway, should have been 100x. We continue to live in a Sisyphean world. And no one truly knows where the tipping point might be, if one even exists.

But that's ok. We've come a long way. And we continue to push forward. That was one of my takeaways from the excellent ctrl-alt-del Conference I recently attended in beautiful Scottsdale (oddly, a better February venue than NYC).

As I noted in the ReplyAll conference thread, I was enamored by the history lesson. Rick Hellers traced ALT's origin back 35 years to user groups for VSLUG and LAWNET. At the time, they were law firm professionals helping each navigate the application of technology to improve the practice of law for the benefit of clients. They are still at it. And they are as passionate as ever—made abundantly clear by the lively interactive sessions (stellar conference design).

When I, too, was a disaffected Biglaw associate, I would have ridiculed Zach Abramowitz's pre-conference thesis about the important role law firms play, and will continue to play, in delivering and spreading innovation. But then I went in-house. After that, I founded a legal tech startup and began consulting. I eventually came to terms with the reality that innovation and frustration coexisted everywhere in our ecosystem. Both were evident at ctrl-alt-del with a strong emphasis on the innovation.

Candidly, for too long, I fixated on the frustration. But the magnificent Bill Henderson introduced me to Rogers (whose text I am sure will inform the new Institute for the Future of Law Practice). Maybe there is something wrong with my brain, but I found enormous comfort in learning how much work and savvy was required for a well-intentioned change agent to convince people to boil water for their own good.

We're not that extreme in our change aversion. We're not hopeless. We've not reached some state of innovative perdition. When we get past the constant disappointment that accompanies a Magic Money Machine mindset, we can appreciate just how much we have changed and recognize that change will continue. We need not delude ourselves that change will come easy as long as we remain convinced that the hard work will be worth it. We can be hopeful without being satisfied.

______________________________________
D. Casey Flaherty is a legal operations consultant and the founder of Procertas. He serves on the advisory board of Nextlaw Labs. He is the author of Unless You Ask: A Guide for Law Departments to Get More from External Relationships, written and published in partnership with the ACC Legal Operations Section, and the Service Delivery Review Primer, written for the Buying Legal Council. Find more of his writing here. Connect with Casey on Twitter and LinkedIn. Or email casey@procertas.com.

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2/15/18

Amazon Treasure Truck: yet another POS that turns shopping into a scavenger hunt

Well, I had a fun shopping experience that I thought I would share--Amazon's Treasure Truck. It is kind of internet-y and social media-y thing I can chat about.

It is yet another POS that Amazon is owning.

Basically, you sign up for text messages through Amazon to be notified when their treasure truck is in your area with a hot sale item. You then reserve the item, select pre-set pick up location, then pick it up at the appointed time. The oddest thing: no money changes hands.

Amazon Treasure Truck: yet another POS that turns shopping into a scavenger hunt

(Photo courtesy of Amazon)

Cities with Amazon Treasure Truck

I'm kind of late to the game--Amazon's Treasure Truck launched in Houston back in July. Around for two years, The Treasure Truck is in major cities like Seattle (naturally), Portland (of course), 5 California cities, 4 Texas cities (including Houston), a few Florida and New England locations (including NYC) and a smattering of Midwest cities.

The deals are pretty significant. I got a Nespresso Pixie for $115. I priced them at Macy's, Bed Bath and Beyond and some other online retailers and the same item was retailing for $150 and up.

Amazon Treasure Truck deals

Yesterday, for Valentine's Day, they were offering a box of 12 Godiva chocolates and a dozen red roses for $22. That is a bargain. A dozen red roses, alone, can cost at least $25. A box of Godiva Chocolates are $32. Pretty sweet!

They also sold the release of the Harry Potter book for a nice price of $17.99.  They have sold oysters, Hatchimals, GoPros, filet mignons and anything else that Amazon can think of.

The game of it all

For some reason, it feels fun and game-y. I'm not sure why? Maybe because of the scavenger hunt feel, along with the promise of a prize. I do realize I paid for the prize. I guess it is the idea of getting a deal.

A part of me felt like I was buying something from someone's trunk. But another part of me felt like I was hanging out at a food truck. A very odd feeling. It is a very festive truck and the guy couldn't have been nicer.

The nice/weird thing: no money changed hands. I just showed the guy a QR code on my phone (by the way, this was the first legit reason that I've ever seen for a QR  code). That made it feel even more game-like. The downside? I had to hang around that part of town for an extra hour and I ended up doing other shopping to kill time.

So I really did pay $150 (or more) for that Nespresso machine.

Maybe I need to plan better next time.


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2/8/18

A Librarian By Any Other Name…

Last week, I had the pleasure of visiting New York City during LegalWeek and enjoying the frigid 19 degree weather that comes with visiting New York at the end of January. LegalWeek itself is typically made of of legal technology folks and lots of e-discovery vendors, most of whom are outside my normal circle of friends and colleagues. Luckily for me, there is a group of Knowledge Management leaders attends a little informal gathering and we talk and bounce ideas off of one another. During the introductions phase, I saw a trend in titles among my librarian peers. Out of the total of about 75-80 people in attendance, 15-20 people there that I knew were managers, directors, and chiefs over their law libraries. So, about 25% of the attendees were law librarians. However, only one actually had the term "library" or "librarian" in their title. I didn't find it all that surprising, but it was something that stuck in my mind and made me contemplate once more what others think of when they hear that someone is a librarian.

Let me start this conversation by modifying something I wrote when I said that "the library is not about the space." Librarians are not restricted to a librarian title. Creative librarians bring value well beyond what is stereo-typically thought of in regards to what a librarian does. As in many industries, as librarians move up the ladder, we expand our responsibilities and skills in a way that breaks down the walls of what people think librarians do. As a result, we take on new roles and titles that may or may not have the word librarian in it. It doesn't mean that the librarian profession is somehow devalued, in fact, I would say that it is the opposite. Librarians are breaking barriers and advancing into positions which a decade or two ago would have been unobtainable.

I am a law librarian. But you wouldn't know if from my title as Chief Knowledge Services Officer. Because many of us oversee services like research, competitive and business intelligence, knowledge management, conflicts, intake, records, due diligence, and other duties, we've changed the scope and the titles of our departments, and our staff as well as our own titles. Regardless of those department names and job titles, we still regard ourselves at librarians. And take pride in that. That being said, the work we now oversee is not solely that of a librarian, and we are seeing others enter the domain of what we might have thought to be "law librarian" work, and turn that into "legal information" work. On the flip side, we are seeing those who are professional law librarians move into specialized work that fits their skill sets, but in not viewed as "law librarian" work. Both of those scenarios are great for the law librarians and the legal industry as a whole. It is an expansion for librarians to take on new roles, as well as lead others who are highly skilled, but not necessarily law librarians. It's a great opportunity for those willing to seize it.

The discussion regarding the value of the terms "library" and "librarian" is much like dancing on the edge of a knife. Many law librarians have a strong attachment to the term and reject the idea of using other terms, or expanding beyond traditional law library titles and roles. I think that is far too narrow, and we tend to be too exclusive a profession. We all remember the uproar when the American Association of Law Libraries asked its members to change the name to the Association of Legal Information. That was soundly defeated (4 to 1) with many saying that they were not ready to remove "Libraries" from our identity.

I'm not saying that we should fight that battle again. But, I did talk with someone at the LegalWeek conference about that and said that he looks back now and realizes that there was an opportunity missed for the profession. He was in the camp of not changing the name because he thought it would lessen the stature of law librarians. Now he looks back and sees that he was being too restrictive in his thinking and that expanding beyond the title wouldn't reduce librarians' influence, but rather would have opened the door for librarians to expand their influence in the legal industry.

This was a long way to discuss the fact that law librarians bring great value to the legal industry, with or without librarian titles. We should not be limited to specific titles or responsibilities. Just because a librarian now has a title without the word library in it doesn't lessen their influence as a librarian. We are about the skills we bring. We are about the way we train our staff and have them engage in the strategies of our organizations. We are about the way we lead fellow law librarians, and other professionals so that they are solving problems and bringing value to the entire legal industry. We are librarians, but we do not have to be called librarians in order to advance the values and skill of our profession.

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1/28/18

How much of lawyering is being a copy-and-paste monkey?

First, an unqualified endorsement:
Ken Adams's A Manual of Style for Contract Drafting, Fourth Edition is essential for every professional involved in the contracting process from negotiation and drafting to interpretation and litigation. MSCD has no peer in explaining what contracts do and how they should be constructed. The breadth, depth, and clarity are astounding. As is the usability. This is a well-organized reference containing pinpoint guidance on clause types, word usage, and formatting.
If we truly believe that we should do the best we can until we know better, then do better, we have a professional obligation to grapple with, and then make use of, the expert guidance MSCD provides. When light is offered, complacency is no excuse to continue in the dark. MSCD shines a bright light on how to best solve for complexities of contracting in pursuit of business objectives.
Anyone interested in contracts should also read Ken's blog.

Had to get that out of the way because it is deserved and standard book reviews are not my MO.

"An unqualified endorsement" in both the sense that it is without reservation and that the person making it (me) lacks the appropriate qualifications. Reading Ken triggers my almost debilitating impostor syndrome. I've battled the affliction since I commenced my legal career with the observation: Clients are paying how much per hour for me? To do this? Really? Something is very wrong here.

Ken is also a stark reminder that lawyers, in general, are not so consistently excellent at what we do that we should be exempt from scrutiny, discipline, rigor, and the clarion call of continuous improvement.

Copy-and-Paste Junkies
This week at Legaltech New York, I look forward to learning about the math behind the claim that clients spend that $75 billion per year on legal document creation. I, however, already possess ample evidence that, in creating these documents, legal professionals are generally incompetent with the core technology tools of their trade.

People don't argue with me directly much anymorethough they may still try to hide behind outliers, those mythical digital natives, and the delegation dodge. Instead, they shuffle priorities. Even though 99% of fee earners identify Word as a "critical tool," when challenged, they posit that using Word correctly isn't 'real lawyering.'

For me, any action is sufficiently 'real' if it influences quality, speed, cost, or consistency. Incompetence with technology affects all four. What my critics are really saying, I hope, is that technological aspects of properly structuring a legal document are not where lawyers add the most value. On this, we agree. Which is precisely why I consider the attention wasted fiddling with the non-substantive aspects of legal documents a value-reducing tragedy worth remedying.

But they persist in a false binary. Since we agree that what gets written is more important than the underlying digital document construction, they believe I have conceded that their technological incompetence can continue to be ignored. Lawyers should be given a pass on their poor proficiency with the tools they use to write because they are so damn good at writing, which is where the real value lies.

Enter Bryan Garner. Garner has organically captured the majority of Google's prime real estate when searching for a "legal writing guru" (h/t to the great Ross Guberman, Gary Kinder, and Ivy Grey, as well as their tools, in their quest to help lawyers write good).

Garner contends that "lawyers can't write." I'm quoting, not paraphrasing: "lawyers on the whole don't write well and have no clue they don't write well." When it comes to writing, Garner identifies lawyer self-regard as a manifestation of Dunning-Kruger. Lawyers: "(1) often think they are quite skillful or knowledgeable, (2) can’t recognize genuine skill in others, (3) uniformly fail to recognize the extremity of their own inadequacy, and (4) can recognize and acknowledge their own previous unskillfulness only after highly effective training in the skill."

But that's one man's opinion. What say our computer overlords? Judicata "recently launched a tool called Clerk that analyzes and grades briefs, evaluating their strengths and weaknesses, looking for areas of improvement and attack. Clerk’s analysis spans seven dimensions that measure how well the brief is argued, how well it is drafted, and the context within which it arises." Clerk reviewed 500 briefs from 20 BigLaw firms written for clients like Apple, Google, and Toyota. In a post that clearly pulls its punches (for obvious reasons), Judicata found:
  • Only 1 out of 500 briefs scored an A (and that was an A-)
  • Almost every brief contained misspelled case names, miscited pages, and misquotations
  • A third of the misquotations were intentionally inaccurate
  • 40% of firms misspelled their judge's name
  • Most briefs relied on precedent whose outcome supported the other side
That resonates. I'm sure I've made each error (except the intentional misquote, I hope). For me, typos is a real problem. And there only the beginning.

Every time I sit down with one of Garner's books, I feel like I am taking a guided tour through the damage I have done, and continue to do, to the English language. It is not a matter of mere polish. It is about readability and clear argumentation in service of persuasion. Our output is not nearly as impeccable as we like to think, which undermines the implicit argument we constantly make that we should be left alone to do our good work even if we are a little inefficient.

And that's us litigators. Supposedly, our transactional brethren are worse. Writes Garner, "Although lawyers in all areas of practice are affected, the incidence of the Dunning-Kruger effect is significantly higher among transactional lawyers than it is among litigators." Whether or not this observation is accurate, recent scholarship has not been kind.

Professors Choi, Gulati, and Scott have identified The Black Hole Problem in Commercial Boilerplate. In short, a "boilerplate term that is reused for decades and without reflection merely because it is part of a standard-form package of terms, can be emptied of any recoverable meaning: this creates a contractual black hole." The culprits:
The client’s assumption is that the lawyers possess the expertise to make the necessary marginal modifications to the standard forms to insure that they both fit the client’s preferences and do not depart significantly from what the market would consider the standard package. But lawyers working with standard form language repeated for many years by rote are unlikely to have much, if any, understanding of the purpose served by these terms.
In Variation in Boilerplate: Rational Design or Random Mutation?, they extend this investigation to the presumption in standard contract doctrine that "sophisticated contracting parties choose their terminology carefully because they want courts or counterparts to understand the
precise meaning they intend to convey." They find the presumption is not supported by the evidence. Rather, contract evolution is much closer to "random mutation": 
Agents charged with the drafting responsibility but ignorant of the function of the boilerplate terms tinker with the boilerplate language at the margins. But if parties include these boilerplate terms simply to satisfy standard practice and not because they attach independent substantive meaning to the terms, then principals are not motivated to monitor the agents’ actions. In this way, the revised language evolves as the “new” standard, leading to encrustation. The modified standard is then reused in future deals and incorporated into the next generation of boilerplate terms. Under a Random Mutation model, it would not be surprising to find terms that become part of the standard template and are then repeated over time through rote usage as part of the standard package of terms without any attention paid to the original meaning of the terms. This lost meaning becomes even more difficult to recover when, through the tinkering process, the terms also become encrusted with meaningless legal jargon.
In Boiling Down Boilerplate in M&A Agreements, Professors Anderson and Manns extend the analysis of black hole problems to 12,000 M&A agreements:
The problem lies in the drafting process of documents that are neither completely negotiated nor completely standardized. In such contexts, parties often recycle boilerplate provisions from precedents, a practice consistent one of the goals of standardization and the use of precedent. However, the penchant of lawyers to leave their mark on agreements through a myriad of additions and deletions to the text may come at a high price of eroding the substance of ostensibly standardized language. The interplay between mechanical recitation of boilerplate and high levels of edits is that boilerplate terms may morph into non-standardized language that loses its original meaning, even though the provisions continue to live on in agreements in increasingly fractured ways. These findings provide evidence substantiating the black hole or grey hole hypothesis of the evolution of boilerplate having a potentially corrosive effect on the textual integrity and meaning of these terms.
The mergers and acquisitions context epitomizes this problem of unreflective copying of precedent provisions combines with ad hoc edits to individual clauses. Each agreement is based on a prior deal precedent, and drafters frequently incorporate sections of the prior deal without sufficient scrutiny about the degree to which idiosyncratic novelties have been introduced in the precedent document that may be inapplicable to the new deal. At the same time, high levels of “editorial churning” take place in the process of transforming each precedent into the current acquisition agreement. The result is a problem of “drafting drift.” Boilerplate provisions live on from deal to deal, yet gradually shed their textual integrity and potentially lose their clear meaning as ad hoc edits are copied from deal to deal and new ad hoc edits are added at each stage.
Again, this critique resonates with me personally. In particular, I identify with a passage from their companion article, The Inefficient Evolution of Merger Agreements:
The absence of even firm-specific forms has led to haphazard and inconsistent lawyering as lawyers add significant amounts of extraneous information to each deal and inadvertently retain deal-specific information from prior deals. This fact underscores the inefficiency of current deal drafting processes and undercuts the argument that merger agreements are distinctively crafted (at great expense!) to suit the needs of clients.
We argue that the remarkable heterogeneity of acquisition agreements reflects lawyers’ tendency to use precedents that they are more familiar with or relate to the particular client they are dealing with, rather than those that may be more readily adapted to the transaction at hand. The result is a path dependent process of deal term evolution that thwarts standardization even within firms and leads to systematic inefficiencies in the acquisition agreement drafting process which raises costs and risk to clients.
Are we really copy-and-paste monkeys who indiscriminately tinker just to leave our mark? Explain to me why we deserve so much deference if our core products are defective.

Emphatically, the simple answer is no. We are not just copy-and-paste monkeys. The Choi et al. papers are worth reading in their entirety to understand the context-specific reasons for why the black hole problem arose with respect to pari passu clauses, including client resistance to altering long-used forms. Likewise, I recommend Why Have M&A Contracts Grown? Evidence from Twenty Years of Deals and Set In Stone? Change and Innovation in Consumer Standard-Form Contracts to balance the view of the value skilled lawyers bring to contracts.

Contract evolution is not all mindless tinkering. But the evidence is compelling that there is considerably more of that than we would probably care to admit. Which is part of the reason that being a lawyer can be the most boring job in the world.

I plead guilty to some of the charges. In BigLaw, I started as a litigator. Later in my career, transactions became a significant part of my brief. So I did what I do. I standardized and automated. It did not occur to me that I might be standardizing garbage.

A Tale of Templates

According to some sources I read, lawyers need to disrupt themselves by applying design thinking to automated workflows that utilize machine learning and distributed ledgers to create smart contracts between devices on the IoT. But most lawyers have never gotten beyond bare survival with Word and have proven almost constitutionally incapable of follow through on simple systems that utilize templates.

With consulting and site visits, I've had the opportunity to review how lawyers work across several dozen organizations (in-house, law firms, government). I find that most lawyers generate a substantial percentage of their work product by opening the last similar document they encountered and editing salient information. The original provenance of the document is unknown, but our lawyer usually acquired it from a lawyer down the hall or a haphazard search of the organization's document management system. This, of course, was precisely what I did when I was a junior lawyer long ago. Though maybe the world has changed since my last site visit in December 2017.

This ad hocism is suboptimal for the reasons I laid out here and in the papers cited above.
When I ask the lawyers why they don't use standard templates, they respond that no templates exist or the ones that do are outdated. When I mention this to the people in charge, they are incredulous because the organization invested in templates ages ago and everyone uses them. The conflicting accounts are resolved by a chief administrator who explains the templates were created but few people used them so most templates have fallen into disrepair and disregard.
ASIDE: I repeat myself. I repeat myself. I feel like I constantly tell the same story. Relatively straightforward solution to obvious, ubiquitous problem. Something is done but doesn't stick or radically underperforms because of adoption issues—training, process redesign, discipline, enforcement. People at the top are satisfied that the problem is solved and move on. Problem persists and is rediscovered five years later. Cycle repeats.
I am convinced that legal productivity could have been increased substantially decades ago by broader, better use of training, templates, document automation, and electronic signatures. I am convinced that legal productivity could be increased substantially today by broader, better use of training, templates, document automation, and electronic signatures. That is a sad commentary. Low-hanging fruit was obvious then. It is even more obvious now. Yet the dysfunction remains.

These are not idle observations. I've enforced template usage and quality control protocols to the point where junior lawyers have been removed from accounts for failure to comply. I've also overseen contract automation processes that ultimately paid huge dividends.

On one project, I used a law company to employ a veteran contracts lawyer who was able to substitute for a substantial chunk of what outside counsel was doing at less than one-third the cost. The lawyer split time between work previously sent to outside counsel and the contract standardization/automation project. The project had a positive ROI from day one and realized substantial benefits and savings upon completion.

There was, however, one problem. The lawyer kept coming to me with questions about how to resolve variations and conflicts in the existing documents. I had no answers for him because I had never thought critically about the content. I had simply accepted the inherited documents. In fact, there was a wealth of good material. But the overall coherence and consistency had been degraded over time by editorial churning and drafting drift.

I was fortunate. This experienced lawyer knew exactly where to turn. He introduced me to the writings of Ken Adams.

Adams on Contract Drafting

Looking back, we should have consulted with Ken directly. I had reasons not to, but these were not good reasons. We consulted MSCD and Ken's blog. Though "we" gives me too much credit. The contracts lawyer was the true Ken disciple. I benefited from his dedication and curation. It is one of many instances in my career where I have been good only because I was fortunate to be surrounded by good people.

In discovering Ken, I uncovered just how little I had  considered what contracts do—regulate conduct, state facts, and allocate risk—let alone how they should be constructed. I could offer the excuse that I was born a litigator. But that, of course, would conveniently ignore the starring role contracts play in commercial litigation.

It was not the first time I was struck by own ignorance. I'm not sure how anyone graduates law school without feeling totally unprepared to be a lawyer. I don't know how any seasoned lawyer makes it through a party or family gathering—fielding questions about DUIs, divorce, taxes, estate planning, and executive privilege—without realizing that the world thinks you know far more than you do. For me, impostor syndrome never goes away, the volume simply gets turned down gradually in discrete areas where I have spent time to become educated. Before Ken, contracts had not been one of those discrete areas. And then Ken cranked the volume up to eleven.

Ken is the kind of nerd who will write 27 pages about the phrase "represents and warrants" being pointless and confusing. MSCD is his nerd magnum opus. Ken also possesses one of those nimble minds that makes it immediately apparent that he has considered whatever counterargument you may inclined to raise and found it wanting. He has put in the work required to have an opinion. He is a true expert, and he knows it.

While becoming painfully aware of one's own ignorance, reading Ken also makes it hard to escape the conclusion—supported by the empirical evidence from the scholarship above—that true contract drafting experts are few and far between.

When I first read Ken's observation that we need "contract drafting specialists," I was incredulous. I thought we already had armies of them. But, apparently, we have deal lawyers. Their emphasis is not on contracts but on getting deals done. Contracts are simply a malleable means to that end. Hence, our expensive and risky black hole problem.

As far as I can tell, Ken is in a class by himself among gurus on how to say what needs to be said in a contract (he points to others, like Glenn West, on the what-to-say part). What makes Ken relatively unique among prominent legal bloggers (including me) is his willingness to name names in rendering harsh critiques.

Much has been made of Ken's dismissal of legal forms from "hack vendors" as "crap," "dreck," and "commoditized mediocrity." But, as I argued here, I think we miss the point if we presume Ken is making the common argument that forms can't compare to bespoke lawyering. If anything, Ken is making an argument in favor of vendors under current operating conditions. Ken is not saying their forms aren't as good as most lawyers. Rather, their forms are just as bad as most lawyers, some of whose work product is far worse than the forms. That is, "the quality failure of the consumer market is just part of the quality failure of contract drafting as a whole."

Ken does not shy away from going after the lawyers themselves. He reviewed Citibank's attempt at a "new, clean design with simple language" and remarked, "It's as if they went halfway and stopped." He lamented the "naiveté" of the GC from GE Aviation whose thoughts on contracting got published in Harvard Business Review. He referred to an award-winning IBM contract as the work of "dilettantes." He chided Kirkland for recommending a clause that "serves no useful function."

Ken labeled the Google-Motorola merger agreement "a mediocre piece of drafting" and then pre-empted the inevitable objection:
"Mediocre? How can that be! After all, Google is represented by the prominent law firm Cleary Gottlieb—presumably they did the bulk of the drafting. Well, the Google–Motorola merger agreement is mediocre because all big-time M&A drafting is mediocre." 
As for our classy friends across the pond, he writes, "If you’re at a Magic Circle law firm and you think your contract prose is fine just as it is, that’s likely because it has never been subjected to serious scrutiny."

Ken pulls no punches. He proudly coined the term "copy-and-paste monkeys" He has been at this for more than twenty years. He's pointed out what we do wrong and explained in astonishing detail how we can do better. Yet there is scant evidence of the big names responding to Ken on the merits. And there is scant evidence of them changing their behavior based on his advice. Challenged on the quality of one of its core deliverables, the reaction of the legal market has been mostly ¯\_(ツ)_/¯.

The Cassandra Complex

Ken is extremely successful in the local sense. He is 'the name' in contract drafting. He gives seminars all over the world. MSCD is an essential reference with impressive sales now in its Fourth Edition.

But Ken is still fighting a battle he started more than two decades ago. He set out to address dysfunction in contract drafting. Dysfunction remains. Isn't that failure? Ken answered that very question on his blog. His answer is not precisely how I would respond. His answer is better:
I’ve always known that because contract drafting is a precedent-driven part of a notoriously conservative profession, measurable change would take time. I’ve been satisfied to have my stuff be of use to those of us who want clearer contracts...the defining characteristic of the current system is that it’s resistant to change. Contracts are drafted by copy-and-pasting, on faith, from templates and precedent contracts of questionable quality and relevance. Given inertia, the pace of transactional practice, and structural impediments to change, it’s enormously challenging for law firms and company law departments to stop the whirring machinery, dismantle it, retool it, and put it back together.
Change is so hard to come by that sweeping change will require overhauling the entire contract-drafting apparatus. MSCD is just the first step—the foundation. Next, we need a subscription library of automated templates; a certification program; and an online contract-drafting course for law schools.
We’ll see how much of that comes to pass. But even if you assume that none of it does, and that drafting consistent with MSCD’s guidelines is limited to an enlightened minority, that still wouldn’t mean that MSCD had failed.
This attitude merits emulation. I know I'm fighting the good fight. But it's trench warfare. Progress is measured in inches. I am keen on any technological advancement, tactical innovation, or strategic shift that might fundamentally alter the dynamic. When do we start capturing huge chunks of territory? I remain hopeful that the answer is soon. But I'm not counting on it and intend to keep fighting anyway.

I'm prepared to be patient. But I sometimes worry about being too conciliatory. I've long had sympathy for the argument that talent trumps system. My counter remains that system amplifies talent. But in taking the primacy of talent as a given, I wonder if I am crediting the core conceit that what lawyers do is so consistently valuable that we are entitled to some sort of dispensation for our sins. We're not. Our output is not that consistently good. We're not doing the best we can. We know better. We should do better.

______________________________________
D. Casey Flaherty is a legal operations consultant and the founder of Procertas. He serves on the advisory board of Nextlaw Labs. He is the author of Unless You Ask: A Guide for Law Departments to Get More from External Relationships, written and published in partnership with the ACC Legal Operations Section, and the Service Delivery Review Primer, written for the Buying Legal Council. Find more of his writing here. Connect with Casey on Twitter and LinkedIn. Or email casey@procertas.com.

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1/25/18

When women push back on stereotypes in marketing and advertising

By Lisa Salazar (@Lihsa)


A UK study, Elastic Generation: The Female Edit, offers some refreshing insight into a woman's perspective on advertising.

Conducted by J Walter Thompson Intelligence, 248 UK women aged 53-72 were surveyed. For comparison,  276 UK men were surveyed, as well.

When women push back on patronizing and stereotypes in marketing and advertising

Marketing to women

Identifying this group of females as the "elastic generation", the report comes to this pivotal conclusion:
The two words women choose to describe advertising aimed at them? ‘Patronising’ and ‘stereotyped’. As a result, 72% say they pay no heed to advertising. Nine out of ten say they would just like to be treated as a person, not a stereotype. Elastic Generation, p. 3.
I would surmise that this general feeling floats all the way across the pond.

Women's buying power

Today's women are more independent than ever, with as much, if not more buying power than their male spouses, partners and exes.

As the world is roughly fifty percent women,  this is an obvious missed opportunity by marketers. And in legal marketing, 36% of US lawyers are female. American Bar Association, "A Current Glance of Women in the Law," 2017, p. 2.

In fact, UK's Office for National Statistics reports that members of the Elastic Generation are the top spenders in food, clothing, household goods and services, new cars; travel and dining. And for legal marketing purposes, let's throw in legal services as 25% of Fortune 500 GCs are female.

Again, I would suggest that this carries all the way over to the US.


Understand women's real buying interests

Women's interests are not limited to spa days, fashion shows and cooking classes--not that most women wouldn't turn these invitations down. But women have much broader interests than this.

No one, men or women, like to be pigeon-holed into pre-defined categories.

As a woman who loves the law, who loves tech, and with a broad array of interests, I want marketers to respect my choices. When my choices are respected, that's when I start paying attention.

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