While I was in Seattle at the 2013 AALL Conference, I had a chance to listen to, and briefly talk to Casey Flaherty of Kia Motors America, Inc. As many of you have read recently, Casey is making waves by giving his outside counsel some basic skills tests on how long it takes them to update contract language via MS Word, print to Adobe Acrobat, and resorting MS Excel lists. His testing of ten outside law firms associates (9 total firms and 1 took it twice) came back with all ten failing his technology competency audit.
He gives one example in most of his talks where an additional indented sentence is added into a contract. He shows the crowd what should take about 12 seconds to do (if the attorney is tech savvy and understands form automation tools), usually takes about 10 minutes for most attorneys to complete because they are manually updating paragraph numbers and reformatting the document piece by piece.
Now, the question I presented to him was this:
Why should the associate be the one doing the word processing updates in the first place?
Shouldn’t those tasks be assigned to Secretaries or WP Staff members who:
1. know how to use the resources effectively and
2. are either billed at a much lower rate or aren’t billed at all?
His answer was a bit simplistic, but typical of today’s corporate counsel expectations (I am completely paraphrasing his response):
Technology is so entrenched in the day to day operations of the associate, that it is expected that they have (or should have) the skills to complete these simple tasks so quickly that it doesn’t make sense to outsource it to a secretary or Word Processing Department.
Implied in that paraphrased answer was the idea that even if it went to WP, the lawyer would still review it (and charge for his or her time), so why add in an extra layer of work to do such a simple task that the lawyer should know how to do already.
Here’s a couple of observations that I walked away from Flaherty’s talk:
- Flaherty is either going to be a hero or a goat for discussing this and calling out his outside counsel for having such poor tech skills, and that his ‘tech audit’ is simply the beginning (he is also asking for access to daily time entry by firms so he can find associates that are billing .3 hours to 10 different matters each day, or those that enter time in weeks after the work was actually performed.)
- The basic message that Flaherty is giving is that:
a. Corporate Counsel simply have lost trust in the firms they hire (this is the biggie!!)
b. Poor skills equal higher costs billed to the clients
c. Firms that bill by the hour have no incentive to improve these skills
d. Clients will need to be the drivers to improve the skills required of their outside counsel
e. Clients will either need to negotiate alternative fee arrangements with outside counsel, or
f. Clients will need to assess skills and decrease fees for those firms that fail these skill tests
g. Clients will need to monitor firms more closely, and even require firms to disclose processes used (such as up-to-the-day time entry exposure on all of the client’s work) and force changes that are deemed, by the client, to be inefficient.
- There are ‘opportunities’ for firms as well:
a. Firms that work on tech skills and pass the audit can use that PR to use as an advantage over other firmsb. Firms willing to take the temperature of their clients on what technology skills they want their outside counsel to have can use this a leverage within the firm to improve the skills that are important to the client
c. Firms that have internal discussion can motivate the law firm leadership (both on the Attorney side and on the Administrative side) to evaluate basic skills needed on products that attorneys use on behalf of the client. It could start by asking simple questions like:i. Can an attorney print from Word to PDF?
ii. Can an attorney resort information in an Excel spreadsheet?
iii. Can an attorney update a basic form using the automation resources found in MS Word?
iv. Are there customized resources we have within the firm that already improve the time it takes attorneys to do basic tasks (and are we telling our clients about these resources?)
v. Is our work flow set up to take advantage of the professional staff we have to either push these tasks to the appropriate level, or leverage the skills of the staff to train the attorneys on simple tasks that can save enormous amounts of time?
All in all, what Flaherty is doing is an attempt to dictate the minimum skill level that his outside counsel has and decrease the costs to his company by requiring those improved skills, or punishing firms when they lack those skills (usually through a flat across the board fee discount.)
It should be interesting to see how much more traction Flaherty gets, and how soon it will be before a third-party snatches him up and he becomes a consultant for other companies to improve tech skills for their outside counsel.