How the Persistent Disconnect Between IT and Legal Will Be Fixed

Last Wednesday, Recommind announced the results from its 2nd annual IT/legal survey. They were, in a word, disappointing, as the results showed that the cooperation and collaboration between these two critical groups has actually worsened in 2010 after largely improving in previous years. A few of the survey’s “low lights” include the following:

In 2009, 67% of respondents described the relationship between the two departments as “good” or “very good”; in 2010, that number has dropped to 54%
In 2009, 37% of respondents reported that IT and legal were working more closely together than the year before; that number has dropped to 27% in 2010
In 2009, 40% of respondents stated that their IT department considered eDiscovery to be a “high” to “very high” priority; in 2010, that number has dropped to 26%
In 2009, 82% of respondents said that legal was “very involved” in eDiscovery technology purchasing decisions 48% of the time; in 2010, legal’s involvement has dropped dramatically, decreasing from 48% to 33%
72% of respondents report that their IT and legal teams meet once a quarter or less; 52% meet once a year or less and 23% never meet at all
When it comes to actually implementing eDiscovery processes, the focus of each department is also quite different: the primary goal of the IT department is “executing as quickly as possible” (35%), while the primary goal of the legal department is “complying with federal regulations and court orders” (61%)

The majority of the people we have spoken with in the past few days have had similar reactions to this data, namely a mix of frustration and bewilderment. Most assumed that the IT/legal relationship would keep improving as eDiscovery kept its high profile and IT budgets returned. But the simple answer is that this has not happened; as these survey results clearly show, while the Pfizers, JP Morgans and Marathon Oils of the world may have an effective IT/legal response to eDiscovery, they represent the leading edge that is now far ahead of most other companies. The majority of companies who comprise the mainstream simply haven’t gotten there yet.

It might be tempting to blame these results solely on continued economic weakness, which is undoubtedly impacting things to some extent but can’t completely explain this phenomenon. Based on our knowledge of the market and in speaking with countless enterprises and – just as importantly – their “go to” outside counsel, here are several reasons why we believe the IT/legal relationship has a ways to go before it can be considered healthy:

Initial “Band Aids” did not work. As eDiscovery became more expensive in 2007, 2008 and 2009, all but the largest enterprises took one of two approaches: they either did nothing, hoping the problem would go away, or they deployed stop-gap measures (e.g. simplistic pizza box appliances to cull post-collection data) that achieved limited short-term cost reduction. But the problem is that these point solutions addressed only a symptom of the problem (too much data being collected), the benefits from which were quickly eclipsed by the relentless growth of enterprise data. Within a year or two, these Band Aids were no longer effective – which put IT and legal at odds with each other yet again, as IT’s “solution” isn’t meeting and can’t meet legal’s needs.

Failure to address eDiscovery’s issues at their root cause. Most enterprises, including many of the largest, still haven’t addressed the primary cost driver of any eDiscovery and regulatory compliance event: uncontrolled enterprise information growth, too much of which is being preserved, collected and sent to outside counsel or third parties to cull/process/review/produce. Until this happens, legal will likely continue to view IT as part of the problem and not part of the solution.

Lack of executive buy-in. As opposed to serial litigants – like Fortune 100 companies in the pharma, energy and financial spaces – most executives at mainstream companies do not think about eDiscovery very often as they are focused on their day jobs. Unless these companies are a) in a particularly exposed industry (e.g. private equity, healthcare, etc.) or b) are hit with a relatively high profile lawsuit or investigation, they tend to look at eDiscovery as something that should be deferred. This attitude is then reflected by the IT team, who focus more on their traditional duties of communication systems, data centers, storage, and network security.

How might this situation be fixed? Simply put, eDiscovery must “go mainstream” by having companies outside of the heavily regulated and/or litigious segment implement processes and systems which will allow them to effectively manage eDiscovery and regulatory events for the long term. Enterprises of all sizes must do a better job of managing, classifying and remediating enterprise content, approaching eDiscovery as a systematic IT process (like document management, records management or storage optimization), and deploying more repeatable and powerful processes and solutions. Far from the “flash in the pan” many had hoped eDiscovery would be, much like records management and regulatory compliance eDiscovery is here to stay. Legal and IT need to recognize this fact and work together to address these issues with a long term approach.

The good news is that this is already happening; at Recommind, we’ve seen an explosion in projects spanning the length of the EDRM process, but especially in 1) sophisticated analytics and computer-expedited review (i.e. Predictive Analytics™ and Predictive Coding™), 2) targeted preservation/collection (as opposed to the forensic imaging approach still widely used today – mostly in non-forensic situations), and 3) content classification and remediation. What’s driving these projects amongst more mainstream customers? A combination of factors, including the continued uncontrolled growth of eDiscovery spend – which leads to executive ownership and buy-in (whether they like it or not), more end-to-end solutions (which move beyond the pizza box, point solution approach), and more integration of eDiscovery capabilities with core IT infrastructure (like document management systems).

Recommind’s 2010 IT/legal survey results signal that we’re not out of the woods yet, while also laying bare the fallacy that mainstream companies have eDiscovery under control. Based on current projects, however, it would seem that many of these same companies have awakened to this fact – and are doing something to improve the situation. We are bullish that the second half of 2010 will show significant progress on this front.

Posted by: Craig Carpenter on June 22, 2010, 5:00 pm | Permalink | Trackback