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Cutting costs with smart use of technology

Mon, Aug 18th 2008 12:00 am
Traditionally, August is well-known to the media as the slowest news month of the entire year. Congress is in recess, prime-time television is in reruns, and many Americans use the latter half of the summer to cash in their hard-earned vacation time.

Chances are, however, that if you are a lawyer working at a firm, that at least a few billable hours will weasel their way into your vacation time due to the presence of a portable e-mail device such as a BlackBerry.

By allowing lawyers to bill those few hours and stay on top of issues while ostensibly on vacation, smart phones and personal digital assistants likely pay for themselves in just that vacation time, and only add value throughout the rest of the year.

While so many people in the legal world have come to value technology for efficiency and the coolness factor, incorporating Internet technology may also benefit something that keeps the managing partner up at night - the bottom line.

Signs of the times

Make no mistake about it, the law is a business where profit margins matter. In case you haven't heard, bean counting is becoming ever more important these days since it seems the national economy is experiencing a bit of a downturn.

The profession of law is not immune to symptoms of a slowed business environment - a number of the largest firms in the country have been forced into layoffs or truncated programs for summer associates, and are extending increasingly limited offers to law students and laterals.

While the decision-makers at any law firm may cringe at the initial cost of items such as BlackBerries for each attorney or the price of an online subscription to legal databases, the money they may save in the end - and the additional hours such technology will allow lawyers to bill - help keep firm financials in the black.

Law firms in smaller markets such as Western New York have been slower to adapt to some of the research technology and gadgetry that has become compulsory in the uber-firms, where they hand out BlackBerries and laptops like penny candy. This is understandable, as the initial investment of certain online subscriptions and portable e-mail devices can be significant.

However, in the long run, such investments can pay out via increased billable hours and more efficient researching. Smaller firms looking to cut costs may find that a down payment on certain technology will lead to lower amortized costs throughout the year.

In this summer (and probably this fall and winter) of our economic discontent, law firms should consider some other simple ways that technology may benefit the bottom line.

Travel/availability expenses

According to an article published in July in the New York Times, enrollment in online classes at many colleges and universities is up as much as 40 percent. The reason? The soaring cost of gas. With the price of keeping the car fueled skyrocketing, many students are opting to learn via online classes - something that's not as novel or as difficult as it once seemed since online videos, wikis and blogs allow classmates and teachers to stay constantly engaged and in contact.

Law firms can easily implement the same ideas for communication among offices in different cities or parts of an area, or even communication with clients. Communication technology is not just relevant for law firms that have offices overseas or across the country. A number of Buffalo-area law firms maintain offices in Rochester, Syracuse, Albany and other areas of New York and Southern Ontario. Realistically, driving to one of those offices for a meeting or other activity at the firm's own cost does not seem like that much money or effort - that is until gas started to hover around the $4-a-gallon mark.

Staying in touch with out-of-town offices and clients is not just a matter of e-mailing back and forth. Webcams make for easy "face time." Interoffice wikis allow a number of people to contribute to the same project. Moreover, sometimes working online between offices can cut down on supply and postal costs. It is no secret that law firms are not always the environment's best friend, as offices print out reams of paper each day. Working online can cut down on the need for hard copies (though admittedly, in the law there are often times when there is no way around hard copies) and can save on often overlooked postage costs.

Much like the cost of gas, postal prices are consistently on the rise. Attaching documents instead of sending printouts, making use of courts' e-filing options and sending out e-alerts and newsletters from the marketing department are all ways that use of the Internet's most basic features can help a firm save some cash.

Research

According to a recent study, use of Internet search engines is about to surpass use of e-mail as the most popular office Internet activity. Though there are certainly exceptions when books are necessary, most of the information lawyers need on a daily basis can be found using an Internet connection.

This is not as simple for some firms as it is for others; the extremely high cost of subscriptions to standard legal databases such as LexisNexis and Westlaw are often prohibitive for small firms and individual practitioners. However, information via the Internet can help cut costs in other ways.

Law firms and individual lawyers should assess what newspapers and journals they subscribe to and receive each week or month. Although some publications do require a paid subscription to view content online, there are just as many that offer what you are paying for in hard copy for free on the screen. Take the time to go through and find out what you are paying for that you don't have to; however, make sure that a publication's Web site archives their material so that the information remains available. As an added benefit, it will cut down on clutter and open up storage space.

Billing practices

One of the issues often addressed in this space is the generational divide among lawyers when it comes to technological issues. Newer and incoming attorneys often use the Internet far more than more-senior attorneys. Moreover, they use it in way that is not a learned activity, but natural to them, as they have never known a world without the Internet and computers.

Simply put, there are some younger associates who will use this technological chasm to their advantage when it comes to billing. A research task that a partner may think will take two hours in actuality may take a mere two minutes using Google. There are those who will bill the hours of expected research, not the actual time it took, knowing full well that the assigning partner does not know the difference.

This does not mean that all "Googling" or Internet research is quick and easy or that associates are out to take advantage. Many times, well-done, well-sourced research on the Internet can take a great deal of time. Regardless, billing attorneys should make themselves more aware of how long certain tasks will take on the Internet to make sure the appropriate amount of time is billed. It is in the best interest of the relationship with the client and the bottom line.

Lawyer and freelance writer Caroline Bala Brancatella can be reached at cbb9980@gmail.com.