Opportunity Cindy Diamond PENTA Advisory Services for GREATER LAW FIRM EFFICIENCY Baltimore, Md

INSIDE THIS ISSUE

Keeping in Touch with Technology— Videoconferencing page 4 Book Review: From Gutenberg to the Global Information Infrastructure page 5 Disaster Planning for Data Security page 6 Practice Innovator Tom Dyer, H&K Consulting, Inc. page 8 Industry Innovations: Practice Statistics of Note page 10

PRACTICEPRACTICEVolume 3, Number 1, March 2002

Editors in Chief Austin Doherty INNOVATIONSMANAGING IN A CHANGING LEGAL ENVIRONMENT Hogan & Hartson L.L.P. Washington, D.C. William P. Scarbrough Kirkland & Ellis London ECONOMIC SLOWDOWN AS Editorial Board Members Janet Accardo Skadden, Arps, Slate, Meagher & Flom L.L.P. New York, N.Y. opportunity Cindy Diamond PENTA Advisory Services for GREATER LAW FIRM EFFICIENCY Baltimore, Md. John Hokkanen Latham & Watkins A conversation between Bradford W. Hildebrandt (chairman of Hildebrandt International, a Los Angeles, Calif. consulting firm to the legal profession) and William P.Scarbrough (Practice Innovations co-editor) Kingsley Martin West Group Advisory Board Member Chicago, Ill. SCARBROUGH The economic slowdown that has occurred in the United States over Nina Platt the past year or so has begun to affect the legal industry. Several major law firms Faegre & Benson L.L.P. have recently announced attorney and staff reductions. How is the current Minneapolis, Minn. economic climate similar to the recession we experienced during the early Al Podboy Baker & Hostetler 1990s? How is it different? Cleveland, Ohio HILDEBRANDT There are a number of differences between the current economic Barbara Sessions Winston & Strawn climate and the recession we experienced 10 years ago. In the early ’90s, the Chicago, Ill. Federal Reserve Bank was slow to adjust interest rates, the real estate market was Linda Will Brad poor, the bond market was weak, and the federal government and many state Greenberg Traurig L.L.P. Hildebrandt and local jurisdictions increased taxes. Today, the Fed has been Miami, Fla. cont’d on p2

COMMUNICATING BEST PRACTICES AND INNOVATIONS IN LAW FIRM INFORMATION AND KNOWLEDGE MANAGEMENT TO LEGAL PROFESSIONALS Economic Slowdown as Opportunity

cont’d from p1 quick to act in response to changing economic conditions, the real estate market has remained strong, the bond market is robust, and tax cuts have been enacted (with the possibility of more to come). I believe that the legal industry can glean some important lessons from the previous recession: • Associate layoffs went too far, fostered by knee-jerk reactions in an effort to protect partner earnings. This problem was exacerbated by the profession’s reliance on profitability figures contained in various public surveys, the accuracy of which was questionable. Bad business decisions were made based on this questionable information. It also fostered a greed mentality on the part of many partners, who failed to understand the importance of investment in the future of their firms. • Firms carelessly reduced their marketing efforts. • Cost cutting also went too far. Careless cutting of expenses that had a negligible effect on earnings and a huge negative effect on morale was a serious problem. “Technology • Firms lost sight of their long-term focus. is so much a part of the practice of law that • Firms that emphasized cost firms have to continue to make investments.” reduction in nonlegal staff recovered faster than did firms that emphasized cost reduction in their legal staff. because change was advantageous to neither the buyer nor SCARBROUGH One consequence of the recession of the early the seller. Nevertheless, traditional firms are now doing a 1990s within the legal industry was greater scrutiny by little more contingency or quasi-contingency work, where a clients of law firm bills and billing practices. There was part of the fee is tied to the attainment of certain results. significant movement away from the “billable hour” SCARBROUGH Opponents of the time and disbursement approach in favor of various “special fee arrangements.” approach to client billing have argued that it encourages law New standards emerged from the American Bar firm inefficiency, or at least fails to reward law firm efficiency Association and the American Corporate Counsel and business innovation. Do you agree with that argument? Association regarding coding, categorizing, and tracking lawyer time and expenses to allow apples-to-apples HILDEBRANDT That is an overstatement, based on a false comparisons across firms. The movement seemed to lose assumption that law firms are run inefficiently. In fact, momentum as the economy picked up again. Despite the they are far more efficient than they were 10 years ago, existence of alternative fee arrangements for particular partly because they learned some important lessons from matters or clients, it seems to me that most law firms still their experiences during the last recession. Moreover, both bill most of their clients on a time and disbursement basis. firms and clients have become much more sophisticated. Do you have that same impression? If so, what has In the end, the best relationships are built on trust, happened to the often-predicted demise of the billable cooperation, and the concept of partnership between the hour? Is the billable hour in danger? firm and its clients. HILDEBRANDT All the talk about the death of the billable hour SCARBROUGH During times of economic uncertainty, law was really much ado about nothing. During the previous firms (and other businesses, for that matter) tend to invest recession, there was tremendous discussion about less money in “bricks and mortar” capital such as alternative billing arrangements. Some alternatives were technology infrastructure. Law firms view themselves actually implemented, but the reality is that most of the essentially as cash businesses, so reducing expenses is a alternatives amounted to fixed-fee arrangements. The fact logical way to conserve cash and enhance profitability. is that most clients are as conservative as law firms are Could the current economic environment be a good time when it comes to fee arrangements. When push comes to for law firms to use technology to enhance efficiency, shove, general counsel tend to want to stick to the billable productivity, and their competitive edge? If so, how should hour. Frankly, the move to alternatives lost momentum firms invest their technology capital right now?

2 HILDEBRANDT Law firms, like other businesses, use economic downturns to slow down capital investment. That is probably prudent. But technology is so much a part of the practice of law that firms have to continue to make investments. One particularly smart Several U.S. firms have investment is in knowledge management, a concept that developed knowledge-based online gets a lot of attention within law firms but questionable legal advisory services. For example, Bryan implementation. We believe that for most law firms, their Cave [Bryan Cave LLP] has its Trade Zone, a investment in technology currently far exceeds their service focusing on international trade transactions. Davis lawyers’ ability to use it. Polk has its Global Collateral System, which focuses on SCARBROUGH There have been many articles published cross-border financing. Both systems allow clients to enter during the past several years on the topic of knowledge information about a specific transaction and receive an management in the legal industry. Do you know of any law immediate initial opinion. Trade Zone provides a concise firms that have truly seized control of their institutional red-light/green-light response while the Global Collateral knowledge and enhanced their client work product while System offers legal analysis. U.S. firms generally use a also reducing client expense and product delivery time? This subscription-based revenue model for these systems. They seems to be the Holy Grail of knowledge management. provide the added benefit of driving additional services under traditional hourly billing rates when lawyers are HILDEBRANDT Law firms in the United Kingdom–especially pulled in to advise on potentially problematic transactions. the so-called magic circle of leading U.K. firms–are widely regarded as being substantially ahead of U.S. firms in the Bryan Cave has also developed another interesting area of knowledge management. In the United States, only knowledge-based system called the No Zone. The No Zone a handful of firms have made significant strides in delivers sexual harassment training online to supervisors effective implementation of knowledge management. and managers. It uses a contractual revenue model based Frequently cited examples include Brobeck [Brobeck, Phleger on the number of participants in an organization. It was & Harrison LLP], Davis Polk [Davis Polk & Wardwell], and created to help general counsel reduce their spending on Simpson Thacher [Simpson Thacher & Bartlett]. These outside counsel by reducing the number of harassment firms have built sophisticated “know how” systems that suits. It has created entirely new revenue streams for Bryan allow them to quickly deliver high-quality transaction Cave. Since it is product-based rather than service-based, it documents while maintaining high profit margins. generates revenue while the lawyers sleep. cont’d on p4 BY DEREK LEA ILLUSTRATION

3 Economic Slowdown as Opportunity

cont’d from p3 SCARBROUGH What about the areas of Portals are much more problematic today. They offer the system integration and work flow? During the past few promise of substantial improvements over intranets; years there have been numerous presentations at legal however, portals require that firms make substantial technology conferences about the sophisticated intranets investments in technology and that they think hard about and portals used by some law firms. Have these what information and resources they want to deliver to investments paid off? Are you aware of law firms that have specific lawyer and staff populations. To date, only a small truly leveraged this technology to enhance law practice and number of firms have built sophisticated portals to succeed business management productivity and efficiency? their intranets. While some will say anecdotally that their efforts have been rewarded, they have not attempted a HILDEBRANDT There is no doubt that law firms have derived formal analysis of return on investment. And a number of significant advantages from their intranets. Successful other firms report dissatisfaction with their initial portal intranets capture large amounts of information and deliver it efforts and are reevaluating their adoption of this electronically through the organization, reducing paper and technology. providing everyone with up-to-date information. Many firms have also built special Web-based applications such as firm SCARBROUGH Thank you for your insightful comments and directories and meeting-room reservation services. Firms that ideas. Because you are a highly respected consultant to the have moved to a practice group orientation often use the intranet legal industry, it is encouraging to hear your optimism to share information and resources among the group members, regarding the relative position of large law firms in the such as descriptions of group policies and procedures, form current economic slowdown and the legal industry’s documents, work product, and links to useful Web sites. improving focus on, and use of, technology.

KEEPING IN TOUCH WITH TECHNOLOGY Videoconferencing BY ROBERT ROEMER JR., SHAW PITTMAN L.L.P., AND ELISE BELLICINI, HOGAN & HARTSON L.L.P.

that don’t want to invest in such a videoconferencing over Web-based room can use a “room broker” conferencing is that the connection service to rent videoconferencing can be made less susceptible to facilities. Room broker services are disruption. available in major cities around the As the hardware and transmission world. Most A/V firms that service the legal and business professions communication costs decrease, can assist you in finding a suitable videoconferencing has started to match for your firm’s video- become more widespread in the legal conferencing needs. community. The cost of a particular he legal community is increasingly videoconference depends on several As with other new technologies, there using videoconferencing to connect variables, including the vendors T is more (and less) to video- far-flung, busy clients and law firm involved, the bandwidth connection, conferencing than meets the eye. For personnel. Though not without its and the locations of the participants. example, you cannot take it for challenges and limitations, video- Videoconferencing sessions can cost granted that the videoconferencing conferencing can be an effective, cost- as little as $60 per hour or as much as equipment at one location can be efficient, and timesaving way to meet $500 per hour. integrated with different equipment (virtually) face-to-face over a private, at another location. A/V specialists Whether you are trying to reduce the secured connection. recommend testing the connection expense and inconvenience of travel In order to implement video- prior to a meeting. They also suggest or simply trying to find a more conferencing services, a dedicated room “bridging” the lines, an option that robust way to stay in touch with must be set up with the appropriate will reroute a dropped line to avoid distant clients and colleagues, computer hardware, software, and connection failures and blips during videoconferencing technology can audio/video (A/V) equipment. Firms the meeting. One advantage of accommodate your needs.

4 BOOK REVIEW

From Gutenberg to the Global Information Infrastructure: Access to Information in the Networked World

by Christine L. Borgman

REVIEWED BY JOHN E. DUVALL HOGAN & HARTSON L.L.P.

his is a book about the Global nondigital media. The fact that digitized surro- T Information Infrastructure (GII), gates of originals can be easily duplicated, which is something that does not currently exist and that manipulated, and transmitted makes digital we do not yet know how to build. The GII is to be a con- information well suited for some purposes. stellation of all the world’s telecommunication and com- There are other purposes for which only a puter networks, a super-network that will support every nondigital object will do. Hybrid libraries will information and communication application. The hoped- develop as digital technologies supplement— for benefits seem utopian: global cooperation; individual but do not replace—traditional forms. empowerment; ever more productive labor; and open com- Like other libraries, digital libraries use metada- John Duvall petition in international markets. ta to administer resources, organize informa- Some commentators predict that the GII will have a revo- tion, and systematize access. Metadata is data about data. lutionary and discontinuous impact, sweeping away the Its core function is to describe documents. A familiar print publishing industry and its supporting organiza- example of metadata is the catalog record that serves as a tions, including libraries. Others anticipate an evolutionary surrogate for the book it describes. and continuous process wherein the GII supplements, Today, many digital libraries are difficult to use. The vari- rather than supplants, the existing information infrastruc- ety and complexity of their functions, applications, and ture. Christine Borgman argues for a third scenario that user communities often obscure the relationship between she terms co-evolutionary. tools and tasks. For example, an interface that is usable for Digital, Hybrid, the expert or specialist may bewilder the general user. and Traditional Libraries Similarly, an application that meets the needs of the local community may be inappropriate for a national or inter- Digital libraries are likely to be one of the key components national community of users. The next generation of digi- of the GII. The term digital libraries is not well defined. It tal libraries will serve an even larger and more diverse is sometimes used to describe databases of rich content community and manage ever larger and more diverse col- along with tools to manipulate that content. In other con- lections of resources. Design trends are focusing on mak- texts, the term refers to organizations or institutions that ing digital libraries easier to use. have attributes of traditional libraries (e.g., staff, communities of users) and provide information resources in digi- Borgman reminds us that we need not choose between tal form. libraries and computer networks. Instead, we need to decide what to do about access to information. Some library Like all libraries, digital libraries operate not on knowledge practices, such as shared cataloging, already form “the itself but on embodiments of knowledge—i.e., documents underpinnings of a ‘global virtual library collection.’” These or other objects. Some embodiments of knowledge are practices, although designed for print cont’d on p12 “born digital”; others are digitized copies of originals in

5 BY CINDY DIAMOND PENTA ADVISORY SERVICES DISASTER PLANNING

will be forever haunted by a particular photograph taken restored to all lawyers by the morning of September 13.4 shortly after the World Trade Center towers collapsed. I Remarkably, all Sidley personnel in New York City were able The photo shows Liberty Plaza Park in New York City, to report for work just six days after the firm’s downtown across the street from ground zero, covered with fallen office was completely destroyed. Similarly, American trees, shards of steel, and a thick, uniform coating of fine Lawyer reports that Thacher Proffitt & Wood, which had white-gray dust. Amid the destruction, a realistic, life-size 142 lawyers working on the 38th, 39th, and 40th floors of statue by J. Seward Johnson Jr., “Double Check,” remains the World Trade Center, restored its computer systems and intact. The bronze businessman still sits on his concrete access to backed-up data within two days of the event.5 bench, looking through the contents of his briefcase. The dust that floated down like snow includes the remnants of Tasks in Business Continuity Planning critical documents. Potomac Consulting Group’s Bob Dolinsky has outlined According to real estate services provider Grub & Ellis major tasks in business continuity planning (BCP).6 The Company, 15.5 million square feet of commercial office most important task is securing management approval. space in lower New York City was destroyed on September Convincing management of the importance of planning is 11.1 The U.S. Army Corps of Engineers has estimated the difficult because the benefits are not quantifiable or total weight of debris at ground zero to be 1.2 million tons.2 realized until the plan is executed. Nevertheless, successful Businesses housed in the World Trade Center lost desktop implementation depends upon management support computers, network systems, applications and storage because comprehensive plans are interdepartmental and servers, and communications infrastructure, as well as call for input and cooperation of all employees. files, records, documents, and other work product. Early Another major task in BCP is strategy development, wherein estimates suggest that between $2 billion and $5 billion firms identify, assess, and prioritize critical functions, worth of telecommunications and computer equipment services, applications, infrastructure, and data components. were destroyed.3 Each department within the firm needs to consider the The Value of Planning levels of disruption to determine acceptable timetables of recovery. Once a plan has been formulated, it is essential to Despite the devastation of the terrorist attack, many foster awareness of the plan. People need to know how to businesses did not lose critical data or timely access to their react and what immediate actions to take in the event of a information systems. Many companies with offices at the disaster. The most meticulous contingency plan is World Trade Center began preparing for business worthless if the staff does not know how to implement it. continuity in the wake of a disaster after the 1993 bombing of the towers. Moreover, data systems at many companies The most common strategy to safeguard against loss of were evaluated for recovery issues in anticipation of electronic information is regular backup onto magnetic potential disruptions associated with Y2K. Faced with the tape or other storage media. As one company learned when possibility of a serious business interruption, companies it lost the storage server and main server located in the instituted systems and data recovery plans as part of same room in one of the WTC towers, the backup media comprehensive business contingency strategies. needs to be moved to an off-site storage location.7 As a result, companies that had continuity plans in place Other options for data storage are redundant server sites were better prepared on September 11 to make decisions, within the company or new strategies such as remote data mobilize efforts, and face the challenge of quickly restoring mirroring. The frequency of data storage must be business capacity. Joy Heath Porter, director of applications considered as well. Data that is added to the system in at the law firm of Sidley Austin Brown & Wood, reports between storage cycles is vulnerable to loss. To ensure the that data restoration from backup tapes began as early as timely recovery of data, companies need restoration noon on Wednesday, September 12, and e-mail was procedures that are documented and tested. ILLUSTRATION BY JOE FLEMING ILLUSTRATION

6 ADDITIONAL RESOURCES

Disaster Recovery Institute International www.drii.org Provides disaster recovery education courses. Web site includes Download Library and Professional Practices manual. for DATA SECURITY Disaster Resource Guide www.disaster-resource.com/ Web portal for disaster recovery. Includes full-text articles Schemes for business recovery are not limited and useful vendor and organizational resources. to the protection of electronic data. Planning should consider potential equipment losses as Disaster Recovery Journal well. A detailed inventory will allow firms to www.drj.com/ distribute supplies and equipment efficiently in The journal is free to anyone charged with management the event of a crisis. Also, companies can responsibility for business continuity planning (BCP) in establish relationships with vendors so that the United States. Web site includes sample plans and replacement equipment can be quickly secured special reports. and delivered. Cindy Diamond One of the biggest challenges on September 11 thorough, well-tested, and broadly implemented plan is a was the loss of telecommunications infrastructure. When form of insurance that will not only preserve critical data, phone lines went down in New York City, many people but also protect the firm’s practice, clients, and employees communicated via the Internet using wireless devices such against future losses. as BlackBerry™. Businesses can reduce the risk of sustained outage by contracting with multiple telecommunications providers. Similarly, remote Web- enabled systems can help ensure access to business-critical information when phone service is disrupted. In addition to data security, offices must prepare for possible physical displacement. During the first weeks after the attacks, nearly one-fifth of New York City’s lawyers were unable to return to their offices.8 A comprehensive contingency plan should consider procedures for using appropriate alternative work spaces. The business continuity planning and disaster recovery industry contends that no one could have fully planned for the destruction and disruption caused by the September 11 attack. Nevertheless, the legal community has been given an opportunity to learn from the tragedy and understand the importance of disaster recovery planning. Now is the time to evaluate and improve recovery strategies. A

1 Building.com News, retrieved from www.buildings.com electronic version available at www.thacherproffitt.com /Articles/detail.asp?ArticleD=324 (Sept. 14, 2001). /article.ihtml?id=407 (last visited Jan. 10, 2002). 2 FEMA News Room, retrieved from www.fema.gov 6 Ashby Jones, “The Aftermath: Working Without an Office,” N.Y.L.J. /emanagers.nat092601.htm (Nov. 26, 2001). Sept. 13, 2001, at 1, electronic version available at www.nylawyer 3 Richard L. Arnold, “Recovery from Sept. 11 Events Is Slow .com/news/01/09/091301b.html (last visited Jan. 10, 2002). Process,” Disaster Recovery Journal Special Report: Attack on 7 Janette Ballman, “Terrorist Attacks Have Far-Reaching Effects on America, at www.drj.com/special/wtc/drjwtcspecialh.pdf Businesses,” Disaster Recovery Journal, at www.drj.com (last visited Jan. 10, 2002). /special/wtc/1404-03.html (last visited Jan. 10, 2002); “Strohl 4 Joy Heath Porter, Business Continuity Planning, Law.Net webcast Systems Discusses BCP Lessons Learned in the Aftermath of (Nov. 14, 2001). Sept. 11,” Disaster Recovery Journal Special Report: Attack on 5 Alison Frankel, “Back on Their Feet: Thacher Proffitt Wood lost America, at www.drj.com/special/wtc/drjwtcspecialh.pdf (last its office and everything in it when the WTC collapsed. But it visited Jan. 10, 2002). didn’t lose its people,” American Lawyer, Nov. 2001 at 22, 8 Ballman, supra.

7 INNOVATOR PROFILE

TomDyer

H&K CONSULTING, INC.

BY KINGSLEY MARTIN

om Dyer is leading the industry by Integrating Legal and T introducing ways to leverage law firm Consulting Practices expertise and personnel, and by developing During his first year at Holland & Knight, Dyer worked growth opportunities for traditional legal with McBride and a committee of directors to implement practice. Dyer is the president and CEO of entrepreneurial spirit across the firm. While other Holland & Knight Consulting, Inc. (H&K organizations were pursuing dot-com dreams and Consulting), a provider of consulting services. developing packaged legal services, Dyer looked to the H&K Consulting is a wholly owned subsidiary unique expertise of the firm’s personnel. He was of Holland & Knight LLP, one of the world’s determined to develop integrated multidisciplinary Kingsley Martin largest and fastest-growing law firms. ancillary services and convert cost centers, such as IT and other support services, into revenue-generating units. Dyer Prior to joining H&K Consulting, Dyer was vice president presented his business plan to the firm in December 1998. and director of several family trusts managing more than It was accepted, and H&K Consulting was formed in 26,000 acres in the southeastern United States. His work April 1999. involved strategic planning, permitting, and land use issues involving private, corporate, and public landowners. Often, Today, the firm’s consulting business employs 40 the focus of land management was directed at preserving consultants distributed among five units: H&K the integrity of trust ownership in the face of government Investigative Solutions LLC, H&K Real Estate Solutions condemnation. This work brought Dyer in contact with law LLC, H&K Strategic Communications LLC, H&K Strategic firms and changed the direction of his career. Business Solutions LLC, and H&K Translations LLC. In January 1998, Dyer was recruited to Holland & Knight by Many law firms have attempted to expand into other Bill McBride, at that time managing partner. Under McBride’s businesses. Some of these efforts have been highly leadership, Holland & Knight rapidly expanded from its base successful. For example, Womble Carlyle Sandridge & in Florida to become a global provider of legal services. In Rice, a law firm based in Winston-Salem, N.C., developed adopting its growth strategy, Holland & Knight faced FirmLogic, a company specializing in document coding increasingly stiff competition from both law firms and and review. FirmLogic generated $23 million in 2000, or consulting firms. McBride engaged these organizations nearly 20 percent of the law firm’s income. FirmLogic is head-on and sought to diversify into related consulting expected to bring in more than $30 million in 2001. Many practices. This vision will continue under Holland & affiliate businesses, however, have been sold by their law Knight’s recently elected managing partner, Bob Feagin. firm sponsors.

8 “The future for some law firms is ... leveraging nonlawyer services.”

What has made H&K Consulting successful? In Dyer’s prohibit law firms from entering into partnerships with opinion, “the factor that distinguishes H&K Consulting is nonlawyers. Nevertheless, law firms may employ the integration of services between the law firm and its nonlawyers and, as in the case of H&K Consulting, form consulting arm.” Unlike the diversification strategies of wholly owned businesses. But the development of affiliate other law firms, “H&K Consulting has been developed in businesses is not without risk. Hildebrandt International, partnership with the law firm and the focus of the a consulting firm offering highly regarded business consulting work is law-centric,” Dyer says. In fact, 90 advisory services to law firms, warns that law firms should percent of the consulting firm’s engagements are drawn carefully consider the ethical and management issues from the law firm’s clients. surrounding the formation of captive businesses. Two Business Models Holland & Knight applies the same fiduciary standard of Under Dyer’s leadership, the consulting work follows two independence to both its legal and consulting services. In business models. The first model targets services that can Dyer’s words, “while the lines between legal and business support all legal practice areas, such as investigative consulting may be blurred in the eyes of the firm’s clients, services. Generally, such support services are performed at they can rely on the same high standard of representation.” the direction of lawyers and do not directly interface with Dyer has also addressed the difficult management issues the client. For example, H&K Translations was recently surrounding the development of commercial ventures, engaged to help a South American university open an and in particular the difficulty of managing teams whose extension in the United States and apply for accreditation. work crosses multiple jurisdictions and requires expertise The representation required the translation of nine in various specialized areas. Each representation has a volumes of curricula in one week. project manager responsible for assembling the team and The second business model seeks to partner the consulting guiding the work. Dyer is looking into ways to automate business with one or more practice areas to develop procedures and institute best-practices guidelines, but also integrated solutions marketed to specific industries. In looks to interpersonal relationships and continuing these cases, consultants work directly with the firm’s education for process improvement. clients. Recently, H&K Strategic Business Solutions In managing these businesses, Dyer is introducing some developed an online maritime compliance program innovative ideas that can prove to be models for traditional designed to help multivessel owners and operators comply law firms and diversified ventures. One of the keys to the with operational, environmental, labor, and security laws success of H&K Consulting is the firm’s ability to deliver and regulations. The site is updated daily by a Holland & services across geographic and organizational boundaries. Knight attorney in the face of rapidly expanding regulations promulgated by the Coast Guard following the H&K Consulting has no home office and often partners September 11 attacks. The solution also contains a separate with its clients in delivering business solutions. site for training and testing. The Role of Technology Dyer’s business approach is evident in all aspects of the H&K Consulting is also focusing on innovative ways to consulting business. Every engagement is charged on a fixed- deliver services and manage knowledge within the firm. fee basis. Indeed, the pricing approach is illustrative of ways Electronic systems are used to deliver and maintain client- that traditional legal services can migrate from the current driven solutions such as online compliance programs, hourly fees to mixed fixed-fee models, based on the value of satisfying client needs, and significantly reducing the services. Dyer employs a two-step engagement process. In maintenance costs. In the knowledge management arena, the first stage, the consulting firm performs an assessment of Holland & Knight has taken a partner to focus on internal requested services. Then, in the second stage, H&K Consulting and external knowledge solutions and the creation of develops its findings, makes recommendations, and commoditized legal services. “Using technology has undertakes the engagement. By breaking the representation brought about our biggest successes,” Dyer asserts. into assessment and service components, much of the uncertainty regarding the scope of services is reduced. In fact, While many other firms have followed their clients around such risk reduction processes are now applied by Holland the world to serve their traditional legal needs, Holland & & Knight in the pricing of traditional legal services. Knight and Tom Dyer have pursued a strategy of expansion through the development of affiliate consulting Ethical and Management Issues business. In Dyer’s words, “the future for some law firms In order to preserve the independence and integrity of legal is the development of subsidiary businesses and practice, the ABA Model Rules of Professional Conduct leveraging nonlawyer services.”

9 PRACTICE STATISTICS OF NOTE

Industry Innovations

U.S. Online Users 2000–2006 Source: Jupiter Internet Population Model, 10/01 (U.S. only) 210.8 200.5 200 MILLION US ONLINE USERS 187.5

173.1 U.S. Broadband Households 1999–2006 71% Source: Jupiter Internet Shopping Model, 5/01 (U.S. only) 157.6 68 160 35.1 64 141.5 35 MILLION HOUSEHOLDS 60 30.7 124.7 55 30 25.7 120 50 25 44 20.6 20 15.4 15 80 10.0 41 percent of households online

10 9 percent of households online 5.2 5 1.8 40 1999 2000 2001 2002 2003 2004 2005 2006 CABLE DSL SATELLITE FIXED MODEM WIRELESS

2000 2001 2002 2003 2004 2005 2006

ONLINE USERS PERCENTAGE OF US POPULATION

Mobile Appliances Installed Base 2000–2005 74.9% Source: Jupiter Internet Appliance Model, 10/00 (U.S. only)

60 MILLION DEVICES

10 9.4% 7.3% 4.4% 2000 2001 2002 2003 2004 2005

VOICE-CENTRIC HANDSETS OFFLINE PDAs DATA-CENTRIC HANDSETS WIRELESS PDAs

10 U.S.Top 10 Web and Digital Media Properties Source: Jupiter Media Metrix at www.jmm.com/xp/jmm/press/industryProjections.xml

The Media Metrix ranking includes the top 10 Web and digital media properties according to combined unduplicated home/work usage in the United States. Unique Visitors—At Home and At Work Combined in the U.S. Measurement Period October 2001 rank property unique visitors total usage minutes average minutes / month

1 AOL Time Warner Network* 83,871,000 44,894,000,000 535.3 2 MSN–Microsoft Sites* 70,720,000 10,994,000,000 155.5 3 Yahoo! * 68,364,000 10,494,000,000 153.5 4 Terra Lycos* 39,514,000 701,000,000 17.7 5 X10.COM 39,334,000 64,000,000 1.6 6 Vivendi-Universal Sites* 36,458,000 535,000,000 14.7 7 About/Primedia* 33,220,000 491,000,000 14.8 8 eBay* 25,945,000 2,498,000,000 96.3 9 Walt Disney Internet Group* 25,386,000 931,000,000 36.7 10 eUniverse Network* 25,156,000 298,000,000 11.8 * represents an aggregation of commonly owned and/or branded domain names

Global Top 10 Web and Digital Media Properties Source: Jupiter Media Metrix at www.jmm.com/xp/jmm/press/industryProjections.xml

Argentina, Australia, Brazil, Canada, Denmark, France, Germany, Italy, Japan, Norway, Spain, Switzerland, United Kingdom, and United States combined September 2001 – At Home rank all digital media unique visitors digital media reach %

1 MSN–Microsoft Sites* 137,895,000 67.4 2 AOL Time Warner Network* 114,808,000 56.1 3 Yahoo! * 113,160,000 55.3 4 X10.COM 42,148,000 20.6 5 Lycos Sites 40,047,000 19.6 6 About/Primedia* 36,537,000 17.9 7 Vivendi-Universal Sites* 35,632,000 17.4 8 Excite Network* 34,241,000 16.7 9 Terra Lycos* 33,650,000 16.5 10 Google Sites* 33,208,000 16.2 * represents an aggregation of commonly owned and/or branded domain names

11 Book Review

PRACTICE INNOVATIONS cont’d from p5 publications, are evolving to accommodate digital information and changes in technology; however, there West Group are questions as to how far such practices can be stretched. For 610 Opperman Drive example, current systems of cataloging are too labor-intensive to Eagan, MN 55123-1396 be scaled up to cover the mass of (often ephemeral) electronic documents. USA Those who believe libraries will wither away cite some common Three editions of Practice Innovations misperceptions—namely, that all useful information is available on the are published each year. Internet, where it can be located by anyone willing to spend the time to search for it. Only a small fraction of the world’s information, however, exists in March 2002 digital form. Moreover, professional assistance in finding information is Please direct any comments or questions often more cost-effective than self-service. Commercial vendors of online to either of the editors in chief: information systems (Borgman cites Lexis and Westlaw® as examples) add value in several ways: gathering content; providing user-friendly interfaces Editors in Chief and search engines; striving for accuracy, completeness, and currentness in the information they provide; and providing editorial enhancements, Austin Doherty collateral services, and user support. Hogan & Hartson L.L.P. 555 13th St. N.W., Rm. 10W100 The Invisible Library? Washington, DC 20004 202.637.8701 (voice) Libraries do face a real danger of becoming invisible as they provide more e-mail: [email protected] services electronically and users do not identify with the provider of the services. Other challenges include managing hybrid collections, managing distributed William P. Scarbrough Kirkland & Ellis collections, and preserving information in digital and nondigital media. Tower 42 As we move toward a global digital library, we encounter both opportunities 25 Old Broad Street London EC2N 1HQ and challenges. We have the opportunity to make an enormous amount of United Kingdom information available to communities with very particular interests and to +44 (0) 20 7816 8731 (voice) broad audiences. Our challenges include interoperability (getting systems to +44 (0) 20 7816 8800 (fax) work together); portability (enabling software to work on existing systems); e-mail: [email protected] and data exchange among different systems. Moving from the Internet to the GII will involve supporting users in new orders of magnitude and diversity, Communicating best practices and innovations in law firm information and knowledge and connecting communities that are currently outside of the electronic management to legal professionals. information infrastructure. Borgman concludes her book by saying that access to information is too Managing Editor important to be left to professionals, corporations, and governments. Wil McClaren “[Access to information] is a problem faced by people in all walks of life, at West Group most stages of life, in all parts of the world.” 610 Opperman Drive Eagan, MN 55123-1396 651.687.1620 (voice) 651.687.8722 (fax) We’re Online! The trademarks used herein are the trademarks of their respective owners. West Group Recent issues of Practice Innovations are available online in Portable trademarks are used herein under license. Document Format (PDF). You can also subscribe to Practice Innovations online. Visit www.westgroup.com/aboutus/newsletters/practiceinnovations. To enter a subscription, click Subscribe in the right frame. To view an issue © 2002 West Group of the newsletter, click its link in the right frame. (If you want to download Printed 3/02. free PDF reader software, click Need a PDF Reader? and you will be Material # 40055322 connected to www.adobe.com.)