United States: Legal Project Management – Some Questions For Law Firms To Consider In Incorporating Project Management Into Legal Transaction And Dispute Resolution Matters

The incorporation of a project management function into a law firm’s legal transaction and dispute resolution matters has been suggested as an effective and efficient means of reducing the costs and improving the quality of services provided by law firms.¹ The impetus for this is based in large part on recent surveys of corporate/in-house counsel which indicate they are concerned with, among other things, the high costs, lack of responsiveness, and poor communications from their outside counsel.

While some form of project management is widely used throughout the business world, the legal profession is only now beginning to realize the benefits project management may offer. A law firm contemplating the implementation of a formal project management function may find it useful to consider some basic questions including:

• What is project management and how does it differ from what is already done by the firm?
• Is there a need for project management within the firm?
• Is there a standard or recommended approach to project management?
• Can the project management function be performed using in-house personnel or should a project management professional be brought in?
• Should the costs of project management be passed along to the clients or should it be absorbed, in whole or in part, by the law firm?
• What metrics can be used to assess the success of a project management function?

Project management is the discipline of organizing and managing a team of individuals in initiating, planning, executing, monitoring, controlling, and closing out a required scope of work within a specified period of time and within a given budget.² In other words, project management provides a framework or structure to address the triple constraints of scope, time and cost for a project.

As applied to its application in legal matters, project management could also be defined as those activities relating to the management of the case as opposed to those activities relating to the development of the case. In this context, case management activities might include, among other things, the development and tracking of task-based work plans, schedules and budgets; allocation and management of personnel resources; identification, analysis and mitigation of risks; facilitation of communications within the legal team and between the legal team and the clients; preparation of status reports to the clients; and coordination and oversight of work product deliverables or submittals.

There is no bright line between case management and case development. In most law firms, many case management activities are typically performed by the legal professionals in the firm (from senior level attorneys down to the paralegal and even clerical support staff). However, effective and efficient case management involves business skills and tools that are different from the legal skills and tools used by the legal professionals for case development. Without these business skills and tools there may be an inefficient use of the firm’s professional resources leading to potential loss of focus from case development activities; redundancy of effort in completing management tasks, or worse, failure to complete critical management tasks altogether; and unintentional and unnecessary escalation of professional fees and costs.

The need for a project management function in a law firm will likely depend on a number of factors including: the size of the law firm, its practice areas and its case load, and its readiness and willingness to incorporate and support it.

A project management function would be well suited for law firms who have commercial practices involving transactional (e.g., mergers and acquisitions, intellectual property, etc.) or dispute resolution (litigation, arbitration, or mediation) matters. These types of cases typically involve multiple parties and multiple issues, can be lengthy in duration and procedurally complex, produce voluminous quantities of information and technical/financial data, and require multiple and time-sensitive submittals or work products. The management logistics for even a single case of this type can be formidable. For a firm that has a number of these cases going concurrently, the management logistics can be daunting. This supports the argument that case management should be considered as important and given as much attention as case development in order to ensure client satisfaction with the services provided. The recent client satisfaction surveys suggest this is not always the case.

Whether a law firm is ready and willing to implement and support a project management function may depend, in part, on the culture of the firm. Firms whose culture is, "it’s always been done this way", or, "our business model works for us", will likely be reluctant to explore much less implement a change in operating procedure that incorporation of a project management function would likely entail. On the other hand, firms that are constantly striving to be competitive in the increasingly global market for legal services may be more amenable to looking at project management as a way to differentiate themselves.

Some firms tout their use of technology (e.g., the use of intranets and extranets, specialized case management software, etc.) and "support teams" (e.g., in-house IT specialists, document imaging and database specialists, etc.) as value-added services to their clients. However, unless these services are carefully managed as part of an overall project management function, they may actually contribute to unnecessary escalation of costs.

A law firm may also see the need for a project management function in response to direct feedback it may have received from its clients on issues of costs, responsiveness, and quality of services. Informing a client that their concerns over these issues will be dealt with through the implementation of a project management function would go a long way toward addressing the client’s concerns in a positive and definitive manner.

For a law firm who believes that its legal professionals are already adequately addressing these issues (even in the absence of direct feedback from it clients), the firm may still want to consider the benefits of proactively implementing a project management function. This would send a strong message to their clients that the firm is making a serious commitment to providing cost-effective, quality legal services through a formalized case management process. Not only does this strengthen the relationship (and help to ensure more work assignments) between the firm and its existing clients, but it can also be a very powerful marketing message to secure new clients.

There is a bewildering array of information on project management processes, tools and techniques that has been written in publications and is accessible through a number of associations, organizations and internet resources.³ These information sources promote project management processes with varying numbers of stages (this author has seen as many as twelve discrete steps or stages defining project management), different nomenclature, and a focus on processes for particular types of projects such as construction projects or pharmaceutical research and development projects.

This plethora of information underscores the obvious; there is no one standard, unified or recommended approach to project management. Whether a project management process is based on existing models (in whole or modified) or designed from scratch, the key to successful implementation is that the process ultimately meets a law firm’s needs and objectives, and the firm’s financial and personnel resource constraints.

Since every case is different and every client has different needs and expectations, any project management process should be flexible enough to accommodate these differences. The chosen process should also be easily scalable to accommodate a law firm’s growth, changing needs and goals.

In firms where a dedicated project management professional may be difficult to justify for one reason or another, in-house personnel (such as paralegals or clerical support staff) with the appropriate training, responsibility, and authority can (and most likely do) perform many project management-related activities. If performed thoroughly and consistently, these efforts will likely increase the efficiency and improve resource utilization of the legal team and, facilitate firm-client communications even for single cases. However, these same support professionals most likely have other responsibilities and duties to perform, which, during times of increased case development activities and impending deadlines, may take precedent over case management activities.

Through their substantive knowledge and experience in this discipline, a project management professional, employed as part of the firm’s professional staff or brought in as an outside consultant, may be in a better position to determine what stages, tools and techniques would best apply to any given case. This professional should also have the skills and experience to manage multiple cases with multiple resources across different legal teams. This could be beneficial to firms with larger case loads where the costs of the project management function could be distributed across multiple cases while at the same time, the firm would benefit from a uniform, consistent approach to managing its case load more cost-effectively and time-efficiently.

It could be argued by a law firm’s clients that they are paying only for legal services and how the firm manages the execution and delivery of those services is up to the firm. The counter argument to this position is that a project management function, like the legal services themselves, is a value-added service designed to ensure all the attributes of high quality legal services are provided to the client. It is also worth noting that most consulting firms pass along the costs of their project management activities to their clients as part of their professional services.

For smaller cases, it may be harder to justify the added expense of project management-related activities for which the client is billed, particularly if a project management professional is contemplated. In those cases, a law firm may wish to consider absorbing the costs, in whole or in part, since the percentage of billable fees for project management-related activities is likely to be a very small percentage of billable fees for professional legal services.

For larger, complex transactions or litigation, a project management function could take up a significant amount of time. The cost-benefits of using project management would be relatively easy to sell to clients as a value-added service aimed at controlling costs, meeting deadlines, and facilitating effective firm-client communications. Accordingly, the costs should be billable to the clients as a separate line item, including the costs of developing the project plan, and setting up the baseline schedule and budget.

The most obvious metrics for measuring the success of a project management function are the very tools and techniques used to monitor and control the scope, schedule and budget for a project. These tools typically consist of some form of project plan detailing, in its simplest form, the work to be done and the resources to be utilized; a Gantt chart, basically a horizontal bar chart showing the sequencing, interrelationships and progress of the project tasks and task-related activities along a time axis; and a budget sheet, which can be as simple as a spreadsheet or integrated as part of a firm-wide computerized time-keeping and billing system. Tracking the time spent and the actual fees and costs incurred against the project plan, schedule and budget will provide a direct measure of successful project management.

Less obvious but perhaps more important metrics in terms of ultimate client satisfaction with the legal services provided are interim or milestone status reports (oral and written) and/or end-of-matter assessments or case debriefings. In all of these cases, the key to measuring the success (or failure) of a managed project is the feedback that must be solicited from the client in order for these tools and techniques to be effective metrics. Far too often, status reports are sent without any follow up by the sender or feedback from the recipient, and end-of-matter assessments are often not done at all.

Implementing a project management function does not have to be an onerous undertaking. Advanced planning and careful implementation will help to ensure that any initiative meets the needs and objectives, and the personnel and financial resource constraints of the firm. As part of this planning and implementation phase, law firms may want to consider the following recommendations:

• Consider Having A Preliminary Consultation With A Project Management Professional. A skilled and experienced project management professional can help a firm explore the need and the possible options or alternatives for a legal project management function. This minimal investment in time and money (a good consultant is not likely to charge for initial consultations) would be well worth it.
• Consider implementing a project management function incrementally. Start with some basic objectives (such as improving cost control internally in the firm by tracking actual costs against a task-based budget) and apply them to one or more relatively simple cases. Analyze what worked and what didn’t, then refine the process.
• Be proactive and involve the client in implementing a project management function. Engage the clients in a frank discussion of what a formal project management function would look like for the firm and what elements of that function would benefit the clients the most. Solicit their input in designing these elements if the concept moves forward to implementation.
• Resist the temptation to implement a "gold standard" project management function. Installing expensive hardware and software, setting up and maintaining extranets and intranets, and providing user training and technical support are not necessary to implement a project management function that will produce the desired results.
• Be open-minded and supportive of a project management function. Having the right personnel with the skills and tools to manage the case will allow the legal professionals to focus on developing the case, which, after all, is the core of the services being provided to the client. The legal professionals should also be mindful that these results don’t happen over night but proper planning, execution and support will maximize the chances for a favorable result.

Implementing a legal project management function into transaction and dispute resolution matters can be extremely beneficial to a law firm in meeting the needs and expectations of its clients for cost-efficient, time-efficient, high quality legal services. This will not only strengthen the firm’s relationship with its clients but it can serve as a powerful marketing point in differentiating the firm from its competitors in the global marketplace for legal services.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.