Bringing KM and business services together

Carefully selected knowledge management activities elsewhere in the firm can bring real benefits for fee earners as well as business services. This case study looks at some of the work the KM team at UK firm Addleshaw Goddard has been doing to encourage collaboration and KM throughout the business. By Mark Gould, Addleshaw Goddard

Law firms generally have a long history of knowledge management (KM) processes for lawyers, even before it was known as such. The use of precedent documents is a good example, as is the practice of training junior lawyers by pairing them with more experienced practitioners during pupillage or the training contract – effective knowledge transfer is clearly embedded at the heart of the profession.

As law firms have grown larger and the law itself has become more complex, the need for more formal (and often impersonal) processes for KM has also increased significantly. At the same time, the transformation of law firms into multi-million pound businesses (often with a global reach) has driven the creation of a significant cadre of specialised support staff and management. In some firms, the business-services functions have grown to the point that client-facing advisors are now matched by an equivalent number of support staff (including secretaries).

The combination of these two factors raises a number of questions. What is the state of KM in law firms for their business-services staff? Why should we be concerned about KM support for business services? What benefits might the firm get from developing KM for business services?

The relationship between KM and business services
Although Addleshaw Goddard is a fairly recent convert to centralised KM – we have had professional support lawyers (PSLs) within the key practice areas for the best part of a decade – we have made a particular effort to assist our business-services teams with KM guidance, especially because there is a good understanding of, and thirst for, KM in these areas of the firm.

By comparison, straw polls at Ark Group conferences on KM in law firms in November 2006 and April 2007 suggested that few firms’ business-services KM programmes compare with those aimed at lawyers. No more than half of those attending the conferences had engaged their business-services staff in KM activities. Why is this?

Law firms have proved to be very good at using KM directly in the practice of law – developing KM solutions designed to make lawyers more effective. They use standard documents and processes that reflect the needs of their lawyers and clients, and also commonly use their legal knowledge as a business-development tool in the form of bulletins and client seminars.

Additionally, many firms are getting better at going beyond this starting point by using KM to drive business development. The skills and tools developed in managing legal knowledge have now been turned to improving the firm’s understanding of its clients and their markets or sectors so that they can be better served. In some firms, these tasks also fall to PSLs, in collaboration with business-development teams. The evidence suggests, however, that law firms are generally less skilled at using KM to improve the effectiveness of their internal processes.

The focus on client needs that has driven firms to broaden their KM approach beyond purely legal issues is generally derived from the work of the late Peter Drucker, whose most basic precept can be summarised as ‘the purpose of a business is to create and serve a customer’. In her overview of Drucker’s work, The Definitive Drucker, Elizabeth Haas Edersheim uses a car as an analogy to illustrate this principle. The car itself represents the business, with the customer at the steering wheel, and the four road wheels standing for the essential elements that need to be managed for the business to flourish and grow in the right direction: innovation, collaboration, people and knowledge.

For Drucker, these four elements are clearly linked. A deficiency in any one of them can destabilise a business in the same way that a puncture will upset the balance of a car. If we consider, for example, the set of relationships between a company and its legal advisors, the links between knowledge and innovation should be clear.

At its most basic, businesses work best when they can identify and meet their customers’ needs. The business must know and understand the customer and innovate to meet those needs (and thereby to differentiate itself from its competitors). Those advising the business internally need to know and understand the customer focus of the business in order to be most effective and to create opportunities to deliver their advice in an innovative fashion – supporting the business’ overall innovation. Going beyond the company, external lawyers serve their clients best when they make the effort to find out what the client needs, and can innovate accordingly. Just as the company’s internal lawyers (a business service peripheral to the main focus of the company) need to know and understand their ultimate customers, so should law-firm support services. By doing so, they can perform their roles in the most effective way and even innovate for the benefit of the firm and its clients. Each of these steps implies that:

There is knowledge of the tier immediately above;
There is a cumulation of knowledge as we progress down the chain;
Improved knowledge can improve the quality of the service or product provided as well as creating the opportunity for innovation.

If we do not include law-firm support services in this chain of knowledge and innovation, there is a risk that the knowledgebase is incomplete and the potential for innovation is reduced – to the detriment of the firm and, ultimately, the client.

The knowledge chain
It may be trivially easy to ensure that the knowledge chain is complete. At Addleshaw Goddard, we have included all of the firm’s people in our expertise database. This enables staff to tell the firm about their educational and work history as well as their personal interests. We have used the database to support our business-development work by finding out who might previously have worked for a potential client (or in the same sector). We have also been able to use people’s experiences to help directly in client-related work – in one case, knowledge provided by one of our office staff about his hobby was critical in informing the approach to a piece of litigation.

Like many firms, Addleshaw Goddard’s knowledge strategy builds on and contributes to the achievement of the firm’s overall strategy. That strategy is consistent with what you would expect from a firm of our size: we want to be bigger and better, doing better work for bigger clients. There are, however, two elements of the strategy that are particularly relevant to KM for business services – particularly when considered together with our culture and values statement. These are summarised in the strategy as ‘invest for profit’ and ‘great people’. Part of the investment that we have made and will continue to make is in good people, and it is important to the firm that this extends to all – lawyers and non lawyers. The leadership of the firm has sent a clear message that all our people are important to the our success – not just the lawyers.

Culture and values
Addleshaw Goddard’s culture and values statement, known as the AG Way, is a set of behaviours reflecting the way we do things in the firm. The drivers for doing KM in business services are found in all the different strands of the AG Way. We claim to be ‘driven to find innovative approaches,’ but this cannot apply in one area of our business (client-facing), yet not another (business services). This is not an AG Way purely for lawyers. Likewise, the imperative to ‘provide practical and commercial solutions’ or the exhortation to be team players by ‘working together for our clients’ are important across the firm. Most important, however, is the statement that ‘we achieve success through the best of everyone.’

There is another, implicit, element in our culture – the principle that we act as ‘one firm’. On the face of it, this could be an exhortation to ensure that there are no barriers between our three different locations in the UK, to ensure that we cross-sell effectively, or even that we ignore differences arising from our history as two or three separate firms. Just as important as all of these, in the KM context it means that there can be no assumption that a lawyer’s contribution to the firm is automatically more important than one of our internal accountants, project managers or IT professionals. Without the support of those people, the lawyers’ capacity to generate fee income would be severely hampered.

A second additional principle has grown out of our determination to work with our key clients to add value to their businesses. Like most modern firms, we follow Drucker’s first principle in stating that we work to understand our clients’ businesses – this mantra has become commonplace. Addleshaw Goddard is trying to take this a step further by promoting a mindset within the firm that is driven by demonstrating in every interaction with clients that their needs are always uppermost in our minds. This idea is also important within the firm – all our processes need to reflect client needs, and one of the ways this can be achieved is by improving effectiveness through KM.

How should knowledge management engage with business services within the law firm? I think there are three critical elements for success.

The first is that law-firm knowledge managers need to intensify their relationship with other areas of business services to find people who have an interest in or some experience of KM (or even a relevant qualification). The expertise database might help here, but there is no substitute for personal visits and conversations with people. If we fail to use the talents that our people already have, we waste valuable opportunities to improve the work that the firm does.

The second critical element is that KM projects within business services have to be carefully chosen. They need to have the right drivers (in order to answer the question ‘Why are we doing this?’), preferably derived from client needs, the needs of the firm, or a need to improve the effectiveness of service provision in a particular area through the application of KM.

They need to take account of appropriate KM principles (capturing or disseminating knowledge, ensuring timely review, and so on).

They need to be capable of benefiting from, or providing benefits to, other KM projects or activities elsewhere in the firm (cross-fertilisation). This might be achieved, for example, by using a business-services KM project as a test-bed for a particular tool or technique.

Finally, but most importantly, there needs to be a general understanding within the firm of what KM is. Without this, there is a risk that people think KM is either more limited or more expansive than it actually is. If they feel that KM is irrelevant to a project, whereas in fact it might add significantly to it, the firm risks wasted effort on the project. On the other hand, if the KM team is drawn into too many projects that have only tangential relevance to KM, they will be unable to concentrate their efforts properly.

To give an idea of what KM for business services might look like, here are three examples of activities that we are involved in at Addleshaw Goddard.

Improving the pitch process
Our business-development team has incorporated KM principles within a project designed to improve the way that pitches and tender documents are prepared. The project is driven by a number of concerns about the way in which such documents are currently created, especially the ineffective use of partner and solicitor time and fears that the quality of the ultimate document is not as high as it could be (which carries an obvious risk that we could lose out on opportunities). Additionally, there is a continuing need to innovate in this area – every time a client goes through a pitch process, their expectations as to all aspects of the quality of the document increase. From a KM perspective, the critical element is to ensure that we create effective documents from the knowledge that is embedded in the firm, including especially careful re-use of information and other material from previous tenders.

In order to deliver what is required, we are working on a proposal generator that will create a better first draft of a tender document than we can currently manage, by using and re-using key material which is managed within the proposal system (with clear ownership and review requirements). This material is either extracted from previous documents or created especially for a given document, depending on the client’s requirements. In addition to ensuring that information and knowledge is captured in an improved manner, the system will enable the lawyers involved in the pitch process to concentrate their focus on the client’s needs rather than basic drafting.

Documentation and communication within IT
Our IT directorate is divided into two parts: IT Technical Services (dealing with major projects and management of the IT infrastructure) and IT Business Services (managing some non-infrastructural IT, as well as providing training and help desk services). This organisational split is sensible for a number of reasons, but can occasionally lead to problems when the business-facing help desk and training teams do not adequately understand the systems created by the Technical Services team.

These problems have been addressed by two collaborative tools. The first is the creation of a help desk role, the ‘technical lead’, who is responsible for liaising between the two sides of the IT team to ensure that the help desk is properly briefed about projects and infrastructural developments. This has improved the level of knowledge sharing at a human level. More impersonally, the projects teams are working on improving project documentation through the use of a wiki, which will serve as a test-bed for this form of social software and can be used as a demonstration of the capabilities of the technology elsewhere in the firm.

Collaboration and team-building in knowledge and learning
Addleshaw Goddard created a Knowledge & Learning Directorate by combining Learning & Development and Information Services (formerly located in the HR and Facilities Directorates, respectively) with a new KM function. As a new grouping, it was important to us to act quickly to create a culture of team work and collaboration amongst people who might not previously have known each other. We have relied heavily on technology to support these interactions. In the first place, we created a blog for the directorate, which we use to share information about our work and wider interests. We also started to use Live Meeting, a web-based conferencing system, as a forum for our monthly team meetings. This has proved to be very useful in keeping people briefed in a timely fashion (there is no shortage of meeting rooms) as well as permitting meetings to be recorded for the benefit of those who are unable to attend for any reason.

Both of these are established technologies outside the firm, but are relatively new within the firm (our blog was the second to be set up in a law firm environment). As a result of our experiences (together with other pilot projects elsewhere in the firm), we have learnt much about the technologies, which will inform and improve wider use of these tools across the firm.

A final thought
Inevitably, and rightly, law firms will concentrate their KM efforts on activities that are closest to the income-generating client relationship. However, this focus should not preclude carefully selected KM activities elsewhere in the firm, especially as such activities may bring real benefits for fee-earners as well as business services.

Mark Gould is head of knowledge management at UK firm Addleshaw Goddard. He can be contacted at mark.gould@addleshawgoddard.com