Though data analytics is typically associated with technology firms, its application in legal firms is widespread and valuable. When used effectively, data analytics in legal management can boost profitability while helping you find better client management and streamline procedures, all while saving your firm money. Do you need legal analytics and need help knowing where to begin? This post discusses its purpose, ways it could benefit your company, and how best to implement it.
What Is Legal Data Analytics?
Legal departments, solo practitioners and law firms alike have realized the significance of legal data analytics as an invaluable asset to their practice. By harnessing high-quality analytics tools, they are finding ways to boost critical areas of their legal practices. However, for optimal use, it requires specific tools; ERP software for legal analytics provides this support and will aid implementation enhancements along with advanced analyses for your law practice.
Legal analytics refers to the practice of examining unprocessed data to detect patterns, draw conclusions or detect trends unique to the legal industry. Legal analysts typically use methods and technologies such as artificial intelligence, machine learning and statistics to process the information gathered for legal analytics purposes.
The Role Of Data Analytics In Law
Why does accessing and analyzing legal data matter so much to business functions? Below are a few benefits of legal management data analytics provide your firm:
Brings Valuable Insights
Legal analytics from law firm analytics ERP software can better serve your firm, clientele, and larger market. Say, for instance, that you gather financial performance information about your firm, upon which half of clients owe invoices. Based on that discovery alone, more effective procedures for reaching individuals who owe invoices could be established more rapidly.
Support The Decision-Making Process
Once you unlock real-time insights from your legal data, you can use that knowledge to make more informed business decisions that eliminate bias from the decision-making process and increase the chances that actions taken will yield positive outcomes.
Helps To Test Assumptions
Making assumptions can be tempting, but making important business strategic decisions based solely on gut feelings should be something other than your go-to solution. By tapping into law firm data, you can test out assumptions to see if your theory holds.
How Is Data Analytics Being Used In Legal Practice?
Before exploring why many firms have yet to take this leap, let us outline its potential use cases.
Predictive Analysis
The predictive analysis offers law firms a competitive edge by helping to anticipate which judge will render the most favorable ruling and which case will most likely win. It also provides information about all parties involved in litigation and opposing counsel.
As attorneys can decide which cases to accept and the best strategy to implement should one proceed, lawyers have more control over ensuring that time and human resources are well-spent pursuing cases that turn out costly or unsuccessful.
Legal predictive analysis enables rapid assessments that require little intervention from a lawyer or paralegal. It provides accurate cost estimations based on past cases with similar aspects and then allows firms to offer fixed-price fees.
Marketing Analysis
Legal marketing teams employ data-driven marketing analytics to respond quickly to RFPs, refine pricing models and gain new insight into clientele.
Writing proposals and responding to calls for proposals can be time-consuming for law firms. Business development teams often need help collecting all necessary data and information to fulfill proposal requests. Thanks to data analytics technology, much of this process can now be automated, giving employees more time to fulfill their duties.
Law firms are rapidly developing in-depth knowledge of their clientele through data from social media activity, past sales information, website analytics, email campaigns, and customer relationship management systems (CRM). By doing this, they are developing highly targeted customer marketing strategies tailored to individual client segments.
Marketing teams can utilize A/B testing to compare the outcomes of various initiatives more scientifically. It allows them to investigate topics like which blog post content potential customers prefer, which features on our most effective advertisements and landing pages attract visitors, and which emails catch people's eye and prompt them to sign up with our services.
Legal Document Analysis/eDiscovery
Data analytics offers one of the most beneficial uses for law firms: making sense out of large quantities of information to support legal claims.
Electronic discovery (eDiscovery) refers to the process of searching for electronically stored information (ESI) relevant to legal matters on computers or networks and then collecting, organizing, processing, reviewing and analyzing that ESI for production and presentation (known as the EDR process).
Electronic discovery systems work by automatically recognizing patterns and themes using data analytics concepts, then reaching better conclusions to save both time and money thanks to predictive coding (also called technology-assisted review, or TAR), which allows attorneys to help train the ERP software using only part of the documents being reviewed.
Data analytics in the form of eDiscovery offers law firms a great chance to dramatically reduce document review costs while freeing up staff for higher-value, more lucrative work.
Also Read: Master Legal Practice Management: ERP Software Impact Worth $10K?
5 Common Applications of Legal Data Analytics
Implicating how internal and external firm analytics will fit into daily operations at your firm may be challenging, so here are five applications of firm analytics:
Conduct Legal Research
As an attorney, you conduct extensive legal research for each client. From familiarizing themselves with statutes to reviewing past cases, lawyers typically devote many hours towards this endeavor.
Legal analytics ERP software offers one way to save time when researching cases—it often features databases of past cases that you can refer back to for reference. For instance, if you're dealing with civil litigation in Minnesota, legal analytics can identify similar cases (and their outcomes), informing how best to approach this case for your client.
Are you in need of Tools but Don't Know Where To Begin? Don't panic; the American Bar Association provides a helpful list of free online legal research tools to help you start your search.
Provide Predictive Analytic Capabilities To Clients
Predictive analytics is another potential application of data. With specific tools available today, one can use existing information to predict characteristics, outcomes and resources spent on an issue. Let's use an example to see how this works:
Are You Deciding Whether or Not to Proceed with the Trial? Your client needs your advice on whether the investment of resources would be worthwhile. Legal analytics can give them some idea of the time commitment and chances of victory, which may assist them in making the best choice possible.
Optimize Administrative Processes Using EDiscovery Analytics
Lawyers spend much of their time collecting, sharing, and reviewing information with colleagues at the firm, an exhausting endeavor that often lasts months on end.
However, this administrative burden can be alleviated considerably thanks to ERP software solutions that facilitate electronic discovery. E-discovery advanced analytics tools enable lawyers to search documents for specific keywords or date ranges, or to detect trends within client data.
These functionalities facilitate information review by eliminating the need to sift through everything manually.
Hone Marketing Strategies
Law firm analytics ERP software allows your firm to refine your marketing efforts over time saving, such as collecting website data. By tracking that, various questions like these can be answered:
- How much time do a law firm's website visitors typically spend browsing its pages?
- Which services seem most appealing to potential clients?
- Can the law firm reach its targeted clientele through its website, and is traffic increasing over billable time?
Making more better-informed decisions based on this data will increase client lead conversion and revenue generation.
Enhance The Efficiency Of Business Operations
Lastly, legal sector data analytics can assist your company's matter management. Take this as an example:
Imagine that your company's revenue has recently decreased and that, to determine its source, you review each lawyer's company metrics, such as client acquisition costs and utilization rates, to locate where the issue lies. After running all these figures together, it becomes apparent that client retention rates have fallen over valuable time, suggesting employee departure from your workplace has contributed. Armed with this insight, further investigations should take place as to why employees leave and develop plans of action to prevent this in future years.
Conclusion
Data analytics in law can transform how your practice runs, interacts with clients and even approaches marketing. Discover ways that data analytics in law can enhance its operations, engage with them and even marketing initiatives. How legal analytics ERP software can assist your administrative procedures, case research project management, and conversion of client leads; it could even become increasingly influential as machine learning and artificial intelligence advance in the coming years.
