Fresh look at forgotten data reveals hidden value
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For many companies, patents are like buried treasure — valuable assets languishing in forgotten corners of the enterprise.
So a way to gain insight into patent portfolios would not only help companies assess more accurately the value of their intellectual property assets, but it would also enable them to generate hard cash by selling unused patents.
“Companies who’ve moved out of a product line have a mass of patents that they don’t use,” says Stephen Bishop, partner and co-chair of the intellectual property practice at Seattle-based Perkins Coie. His firm built a dashboard to do just that, known as the Patent Prosecution Platform, or P4. “Suddenly they have some value.”
As law firms look to extract value from the data held in legal documents, digital tools that help unlock this data are being developed rapidly.
For some, this leads to internal efficiencies and better decision making. Law firm Orrick uses technology developed by Foundation Software Group to track data in real time, which helps it make better choices on pricing and staffing and become more efficient in generating business.
“A firm like Orrick can dig into client market trends, make decisions about the emerging needs of clients and pursue them in a more efficient way,” says Barry Solomon, president of Foundation Software Group. “It also helps you avoid pursuing things the data show aren’t going to be worthwhile.”
Some efficiency tools resemble those used by consumers. At Fenwick & West, the tech and life sciences law firm, the “Fenni” digital assistant deals with queries on anything from billing rates for different clients to the new address of the firm’s New York office in the Flatiron district. Fenni can answer more than 570 specific questions, a number that will grow as its knowledge base expands.
“It’s not so much a change in the type of information,” says Mark Gerow, director of application development and business process. “It’s a more effective channel to deliver targeted information much more quickly to practitioners and support staff.”
The firm estimates it has saved about $200,000 in the year to date, by saving the time of its attorneys, partners, paralegals and associates.
In addition, by tracking the questions asked most frequently, the firm can identify potential process efficiencies. “If people constantly ask for billing rates, maybe other ways of getting information into their hands would be better,” says Mr Gerow.
What Fenni demonstrates is that data, when captured and analysed, can give firms more than efficiencies and cost cutting: it enables them to reflect on what they do, how they do it and what value certain activities bring to the organisation.
This was what motivated Michael Tucker, general counsel for Avis Budget Group, parent of car rental company Avis. His aim is to use data as a means of valuing something traditionally treated as a cost: the in-house legal team. Working with BCXponent, now called Cantilever, the consultancy arm of law firm Bryan Cave Leighton Paisner, Avis developed a dashboard that enables the legal team to demonstrate the contribution it makes to the business.
“We’ve taken our litigation process, our records management process and our transaction process, broken it down and analysed the impact it has on the final result, assigned weighting averages to it and fed in the economic data,” says Mr Tucker. “And it spits out what your impact was on revenue, margin, operational efficiencies and risk profile.”
This enables the department to justify requests for increased budget. In addition, says Chris Emerson, chief of legal operations solutions at Bryan Cave Leighton Paisner, once more data has been collected, it will help the department make better decisions on rate structures, based on whether a piece of work is “cream” (highest-value), “core” (day-to-day) or “commodity” (high volume, low return).
“Ultimately it will go from being a subjective decision made by an in-house lawyer to one where the computer is recommending a rate structure rate based on what the likely return on that matter will be,” says Mr Emerson.
However, while digital tools can use data internally to generate efficiencies and measure the creation of value, law firms are also looking to technology to enhance their ability to compete.
This is the case for Perkins Coie. Since clients can use the P4 dashboard themselves, they no longer need the firm to generate reports on their patent portfolio. While this means losing a certain amount of work, Mr Bishop argues that offering the dashboard builds loyalty and gives the firm a competitive edge.
“It makes us ‘stickier’ with our clients,” he says. “In intellectual property, the more you can help clients understand what they own, the more value you can provide to them.”
Innovative Lawyers North America Ranking 2018
- Top Innovative Law Firms: six of the best overall
- Most Innovative Law Firms: Business of Law
- Most Innovative Law Firms: Legal Expertise
- Rule of Law | • In-house
- Data, Knowledge and Intelligence | • In-house
- Managing and Developing Talent | • In-house
- New Business and Service Delivery Models | • In-house
- New Products and Services | • In-house
- Strategy and Changing Behaviours | • In-house
- Technology | • In-house
- Accessing New Markets and Capital | • In-house
- Enabling Business Growth and Transformation | • In-house
- Managing Complexity and Scale | • In-house
- Litigation & Disputes | • In-house
- Creating a New Standard | • In-house
- Canada: Legal Expertise
- Canada: Business of Law
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