Articles Posted in Knowledge Mgt.

A footnote in the MIT Sloan Mgt. Rev., Fall 2006 at 89, n.1 set me thinking. “The terms intangible assets or intangibles refer to any nonphysical assets that can produce economic benefits. They cover broad concepts such as intellectual capital, knowledge assets, human capital and organizational capital …” Consider these my reMarx on Engels that occur of Das Capitals.

Intellectual capital in a law departments consists of the intelligence, training, mental discipline and experience of the lawyers and others in the department (See my post of . It’s what’s in people’s heads.

Knowledge assets in a law department include datases, guidelines, form documents, how-to’s, books, precedent files, intranets, and other forms in which knowledge is stored. The forms are tangible but what they capture is intangible. It’s what’s available from people’s desks.

InsideCounsel, June 2007 at 58, has a meaty article on knowledge management and law departments. This blog has more than 40 posts on various aspects of legal department KM (See my archival category, Knowledge Management.). The article outlines seven steps toward a successful program, one of which is to designate someone to lead or manage it.

The most favored choice to head a KM initiative is a lawyer who believes in the mission. The article makes the point that “leading a KM initiative is not a part-time job, so departments that do this should plan on operating with one less lawyer.”

Cisco, for example, hired a lawyer (Risa Schwartz) who had run her former firm’s knowledge management group. Another example cited by the article is Cadbury Schweppes, who appointed Steven Levine as its director of KM. Jon Olson, a lawyer with Alcatel-Lucent, oversaw the rolling out of his department’s knowledge management program in 2004. Amy Comeau at MetLife had significant responsibilities for knowledge management in that department. DuPont has a legal knowledge manager, Lynn Simpson.

I recently heard a veteran legal technologist describe what he saw as the three stages in law departments by which knowledge management. I will boldly add one more.

First there were simply tools installed, mostly databases and document repositories. Next firms and departments went beyond technology and content to gather insights and material about processes within specialty areas and practice groups.

According to him, as knowledge management has evolved into the third generation, it has become based on search technology. Tools are available within law departments to enable lawyers and paralegals to find material even though it has not been organized in a database or controlled with a taxonomic structure (See my post of March 5, 2005 on Google desktop; Dec. 10, 2005 on implicit search software; June 30, 2006 about new search tools; Feb. 19, 2006, May 14, 2005, March 6, 2007, and April 4, 2006 #4 about concept-search software; and Feb.25, 2007 about enterprise search capabilities.).

Myth 3 – If you have a records retention schedule that applies to paper records, you need to create another schedule for electronic records.

Truth 3 – Not necessarily so. If you have a sound, well researched records retention schedule that covers all of your hardcopy records, you are ahead of the game. The same retention periods that apply to hardcopy apply to digitize information. Under the law, and according to the courts, the generality is that the rules apply to the subject or content, not to the media.

Corollary 3a (to Myth 3) – It is ok to treat e-mail with a single retention period, say 90 days.

Myth 1 – The law says that as a lawyer, you have to keep everything forever.

Truth 1 – Not true. If fact, ethics opinions (Michigan Ethics Opinion R-5 (1989)) state that lawyers should have and enforce a records retention schedule because to do otherwise may put their client at risk. If the corporate client gets rid of something but outside counsel keeps a copy and counsel is then subpoenaed as part of an investigation involving the client, counsel (in most cases) will likely be called on to produce.

Myth 2 – Laws specify how long you have to keep client (or case, or matter, or….) files.

It is important and useful for in-house lawyers to understand some of the basic concepts of accounting as they apply to management of a department (See my posts of May 10, 2006 with data from Canadian law departments on the value of this knowledge; and May 7, 2006 on training for financial literacy.). My treatments of the following accounting concepts, skimpy but hopefully not completely wrong, deserves no kudos, but it brings some notions to the fore.

Accrual: How to treat legal costs incurred but not paid by a fiscal-period cutoff date (See my posts of Aug. 24, 2005 and Sept. 17, 2005 #4 about accruals.).

Capitalized and expensed legal spend: How to treat legal expenses incurred as part of a transaction, and therefore amortized over several years, as compared to current spend which is expensed during the fiscal year (See my posts of July 30, 2005 on capitalized legal expenditures; and Nov. 25, 2006 on stock options and how to account for their value.).

Lucent Technologies’ law department came up with a clever idea: “The department allotted every attorney [I think there were at least 60 at the time] $200 to purchase a book relevant to his or her practice area. Each attorney generated a summary or digest of the book for the rest of the staff.”

Ingenious! From this small mention in InsideCounsel, Sept. 2006 at 66, flow several points. The summaries could be searchable on an intranet site, the lawyers generate the knowledge organically – in connection with something they care about, and it would be possible to track hits on summaries and establish a recognition system (See my post of March , 2007 about internal markets for ideas.). A similar idea should apply to attendance at CLE events – the department pays for the registration and costs in return for which the lawyer circulates a summary (See my post of May 1, 2005 for more on this technique.).

Touched on here and there (See my posts of Sept. 10, 2005 on communities of interest; July 21, 2005 on brokering knowledge; and July 25, 2005 about knowledge management and communities of practice.), I haven’t defined communities of practice (sometimes called “communities of interest” or “centers of excellence”). A nice phrasing appears in InsideCounsel, Sept. 2006 at 66, in connection with several innovative steps taken by the law department of Lucent Technologies: “The communities of practice are groups of in-house attorneys that come together monthly or bimonthly to discuss a particular area of the law.”

In my experience, a community of practice sometimes adds material to an intranet site; sometimes invites speakers from law firms; circulates relevant cases and commentary; and often works toward standard terms and definitions in their documentation. At Lucent, there are eight such communities, which cover such topics as competitive intelligence, data privacy, regulatory affairs and open-source software.

In a recent speech, Mark Chandler, the general counsel of Cisco Systems, spoke fiercely and creatively at Northwestern School of Law’s 34th Annual Securities Regulation Institute (See my post of March 8, 2007 for Chandler’s thoughts about the plummeting cost of legal information.). Chandler referred in his talk to the Legal On Ramp.

Cisco and eight other Fortune 500 companies, together with a number of law firms, have created the web site. It will “allow direct access to search the firms’ KM [knowledge management] systems. The site will use wiki technology to drive collaboration.” I think this may be the same group that in mid-2005 announced a collective effort focused on the legal needs arising from the HR function (See my post of July 21, 2005.). Chandler hints broadly that securities work will be one of the first targets of the system.

My thought is that all the information in the world, easily found and at no cost, only partially helps a busy in-house lawyer who needs to answer a particularized set of legal questions. Answers – information – won’t help if the questions are unclear and balancing considerations is required. I’m also surprised that law firms will agree to scrub their intellectual property of client identifiers and give it away.

As veteran lawyers retire, invaluable experience goes with them. To ask them to write down their hard-won tacit knowledge is to be disappointed: few people like to write. “Enterprise search” capabilities, from such companies as Autonomy in the UK and Fast Search & Transfer in Norway, are alternatives on the forefront in the war against talent drain, according to the Fin. Times, Nov. 22, 2006 at 9.

Another tool is video recording. The same article describes how Ove Arup, the UK engineering group, salvages knowledge from its employees. “Ove Arup pensioners now record briefings on their specialist topics to video. Using Autonomy software, later generations of workers searching for information will be able to pull up relevant segments of the videos as well as text.”

It would be a far-thinking law department that arranges videos of post-mortem sessions (See my post of Dec. 10, 2005 on reviews after litigation concludes), or after someone attends a CLE event (See my post of May 1, 2005 on how to spread CLE learning.), before the retirement of a key lawyer (See my post of Sept. 4, 2005 on demographic forces.), and during training programs run by outside firms (See my post of Aug. 26, 2006 on other forms of experiential learning.).