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How easily people process what they perceive has a term in human factors research: load. There is “cognitive load,” meaning that when a dashboard, for example, takes a lot of thinking or remembering to make sense, it has high load. “Visual load” refers to what Prof. Edward Tufte would call chart junk or what we wade through when a page is cluttered, splashed with colors, animation, and multiple parts. “Motor load” applies less to practicing lawyers, but it is a third type.

These three loads come from Rotman Mag., Fall 2011 at 104. That magazine emphasizes integrative design thinking. This contribution gives a terminology and a framework for thinking about complexity (See my post of Sept. 14, 2011: three dimensions of complexity.).

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From an article in the Harvard Bus. Rev., Sept. 2011 at 70, comes a three-part definition of complexity. “The first, multiplicity, refers to the number of potentially interacting elements. The second, interdependence, relates to how connected those elements are. The third, diversity, has to do with the degree of their heterogeneity. The greater the multiplicity, interdependence, and diversity, the greater the complexity.”

To what degree a legal problem could be described as complex, by this definition, depends on the number of legal issues present that have some bearing on each other, their degree of interplay with each other, and how far apart they are in terms of being substantive legal areas that aren’t usually connected to each other. A major acquisition reeks of complexity; a small sub-lease renewal barely registers. A ten-year offshore agreement raises issues galore, solutions to those issues bump into consequences for other legal challenges, and a dozen hornbooks couldn’t cover the wide spread of problems that face the legal team.

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“In 2010 alone, NPEs filed 550 [patent suits] at a total cost of $7 billion to the defendant companies, according to defensive patent aggregator RPX Corp.” The quote comes from Intellectual Prop., Fall 2011 at 25. Does that mean last year the defendants in those suits paid $7 billion in settlements or damages? Does the figure include amounts they paid law firms and vendors during the defense of those cases?

In the back of my mind, data produced by an obviously-interested party – RPX undoubtedly wants companies to worry about NPE litigation (trolls) and to turn to RPX as a savior – needs to pass a tougher legitimacy test than data produced by a more objective researcher. I searched the RPX website and found no mention of the metric, let alone its calculation.

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People in legal departments who want to make sense out of the large volume of data generated by their various software programs, notably their matter management system, have several choices for how to dig through and make sense of that data.

Open source software called Hadoop lets users sift through massive data sets quickly and cheaply. Two startups, Datameer and Cloudera, offer variations that simplify use of Hadoop. Software like this may liberate law departments from thralldom to rows and columns as their architecture of storage and search; according to Bloomberg BusinessWeek, Sept. 12, 2011 at 72, “Hadoop can handle data that don’t fit into spreadsheets.”

This topic is beyond me technologically, but it suggests much more powerful, yet relatively inexpensive tools to help us learn from the increasing volumes of data law departments accumulate. Here are several related posts (See my post of Dec. 18, 2006: five common ways to report on data; Dec.12, 2007: Pfizer and Business Objects for its dashboard; May 8, 2008: exporting data from a matter management system to a spreadsheet; Feb. 15, 2009: third-party report writers; March 20, 2009 #1: visualization query language from Tableau Software; Feb. 10, 2010: software that may help in-house counsel make decisions on data; and May 25, 2011: third party report writers in order of number of users.).

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A survey of US legal departments about electronic data discovery (EDD), conducted by ALM Legal Intelligence for T. Wade Welch & Associates, produced findings in a supplement to the September issue of Corporate Counsel. In a previous post I picked at the sample size, but nevertheless I want to point out the cost-saving strategies listed in a sidebar (at 5). I have quoted the strategies and how many of the 41 respondents selected it, then added a comment or two.

Established records retention policies (16) – you don’t have to discover it if you no longer store it, and see my post collection below

Tracked outside firms’ work and billing (13) – nothing new here

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“For matters valued under $500,000, 71% of in-house counsel said they try to do as much EDD [electronic data discovery] as possible in-house.” This quote comes from research by ALM Legal Intelligence sponsored by T. Wade Welch & Associates, published in a supplement to the September issue of Corporate Counsel. ALM based this finding on 41 survey responses (35 in-house lawyers and 6 other roles, including 13 general counsel.).

Data is always welcome in the world of law department costs and operations, but you have to wonder if, based on this sample, this finding has much worth. Approximately half the law departments represented were in companies with less than $500 million in revenue, so their number of law suits, let alone the number of lawsuits that have significant value or burden of EDD, must be few.

The small, and possibly very unrepresentative, sample also diluted the value of the finding, but so does the finding itself. If 25 in-house lawyers (71% of 35) state that they try to do as much EDD within the company as possible, isn’t that likely what most people would say, because the “as possible” has such lack of objectivity? Perhaps one or two might say, “We have almost everything done externally.” Perhaps, but most people would say we do what we can inside and use external providers for the rest. By contrast, if the finding were that for smaller cases, “we do it all or virtually all inside,” that would be much more potent.

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According to this London-based company’s website and ads, GTDTonline provides in-house counsel with summaries of laws and regulations in 43 practice areas and more than 120 jurisdictions. The summaries explain “the most important legal and regulatory matters that arise in business deals and disputes worldwide.”

In-house counsel are eligible for a free GTDT Online password providing full access to the website.

This could be taken as an example of capital invested outside the United States in legal services, delivered worldwide by the internet, and thus a challenge to the privileged position of lawyers in the States.

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Those who manage in-house lawyers should have a framework for how to assess potential rates of productivity increase. In the August issue of Strategy + Business, at 33, Booz & Company states that during the 20 years from 1987 to 2008, US manufacturers increased productivity at a cumulative annual growth rate of 1.6 percent. The entire private business sector only managed a 1.0 percent rate, which means service-sector productivity barely rose year over year.

Law departments may have fared the same. I have several times returned to the topic of the meaning of in-house efficiency and productivity, which has multiple factors because it rests on labor and capital – capital primarily consisting of technology and knowledge resources (See my post of March 24, 2005: the gaping hole of productivity measurement; April 3, 2006: analysis of the term “productivity”; Aug. 8, 2006: assumptions in the term productivity; Feb. 7, 2008: productivity compared to capacity; and Nov. 29, 2009: productivity defined and talent tools discussed.). Multifactor productivity, which Booze defines as “the changes in economic output per unit of combined inputs,” probably can increase more where tools and machines operate, less where personal services such as legal counsel are paramount.

If one percent per year or so of productivity improvements has validity, expectations of increases in law departments – assuming we were able to measure it – should be in line. To that point, though, someone might say that legal departments wallow in 19th century practices and culture, so they are ripe for dramatic productivity boosts. I have my doubts, since the essential tool of lawyers – an experienced and educated brain – has evidenced few operational improvements recently.

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An announcement about the changing of the guard at the Association of Corporate Counsel mentioned that during one person’s tenure large law department memberships had increased 89 percent. Wow, impressive!

Wait! We don’t actually know whether that is impressive. The release did not state the time period or the starting number of members from large departments. It left out the definition of a “large law department,” the level of the new members, and their distribution by department. That is to say, if the expansion took place over ten years, it loses its luster. If the ACC started with 50 “large law department members” and added 45 more, that too is a less impressive story than starting with 500 and adding 450 more.

Further, if the ACC deems a “large law department” to have as few as 10 lawyers, the statement has different impact than if the term refers only to departments with more than 100 lawyers.

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Based on 245 U.S. law departments that have participated so far in the General Counsel Metrics global benchmark survey, as well as 36 Canadian law departments, and 113 from the rest of the world, here are three ratios:

3 lawyers for every paralegal in the United States and the same ratio, exactly, in Canada; but

5 lawyers for every paralegal in the rest of the world.

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