Law Firm Trends: Raising the Bar on Information Management
July 26, 2012
For most lawyers, sifting through volumes of information—client files, contracts, correspondence—every day simply comes with the territory, along with notoriously long hours. For their firm’s IT and records departments, however, managing those volumes of electronic and paper-based information presents a large challenge.
So how are most law firms handling this? Iron Mountain is sharing that data in its recently released Law Firm Information Management Benchmark Report, a survey of more than 200 law practices. Here’s what you need to know.
Iron Mountain Reports: Law Firms and Information Management: How Does Your Firm Rate?
The recently released Law Firm Information Management Benchmark Report shares Iron Mountain findings based on a survey of 200-plus law firms. How do your information management practices stack up?
Part I: The Top-line Trends
79% have a records management policy
28% are paperless or plan to be within five years
31% of those with a policy include paper but have no e-records policy
Part II: The Challenges
35% of firms polled say their attorneys’ collective reluctance to destroy client files is the biggest obstacle to maintaining a destruction program
15% report that a lack of consensus hampers their retention-policy efforts
12% simply don’t have the resources to review client files before they are destroyed
Part III: Managing the Wasteland
42% use secure containers to dispose of paper they don’t keep
27% use office shredders for nonconfidential paper
31% dispose of paper in recycle bins or everyday wastebaskets
For Some, It’s Life in the Fast Lane
The top-line news is very good: Law firms are taking control of their information, albeit at varying speeds. For example, 79 percent of the 200-plus firms surveyed say they have a records management policy. Yet, of that group, 31 percent report having a policy for paper documents but not for e-records. And perhaps most surprising of all, 28 percent of firms surveyed say they are either paperless or plan to be in five years—keeping some official paper records, but everything else used or kept in electronic format.
What’s the takeaway? Firms that take control of paper and electronic records can receive benefits such as:
- Giving their attorneys faster access to needed information to better serve their clients.
- Lowering costs by reducing the amount of office space needed to house records.
- Helping ensure their firm’s compliance with professional and regulatory rules on document retention.
Boost Your Firm’s E-fficiency
Efficiency weighs in as a top goal among law firms. So where do you begin? Of the surveyed firms, 67 percent are already boosting their efficiency with records policies that apply to both paper and electronic records. Simply by establishing and enforcing an information management policy, your firm can streamline and tighten the processes for handling records. Make sure that policy includes a retention schedule so you can better manage your information assets, lawyers can quickly find and access what they need, and your firm can gain cost efficiencies.
A well-established policy also enables firms to efficiently comply with federal regulatory requirements, such as HIPPA and HITECH, and the plethora of state regulations that cover records. Even if your firm isn’t mired in the intricacies of laws and regulations, chances are you still have to deal with IRS tax record requirements or those of the Occuptional Safety and Health Administration (OSHA), both of which apply to nearly all businesses.
Learn to Let It Go
The flip side of any document retention strategy is how and when to destroy firm or client files that you’re no longer required to keep. As with anything, there’s a right way and a wrong way to approach it—and of course, buy-in is essential.
This is no small point. The survey reports that 35 percent of the firms polled cite attorneys’ collective reluctance to destroy client files as the biggest obstacle to a destruction program. Another 15 percent point to a lack of consensus about the retention policy itself. And 12 percent say they simply don’t have the resources to review client files before destroying them.
Some law firms may need to adopt tighter best practices when they destroy and dispose of files, to better protect the firm and its clients. For example, only 42 percent of the firms surveyed by Iron Mountain use secure, vendor-supplied shredding containers to dispose of paper. A full 27 percent use simple retail shredders.
The problem with the latter strategy? The average store-bought shredder can’t render documents unreadable—a requirement of regulations like Massachusetts 93I and California 1798.81, which cover data privacy and breaches. What’s more alarming is that 19 percent of those surveyed use recycling bins, and 12 percent use waste cans.
Such vulnerabilities in your firm’s safety net can leave you and your clients at risk for costly data privacy breaches, not to mention malpractice exposure. A Ponemon Institute study found that companies suffering a data breach spent an average of $5.5 million to recover. Worse, your reputation could take a hit in the wake of a significant breach. And defending malpractice suits and paying out awards won’t make you and your insurance carrier happy campers.
It Pays to Add a Partner
Iron Mountain’s Law Firm Information Management Benchmark Report indicates that law firms are taking important steps to establish policies and practices to manage information. But you and your peers still have plenty of work to do. Plugging the gaps in your firm’s record management strategy may seem overwhelming—and it can be. Some firms may be better off teaming with a trusted partner with proven information management expertise. Its expert team can help you establish and execute records management policies and destruction and disposal plans that keep you within the bounds of legal, regulatory and ethical requirements.
Iron Mountain Suggests: Jump-Start Your Firm’s Information Management Program
Consider these approaches to bringing greater efficiencies to your firm’s information management practices:
- Leverage your paper records policy to create an electronic policy.
- Make sure that both your information management policy and practices address privacy requirements for client, employee and firm-sensitive data (such as human resources files and financial records).
- Implement a defensible destruction program to manage information volume and lower storage costs, even if it’s on a go-forward basis.
- Make sure your paper disposal methods protect sensitive client data while also meeting regulatory requirements.
Do you have more questions about your law firm’s options? Read additional Knowledge Center stories on this subject or contact Iron Mountain to learn more about services to address your information management challenges.
Law Firms: Ready to Kick Your Records Management Efficiency Up a Notch?
Law and Order: You Don’t Need to Choose
Smarter Retention and Safer Shredding Keys to Better Information Management