Exponential Growth—The Data Explosion and Resulting Challenges and Opportunities for Law Firms, Part 2

By Joseph Raczynski

Over the course of the next several years I predict that many law firms will begin hiring data scientist. In my previous post Exponential Growth – The Data Explosion and Resulting Challenges and Opportunities for Law Firms, Part 1 I discussed how our current data explosion threatens experts at law firms but could yield vast opportunities. Recently Robin Grosset, Distinguished Engineer and Lead Architect at IBM Watson Analytics, described the importance of having a data scientist in your business. Underlining this point, he stated that in the United States there will be three-times the positions available in this field than can be filled.

How firms turn the big data challenge into opportunity

Why should law firms invest in a data scientist? Firms sit atop of massive quantities of very important specialized and typically siloed data. Grosset mentioned that a recent Mckinsey & Company report showed a firm could increase its operating margins by 60% by using the data they have currently. With the exponential growth of data, law firms will need to decipher it into understandable bits so they can make actionable decisions and find opportunity.

How could this be accomplished? In the past we know that eDiscovery practices utilized computer learning and analytics to create efficiency for large cases. As law firms continue to utilize flat fees as they seek out business, they will increasingly need to take advantage of analytics-based tools with a layer of human interaction. The human interaction is a piece that allows you, the expert, to ask simple or insightful questions for which the tool will serve up answers. Those intuitive results rest upon the underlining data which can be drilled into for greater understanding. The core piece to this human-level interaction is Semantic Analysis. In essence it adds meaning to data. That is, it creates data clues like data type, patterns, range density, sample values, and correlations. You essentially have a massive set of rules that are bundled together and sift through the data, eventually learning on its own and creating new interpretations of what lies within the data.

Why would a law firm use this? Business development, client retention, analysis of lawyer productivity, assessing resource allocation and a myriad of other untapped areas will be explored using a data scientist. With the ability to process massive quantities of information and find the white space, real opportunity will be found by those that go down this road. In fact, the analysis that IBM Watson puts forth states that most firms estimate that they only analyze 12% of their data currently and that 88% is left on the on the dark-grained, bamboo-laden law firm floor.

Ultimately, the exponential growth of data is currently creating challenges for some law firms. What will be fascinating over the years ahead is who will seize on this evolving opportunity and how will they approach it.

Exponential Growth – The Data Explosion and Resulting Challenges and Opportunities for Law Firms, Part 1

By Joseph Raczynski

We are currently living in the hockey stick portion of explosive data growth. That is, 90% of data humans amassed has been collected during the past two years. According to IBM Watson, this is gathering speed exponentially such that 2.5 billion gigabytes of new data is generated every day and the majority of this is unstructured. Simply stated, the numbers are massive and the data is not organized—and this impacts all businesses, but increasingly is a challenge to law firms.

True expertise is fading without computer learning tools

Recently I had the opportunity to watch Robin Grosset, Distinguished Engineer and Lead Architect at IBM Watson Analytics steer an entertaining and provocative discuss around data analytics. His focus was on how big data can impact expertise and how cognitive analysis or computer learning can meet this massive data challenge and build abundant opportunity.

True human expertise is at a crossroads. No one person can possibly absorb the vast quantity of data that is being produced in various disciplines. Traditionally in the eDiscovery space, firms hired first-years out of law school to review and classify thousands of documents for a case. Now, in many instances, data has ballooned well beyond what a team of attorneys can handle. Expertise is lost among the data. Audio, video, pictures, database information and social media are increasingly in profusion around cases to be analyzed. The ability to be an expert with a complete understanding of a case is nearly impossible now without the proper tools.

The solution to this dilemma of data and expertise is to wrap instruments that interpret and understand this data around the information. With cognitive computing it begins by dealing with the volume, variety and velocity of the data. Once that is understood, the real key is adding a human intuitive interface on top of that massive data-crunching, cloud-processing power. This aspect is the edge of where this field is headed currently. It then allows an expert to unearth the data through analytics and their own analysis. Firms can then sort through the mountain of information to understand and interpret trends and more importantly find white space. Now the expert can reclaim their seat, and from this challenge start to seek out opportunities for their firm.

In the next part of this series I will focus on how law firms can turn the big data challenge into opportunity.