The rise of data analytics in the legal world over the past decade has, perhaps, been inevitable. Legal tasks have always involved intensive data gathering and analysis of facts, while the world as a whole is becoming more digital at a rapid pace — allowing for advanced analysis of information that previously could only been done in books or on paper.

As a result, law firms are employing analytics in a variety of ways: Some are outward-facing, including developing facts to achieve client objectives in areas such as litigation, investigations, mergers and acquisitions. Other use cases are inward-facing, including using data to help law firms understand how they put together legal products and services.

The most forward-thinking and competitive law firms are developing an analytics strategy in a way that makes sense for their position in the market and where they want to go, says Bennett Borden, chief data scientist at Drinker Biddle & Reath. “Law firms that know how to use data analytics to achieve client objectives will simply be better than those who do not.”

These days, in order to succeed in a competitive landscape, all firms need should be boosting their use of data analytics, agrees Duc Chu, technology and innovation officer at Holland & Hart. “Firms that do not keep pace with the analytics of this data risk falling behind competitors,” he says.

A data analytics strategy is most commonly developed within the administrative functions of the firm, explains Borden. “However, until data analytics drives revenue generation it will never have the impact that it should within a law firm,” he cautions.

Not surprisingly, then, the first area ripe for expanding analytics efforts falls into financial data, Chu explains. “Time keeping, revenue, costs, and effectiveness are generally the first areas firms examine when moving to a data-driven model, since these directly impact a firm's bottom line,” he says, adding that this is often the easiest way to get buy-in to expand the use of data analytics.

Borden agrees, adding that those who are spearheading the effort to boost data analytics should first understand what data analytics can do and how law firms may need to change their processes or models to reflect the possibility of increased efficiency and accuracy through analytics. “You have to be nimble enough to change your revenue model so that you're capturing value.”

Getting out of the starting blocks for data analytics is already daunting for many firms, says Chu. “Most firms do not have the technical expertise to build analytic solutions internally, yet trusting an external vendor is worrisome given the cost and sensitivity of the data.”

When it comes to expanding the use of analytics successfully, however, there are other challenges law firms need to overcome. For instance, most law firms are dependent on Commercial off-the-shelf (COTS) software and interconnecting the data from these disparate sources and vendors is one of the major obstacles to advancing complex analytics, says Chu.

According to Borden, the biggest obstacle is that those who understand data science usually don't understand the problems that need to be solved, and those who understand the problems don't understand what data science can do. “Somehow you've got to get people in the room who understand both the data science and the problems you're trying to overcome or the objectives you're trying to achieve.”

In addition, he believes most firms fall short by trying to do too much at once. “At our firm, we chose to focus on developing a data analytics strategy in specific areas that related directly to revenue generation,” he says. “This allowed us to have some quick wins and some clear metrics showing immediate success, which allowed us to get more buy-in for more complex projects.”

The good news? Data analytics tools are maturing and becoming more accessible to law firm users who are not data scientists, Borden says. “There are some really interesting tools coming into the legal space that firms can employ without developing a whole bench of data scientists,” he explains. “Some of these give you insight into market, industry, and regulatory trends, while others give you insight into lawyers, courts and judges, or give improvements into legal research.”

If you're looking to boost your use of data analytics, Borden recommends tasking a group to stay abreast of these trends. “Firms should task folks to keep an eye on tools that are constantly being developed,” he says. “They can determine whether they might help them create a better legal product or service or distinguish them in the market.”

Sharon Goldman has been covering B2B technology topics for more than 10 years, including for publications such as CIO.com, Adweek, Digital Insurance, Shopper Marketing and DMNews.