money circles

Law firms are constantly being asked to do more with less, and this is particularly true of their IT departments. The year 2018 saw most law firm IT departments overworked and stretched to their full capacity. The problem is that law firms simply don't have the IT headcount necessary to accomplish all the tasks needed to support their internal clients. IT staff who are responsible for the firm's most crucial operations are also being asked to work overnight doing patching, support and other commodity work. The unsurprising result is that the staff are rapidly experiencing burnout.

A key goal for law firms when it comes to planning and budgeting for 2019 should be to figure out ways to make their internal IT staff more productive without overworking them. Due in large part to justifiably increased concerns about cybersecurity, law firm IT departments have become 24/7/365 operations. Current staff always need to be ahead of the possible threats. Already-lean IT departments are now asked to juggle critical projects, strategy and day-to-day maintenance without any additional help.

The challenge for CIOs going into 2019 is to find a way to retain their best IT talent, particularly security talent, without stretching them too thin. The solution lies in budgeting. Firms will find success by budgeting for more migration to the cloud and the training of internal IT staff on more high-value-add work, while smart-sourcing commodity IT functions to trusted partners and vendors.

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Three Key Budgeting Considerations for 2019

Freeing up internal IT teams to focus on high-value work may seem like a daunting task, but there are three major strategies law firms can implement in the coming year to make it possible.

1. Make the Move to the Cloud

Many law firms still have a good deal of hardware and software on-premises. Shifting the IT infrastructure to the cloud can gain a firm exponentially more IT capacity for the same amount of money. SaaS providers are constantly increasing their offerings, reducing the need to invest in on-premises tools. Any firm looking to cut costs while boosting efficiency should include a cloud migration plan in its 2019 budget. Figuring out how to partner with vendors who specialize in cloud technologies can make the migration process easier and help ensure the firm is getting the most possible capacity for its spend.

2. Budget for New Hires but Spend the Money Externally

Smart-sourcing isn't necessarily about saving money, but rather about maximizing the productivity return on the firm's IT budget. Law firm CIOs seeking to maximize returns should be looking to partner with a trusted third party. By budgeting for the hire of one or two full-time employees but using that money to smart-source commodity IT work to a vendor rather than on internal hires, the firm will succeed in the goal of accomplishing more with less.

The money that would be spent on these full-time internal hires can buy a firm much larger capacity through managed services. In addition to more work capacity, the department also gains access to a broader range of expertise and the ability to handle more types of work, all for the same amount of money.

3. Smart-Source Security

Security experts are some of the most difficult professionals to retain at law firms. Security professionals are in high demand in the current market, meaning that they tend to not stay at any one law firm for very long and demand large salaries while they're there. Because these employees are so hard to hold on to, CIOs should consider smart-sourcing their security functions, if not outsourcing them entirely. When firms turn to trusted third parties to handle their security needs, the money budgeted for security goes much further and brings much greater value to the firm. It also eliminates the need to replace and retain internal security staff on a regular basis.

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Further Considerations

Determine Where Time Is Being Spent

The only way to truly maximize the IT staff's time is to first figure out what it is they're currently spending it on. Most IT departments keep track of their hours just like lawyers do, which makes it easy to run analytics to determine what functions and categories of tasks they're handling. Many firms find that a large portion of their IT staff's time is being spent on commodity work like patching or handling phone issues. On top of the long hours expended on that lower-level work, those same employees are also expected to manage important projects and oversee the development of new products and innovations. Too often, the time demands of the commodity work are taking qualified staff away from those more important functions.

Firms that don't currently capture their IT staff's time need to start. Without actual time tracking, departments leaders are left with nothing more than intuition to judge how time is being spent, and intuition is never an accurate indicator. Knowing definitively will help determine how to more wisely use that time.

Invest in People

Supporting innovation in a law firm goes beyond just investing in technology – the firm also needs to invest in its staff. The purpose of smart-sourcing is not to reduce headcount, but to improve the strategic deployment of internal IT staff. Once their time is freed up by the commodity work being moved off their desks and shifted to outside the firm, the next step is to fully equip them to do the higher-value work.

Training is key. Law firms are increasingly becoming more application-centric, and an expanding amount of online trainings and seminars is available to get IT staff up to speed. When budgeting for 2019, CIOs need to go beyond just planning for technology and include budgeting for training and investing in their employees. A successful IT department is measured by the caliber of its people. In today's competitive market, firms are more likely to retain their best and most in-demand IT staff by training them and allowing them the opportunity to grow in their careers.

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The Takeaway

In the coming year, law firms will continue to be asked to do more with less. Strategic IT budgeting for 2019 can play a crucial role in making that possible. By budgeting for the smart-sourcing of commodity and security work, migration to the cloud and the training of internal staff, law firms will be well positioned to retain top talent and avoid IT staff burnout.

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Arup Das is CEO of Alphaserve Technologies. He is an expert in institutional level technology governance and operational risk management standards that are prevalent in hedge funds, private equity funds, venture capital funds and global law firms. Mr. Das regularly writes and speaks for legal and other audiences on topics related to digital transformation. In 2018 he received the International Legal Technology Association's Thought Leader of the Year award for his expertise and commitment to sharing his knowledge and insights about critical technologies and trends impacting the legal market, including artificial intelligence, data science and analytics, blockchain, development operations, automation and innovation.