Practice Management in the Cloud

Practice Management in the Cloud 2012 Wisconsin Solo & Small Firm Conference October 25-27, 2012 Chula Vista Resort, Wisconsin Dells, WI Atty Nerino J. Petro, Jr. Practice Management Advisor State Bar of Wisconsin

INTRODUCTION....1 TAKE ME TO THE CLOUD!...2 WHY DO PEOPLE KEEP PUSHING PRACTICE MANAGEMENT TOOLS?...3 A. LACK OF DILIGENCE...4 B. FAILURE TO COMMUNICATE...4 C. CONFLICTS OF INTEREST...5 WHAT DO THESE TOOLS DO?...6 WHAT ARE YOUR OPTIONS!...7 D. CLOUD BASED PRODUCTS:...8 E. HYBRID PRODUCTS:... 10 F. HOSTED:... 10 CONCLUSION.... 12

Introduction. Practice management tools are a terrific tool for any size legal practice. Legal practice management software puts critical information regarding your practice including client and case information, information for other parties, events, email and to do items as well as documents, notes and even time and billing at your fingertips. However, up until recently (about five years ago), lawyers could only choose practice management software that installed directly to a desktop computer. Products for solo and small firms included LexisNexis TimeMatters, Software Technology Incorporated s PracticeMaster, Gavel & Gown s Amicus Attorney, West s ProLaw and Abacus Data System s AbacusLaw to name just a few. These were great products, but the legal practice management software industry underwent significant change when West and LexisNexis purchased major players in this market space. While these purchases gave their respective products significant infusions of money for research and new features, it also resulted in significant price increases as the development and maintenance costs increased for these companies. By about 2008, the desktop practice management software available had become feature rich, some say feature bloated, with the complexity of the software increasing to the point that firms attempting deployment without the help of a consultant often ran the risk of having their investment fail. By listening to their users requests over the years, the software companies had arrived at a point where they could adapt to pretty much any type of practice and provide all of the bells and whistles that users had requested. Unfortunately, what was a must have feature for one office, was considered to be worthless by another and unnecessary. As new features were added to the ones before, these practice management packages become more complex and difficult to use. Users might now have to open multiple windows or drill through multiple levels of information to get to something basic. For new solos and even existing solos and small Page 1 of 12

firms without the need to have one product do everything, a demand arose for a product that was simpler to use, could be accessed from multiple computing platforms (e.g. Windows, Mac and Linux while looking and working the same on anyone of them) that contained the core features an office needed but one that also allowed access from more locations than just the office. Thus, was cloud based practice management software born. This changed a few years ago with the introduction of the first cloudbased practice management products. We ve all heard of cloud computing by now but what does that really mean? Take me to the Cloud! Use the phrase "cloud computing" in a group and you will get as many definitions as there are people in the room. Some ascribe cloud computing to delivering Software as a Service ("SaaS") wherein all users of that service or product access the same tools sharing a common interface and providing little or no customization capabilities. One example of this would be any of the free e-mail services such as Gmail, Hotmail or Yahoo! Mail. While you can generally change the appearance of move columns around every user shares very much the same interface with little ability to provide a significant customization to the service. These services will be referred to throughout this paper as SaaS products. Others describe cloud computing as any service or product outside your firewall delivered across the Internet including traditional off-site or remote hosting of applications and data. An example of hosted services would be buying copy of Microsoft s Exchange e-mail server but rather than installing it on a server in your office, you have a company in the Internet install it on one of their servers. You have full control over the features and settings in the product and share it with no one other Page 2 of 12

than those in your office. These products will be referred to throughout this paper as Hosted products. Here s a plain English definition that seems to work best for most people: Cloud computing is a fancy way of saying stuff s not on your computer. It s on the Internet and there for you to access whenever you want it. 1 For our purposes, we are going to cover products that are entirely cloud based, as well as those you access across the cloud and even a third category a hybrid model that has a foot in both the desktop and internet worlds. Why do people keep pushing Practice Management Tools? So you don t become a malpractice statistic! In fiscal year 2010-2011, the OLR received 2,377 inquiries and grievances representing an increase of 70 more inquiries and grievances than the prior reporting year. 2 Of the various grievance classifications listed in the annual report, many are of a personal nature that no amount of technology can overcome or be used to prevent. However, there are several classifications that are perennially in the top ten grievance areas, year after year. In 2010-2011 the top grievance area was Lack of Diligence at 22.76% of all complaints. At number three was Lack of Communication with a client at 9.71% and finally, in seventh place on the chart was Conflict of Interest in its various iterations at 5.22%. Each of these areas can be reduced or eliminated by the proper use of technology, specifically, practice management software. 1 Credit for Cloud computing is a fancy way of saying stuff s not on your computer belongs to Quinn Norton of MaximumPC where she used that phrase in her Byte Rights, article from September 2010. 2 OLR Annual Report Fiscal Year 2010-2011 http://bit.ly/qkx86j Page 3 of 12

A. Lack of Diligence While it s great to be in the number one category in some lists, falling into this one isn t one where you want to be a member. Diligence (or the lack thereof) retained its first place position in the 2010-2011 Annual Report for greatest number of complaints. There are very few things worse than waking up at 3:00 AM and wondering if you missed a filing or other deadline. Blowing a Statute of Limitations date isn t just a worry; it can also result in major damage to your practice as you are exposing yourself to a malpractice claim as well disciplinary proceedings by OLR with the associated potential of the loss of your license. But lack of diligence can also take other forms as well; including neglecting the client s file. As lawyers become busier, it becomes easier to overlook and to lose files. Many lawyers can t easily determine how long it s been since any work was done on a specific file even if it s just a simple status letter to the client or checking the status of an underlying case or topic. This issue should not be taken lightly, especially in light of the fact it was number two on the list of complaints investigated by OLR. Practice management tools provide you with the ability to take your paper tickler system put it on your computers making it available to everyone in the office and to generate reports (either on screen or printed). It also helps prevent neglected files which is another area of concern when it comes to Lack of Diligence, especially as attorneys handle more and more cases. Practice management tools can generate warnings and reports based on file inactivity i.e. more than X number of days has passed without any action being taken on a particular file. You can include related records such as calendar entries, documents and more. B. Failure to Communicate What we've got here is failure to communicate. Captain, Cool Hand Luke (1967) Page 4 of 12

Holding steady in the third place position is Failure to Communicate. Failing to keep your clients informed can quickly sour an otherwise helpful and successful client representation. Surveys of clients have shown that while they may have received adequate legal representation, they are extremely unhappy with their attorneys failure to return phone calls, failure to keep them updated on a regular basis and failure to provide them with timely and adequate communications regarding their matter or case. To put this in perspective, think about a doctor who has a poor bedside manner you may receive terrific medical advice, but you re not happy with the information (or lack of it) that you get and even though everything came out alright, you are dissatisfied with your treatment. Now, change this from a doctor to an attorney who doesn t return phone calls, send letters or keep the client up to date; clearly attorneys need to focus on keeping their clients informed and maintaining the flow of information on a continual basis to avoid the same results as the doctor. Failing to keep your clients informed can quickly sour an otherwise helpful and successful client representation. Practice management tools can help you be proactive in communicating with clients. Wouldn t it be nice if you received a reminder to send out a status report on a specific matter? Practice management tools can do this and more C. Conflicts of Interest When attorneys start practicing law, it is easy to remember who was involved in cases as they may only have a small number of cases. However, over time, it is impossible to remember every party involved in every case by memory alone. For years, the ubiquitous client and opposing party card file systems have been used by law office large and small to perform their conflict checks. But even this isn t enough anymore with the proliferation of corporations and limited liability companies and their shareholders/directors/offices/members. But there is more to a conflict of interest than representing two different parties that have adverse interests; there is also the situation Page 5 of 12

of attorneys entering into business transactions with clients or failing to disclose conflicts that the attorney may have due to a preexisting relationship. With a Practice management tools you can run a global search to see if the names or parties return a hit to allow you to decide to proceed with a full office search or to see if there are any hits and to confirm whether or not that hit is an actual conflict. When it comes to determining if a conflict exists, we can look to In Re Cooperman 633 N.E.3d 1069 (1994) for the New York Court of Appeals for guidance: The conduct of attorneys is not measured by how close to the edge of thin ice they skate. The measure of an attorney's conduct is not how much clarity can be squeezed out of the strict letter of the law, but how much honor can be poured into the generous spirit of lawyer-client relationships. The "punctilio of an honor most high" (Meinhard v Salmon, 249 NY, supra, at 464) must be the prevailing standard. Unfortunately, too many attorneys ignore this advice and constantly try to see how close to the edge of the thin ice they can skate. So these three grievance classifications ( and they are in the top 10 of grievances filed) represent more than 37% of all grievances filed are the ones that Practice management tools, properly implemented can help you with. You can significantly reduce or even eliminate the malpractice threats of more than one-third of the potential grievance risks they pose and help you keep a good relationship with your clients. What do these tools do? Ideally, these products or services allow you to access your tools and data from any location where you have a broadband Internet connection. Solos and small law firms are using these tools to connect all of their users and staff whether located in a single office or geographically dispersed locations. For our purposes, probably the biggest Page 6 of 12

difference between true SaaS products and services vs. Hosted products and services is whether it involves a desktop tool that allows you to work off-line without an Internet connection. Today, cloud-based practice management tools are available from a number of different vendors providing different levels of content and flexibility. In the solo and small firm environment, two of the first SaaS products are Clio (www.goclio.com ) and RocketMatter (www.rocketmatter.com ). However, these two services no longer have the cloud-based practice management arena to themselves: new competitors have entered the market space in the last 12 to 24 months and cloud-based practice management solutions are available for offices as small as a solo attorney with no staff to firms numbering 50 or more attorneys and staff. At a minimum, solid practice management tools need to provide you with the ability to keep contacts, calendars and to-do lists as well as cases/matters, track time, add notes, track and bill time and ideally link to documents while simultaneously keeping all of these items associated to the relevant client and matter. But why is the ability to do all of these things critical to a law practice many lawyers ask? They may be using a number of programs that keep much of this information just in different places i.e. contact information, calendar events and To Do items in Outlook; notes, telephone call records and the like in q word processing document; time entries in Excel, so why spend the money on practice management tools? What are your Options! So what are your options today when it comes to SaaS, Hosted and other practice management tools? 3 3 For a more complete comparison of many traditional and cloud based practice management tools, see the chart on the ABA Law Practice management s website at http://bit.ly/suulye Page 7 of 12

Here is a list of many of the cloud-based solution providers whose products include most, if not all, of the basic requirements. As a note, this list is extensive, but by no means exhaustive and failing to note any provider or service is not intentional. D. Cloud Based Products: Clio (www.goclio.com ). Clio is a cloud-based practice management product which provides the ability to maintain contacts, matters, calendars and to-do items, time and billing as well as the ability to store unlimited documents online using Clio's integrated service as well as sharing these documents with clients through Clio Connect. Clio integrates with popular e-mail programs as well as allowing synchronization with Outlook and off-line access to calendars contacts and tasks. Clio also integrates with Google apps. Price per month is $49 per attorney and $25 per staff member. RocketMatter (www.rocketmatter.com ). RocketMatter is a cloud-based practice management product which provides the ability to maintain contacts, matters, calendars and to-do items and time and billing. RocketMatter includes the ability to synchronize with Dropbox as well as its own unlimited document storage. RocketMatter also allows export of data for use in pipe work on a program such as QuickBooks and Peachtree accounting. RocketMatter pricing varies depending on the number of users and length of commitment chosen starting at: $59 for the first user and $49 for users 2-6. LexisNexis Firm Manager (www.firmmanager.com ). Firm Manager is the cloudbased practice management product from LEXISNEXIS owner of both TimeMatters and PCLaw. Firm Manager includes the ability to customize templates for specific practice areas and provides integration and synchronization with Outlook 2007 & 2010. You can save emails and attachments to Firm Manager directly from inside Outlook 2007/2010. Firm Page 8 of 12

Manager allows you to grant online access to your clients for tasks, appointments and documents. However, Firm Manager does not currently provide time and billing capabilities. Pricing is currently $49.99 per month per user. MyCase (www.mycaseinc.com ). MyCase s tagline is "Social Practice Management. Integrating concepts found in the social networking world such as Facebook like commenting streams, instant messaging and automated responses, MyCase includes the ability to provide your clients online access to their information as well as providing core practice management tools including unlimited online document storage.. Pricing per month is currently at $39 per attorney and $29 per staff member. Adovologix (www.advologix.com). AdvologixPM is built on the same platform as Salesforce.com and claims your core business management software can NOT do what AdvologixPM does for you. On its face, this appears to be quite a claim; however, when you start checking into the feature set of AdvologixPM, you find it extremely rich feature set including document automation. According to its website, AdvologixPM integrates with Outlook and Google apps, as well as NetDocuments and Box.net; Quick Books, Google, Yahoo, LinkedIn, Drawloop Document and Form Automation, and Microsoft Office solutions. You must call for pricing. GoMatters (www.gomatters.com). GoMatters appears to offer many of the same features as Clio, RocketMatter and MyCase. One feature that GoMatters claims to offer is very tight integration with iphone contacts in multiple fields. Pricing structure is a bit different than the others with pricing for 1 to 3 users at $50 per month or $360 annually. Additional pricing is available on their website. Page 9 of 12

E. Hybrid Products: Credenza Pro (www.credenzasoft.com). Credenza Pro is what many refer to as a "hybrid" practice management product. The reason for this is that it integrates with Microsoft Outlook and resides on your local machine while other parts reside in the cloud. The cloud portion does not truly come into play until you have more than one user; but when you do, you create a central database for calendaring, email and documents on a secure server. You also have the choice of keeping your documents locally or on this online server. The downside to this hybrid approach course is the fact that you will need to have a computer running Outlook and Credenza Pro to access your online information. Credenza Pro will continue to run locally but you will not be able to see any changes or documents added by any of your team members. This means that in order to access your information you will need to have a computer with Outlook in your user account available. Credenza Pro is priced at $24.95 per month per user. F. Hosted: As discussed earlier, Hosted products differ from products based on the Software as a Service model. Hosted applications are desktop software installed on someone else s computers and run from the cloud-based server across the Internet. Access is usually through a variety of services such as Citrix, Microsoft terminal server or others, but unlike SaaS products, these Hosted practice management packages have 100% of the functionality of the desktop based software since that is exactly what it is desktop based software that you are running from an Internet connection software as is if installed on your local desktop. Yet another option is a process called Virtualization Desktop Infrastructure ( VDI ); however, for our purposes it is most commonly referred to simply as virtualization of the desktop. VDI is a process that separates the Page 10 of 12

personal computer desktop from a physical machine, allowing a user to login to their familiar Windows desktop from anywhere they have a broadband Internet connection on a device with a fully functional web browser. This means that you can access all of your desktop applications from your ipad or Android tablet, a netbook or notebook or even a desktop computer. If you are disconnected from your desktop for some reason, there's no need to worry as your desktop is on a remote server and is not affected; all you need to do is log back in and resume from your last point. In addition to practice management software, virtualization providers in the legal market also include the ability to use a program such as QuickBooks, Timeslips and Microsoft Office. Due to licensing constraints imposed by the software manufacturers, you may have to work out purchase terms with the virtualization provider. Legal Workspace (legal-workspace.com). Legal Workspace was one of the first desktop virtualization providers for the legal market segment. Currently, legal workspace offers Amicus Attorney for practice management, QuickBooks for accounting, Timeslips for time and billing, WORLDOX for document management as well as Microsoft Office and even hosted Exchange for e-mail. Pricing varies on the software you select to run on your desktop so for more information you will need to contact Legal Workspace. When LegalWorkspace was last demonstrated for Nerino Petro the price was stated as $99.oo per user per month for the base product. Legal specific software packages were in addition to that price Duncanllc (http://duncanllc.com/ ). Duncanllc s Cumulus is the name for this company s product, of which there are several bundles of pre-selected applications as well as having the ability to customize what is delivered based on the users exact needs. According to duncanllc, there most requested Page 11 of 12

bundle is the Cumulus Core bundle which consists of a Microsoft Exchange Mailbox, Microsoft Outlook 2010, Microsoft SharePoint, Microsoft Web Access, Spam Filtering, Tablet & Smart-Phone Access to Cloud Data and 50GB Shared File Storage (50 GB Network Drive). Their Premium Bundle Cumulus Office in the Cloud - adds Windows desktop on any device, Full Microsoft Office 2012, tablet and smartphone access to cloud data, weekly disaster recovery backup and automatic patch installation. The smaller bundle is $49.99 per user per month and the Premium bundle is $99.00 per user per month. Ala carte products pricing varies. To date, duncanllc has deployed Amicus to attorneys in addition to MS Office applications. CoreVault IaaS (www.caorevault.com ). CoreVault s IaaS (Infrastructure as a Service) allows you to create your own data center on their servers. With CoreVault, you receive your own virtual server and can quickly add users, software and storage. Base pricing starts at $189.00 per month with a per user charge of $7.00 per month added to that. So rather than paying per user, you start by paying for the server. You can get MS Office and you can also install any software that you wish to purchase directly or that CoreVault can provide for you. Conclusion. Today, solo and small firms have more choices than at any other time in the last twentyfive years when it comes to affordable practice management tools. Whether you select a desktop, SaaS, Hosted or Hybrid solution, practice management is a tool that every lawyer and law firm needs to have. Page 12 of 12