Overview
A myriad of technology options are available to help law departments manage their operations. As the technology market changes, there is an increasing number of technology solutions and vendors catering to the legal industry. Even for those law departments that have entered into legal technology solutions, the range of options may make it challenging to find the time to investigate and understand the implications and benefits of various options.The products encompass a broad array of legal functions, and often overlap in features.While it may be tempting to try to select one system that offers multiple functions, the key to successful utilization is to identify the law department's specific needs before selecting a system or systems. Although some available systems perform multiple functions, often it can be preferable to implement separate systems with functional strength in each area and integrate them appropriately, rather than trying to extend an individual system to perform the peripheral functions of which it offers capabilities. To best identify the type of system that may be needed, it is important to understand the underlying fundamental systems. This QuickCounsel provides a summary of several commonly overlapping technology systems -“ Document Management, Contract Management, Records Management and Knowledge Management Systems -“ and explains their similarities and differences, as well as how they interrelate.
Document Management Systems
Definition and Function:
A Document Management System supports the creation of a document (memo, letter, pleading, motion, filing, etc.), its retrieval,and its management.Document Management Systems are electronic document repositories that allow secure collaboration on content, including document editing/ownership via check-in/check-out, version tracking, and audit trails. There are specific legal-focused systems designed to support the functions of the legal department with, for example, heavy emphasis on features such as document assembly, templates, security, and email management. In the law department, document management systems can streamline document creation, leverage existing work product, facilitate collaboration in document drafting, and provide a central repository for storage, with secure access. Most importantly, document management systems support the search and retrieval of documents across the department, allowing active retrieval and re-use of exemplary documents.
Typical Lifecycle of the Process Encompassed by Document Management Systems:
Create or Leverage > Manage > Deliver/Search > Archive
- To "create" documents, the Document Management System usually interfaces with existing document-authoring applications such as MS Word, Adobe PDF, PowerPoint, or with scanning devices. In an ideal legal implementation, the Document Management System would automatically be interfaced with these key systems. This interface and usage is the case in most law firms, which almost always have document management systems. To "manage" documents, the system provides a repository for document storage with profiling (metadata such as name, author, document type, date, title, case, business unit, legal topic), version control, security access, check-in/check-out,an audit log, and ideally a full text index for most documents. To "deliver" documents, the system allows the end user to retrieve the document via searching, sharing, and collaboration features. The ability to search for documents across the department based on metadata or any portion of the document is particularly helpful to legal end users.
Similarities, Differences and Interrelationships among Systems:
- Document Management and Enterprise Content Management: In general, these two terms refer to the same type of system. Some vendors have adopted the term "content," as it is perceived to be more generic and it allows them to offer more functions in their product suites. Document Management and Record Management: The two system interact together to manage a business document across its useful life. Document Management systems allow management of a document from its inception, but lack the features of Records Management Systems that control its long-term retention and eventual disposition. See "What is Document Management."
Contract Management Systems
Definition and Function:
Contract Management Systems manage the complete life cycle of contract processes from creation through managing performance.Either the business unit or the legal department may sponsor contract management initiatives, but regardless of the sponsor, the legal department is a key player. Contract Management Systems allow business people to initiate contracts using content previously approved by the law department. See "Top Ten Innovations to Improve Enterprise-Wide Contract Management."
Typical Lifecycle
(Contract) Create and Negotiate > Store > Manage Compliance and Performance
- To "create/negotiate" a contract, the Contract Management System provides customized templates and clause libraries, typically pre-approved by the law department. It also facilitates collaboration with involved parties and negotiation through tracking workflow, tracking the changes and versions, and sending requests for review and tracking approvals. To "store" a contract, the system can house the contract document and the associated metadata such as contract dates, parties, key financial terms and clauses. After execution, To "manage compliance and performance," many Contract Management Systems have tools to monitor legal covenants and requirements. The performance management areas allow monitoring of the contract performance to the stated obligations and provide notifications when terms and/or key dates are met.
Similarities, Differences, and Interrelationships among Systems:
- Contract Management, Document Management and Records Management: These three systems can work in conjunction with one another. Contract Management System can store documents, but also capture information in a structured (field-based) manner. This allows easy reporting of fielded information such as parties, clauses, negotiation exchanges, execution, and post-execution performance. The Document Management System can be an appropriate storage site for the final contract document in readable form, for example, a PDF image of the fully executed contract. Once the contract is executed, the Records Management System will ensure that it is preserved during the course of contract's useful and regulatory life, and then disposed of. Contract Management and Knowledge Management: Contract Management Systems form a key part of the organization's and legal department's knowledge. The law department can use historical knowledge of contractual obligations, clauses and contracting party history to make informed decisions. Thus, it is important to integrate the Contract Management System with the Knowledge Management System.
Records Management Systems
Definition and Function:
Records Management Systems are designed to capture, organize, protect and provide ready access to all business records whether electronic or physical. For example, to enforce the business's approval and destruction rules and process, Records Management Systems can send to records owners or Records Managers notices such as requests for records disposal pursuant to the designated standards or retention schedule, and then track approval of these requests and records disposal, maintaining certificates of disposition for future reference. Other definitions can be found in "What Is Records Management? Why Do I Care?" and "What is Electronic Records Management?"
Typical Lifecycle:
Capture/Declare > Store and Retain > Access, Retrieve and Use >Dispose
- To "capture" records,Records Management Systems often have a variety of features, as records can be created electronically or in hard copy. Some documents are automatically declared as records as soon as they are created while others may be deemed records after they are explicitly "declared" through actions such as closing of a case or execution of a contract.The declaration is governed by the records retention schedule and corporate policies. To "store and retain" records, the system stores metadata and/or the actual record artifact,e.g., the actual pleading document. By storing key records, the system also supports business continuity measures. The system provides searching and viewing tools to "access, retrieve and use" records. Most systems enforce security and business rules for access and retrieval. To "dispose" of a record at the end of its retention life, the system enforces the corporation's approval and certification process for destruction.
Similarities, Differences, and Interrelationships among Systems:
- Records Management, Contract Management and Document Management: The Document and Contract Management Systems manage the document/contract and its associated information while it is "in-process," and the Records Management System takes over control once they are determined to be records. See "Technology in the Law Department: An overview of what you really need and why." The Records Management industry is now trending towards carrying the "manage-in-place" paradigm over from the physical to the electronic world. Thus, metadata may be stored in the Records Management System while the documents or contracts are kept in their native in-process areas, e.g., the Document Management System. Once the record declaration event happens, the Records Management System then starts governing the retention and access of that document until the time of disposition. These interrelated functions require the systems to be tightly interwoven so the records management function can be appropriately performed.
Knowledge Management Systems
Definition and Function:
Knowledge management as a discipline aims to improve collaboration across an organization; transform tacit knowledge (stored in the minds of individuals) into explicit knowledge (stored and documented physically or electronically),for example, by documenting standard procedures; and make sure intellectual as sets are readily accessible. While there are products on the market that are called Knowledge Management Systems, organizations' needs vary and there are a variety of different technologies that can be used as Knowledge Management Systems depending on the organization's focus. Knowledge Management Systems, whether denominated as such or not, usually rely on a combination of capturing technologies and presentation technologies, such as intranets, Document Management Systems, Records Management Systems, Matter Management Systems, data analytic dashboards, blogs, and many other technologies. For additional definitions see "IT Glossary."
Typical Lifecycle
Create/Capture > Manage and Transform >Share
- To "create or capture" information, systems such as Document, Contract and Records Management Systems are relied upon. Most information is created as a by-product of daily work such as preparing briefs, or through specific knowledge creation efforts such as creating contract templates. A Knowledge Management System collects this information and applies logic and business rules to categorize and code it for use. To "manage and transform" knowledge, the system's functions can incorporate knowledge governance aspects such as rules, policies, taxonomies and transformation logic in order to make the information available to meet the organization's particular purpose. To "share" the information,different systems have different methods of retrieval and presentation. The choice of system should be based on the need and audience. Some examples are blogs, intranets, federated searching tools, dashboards, and many others.
Similarities, Differences, and Interrelationships among Systems:
- Knowledge, Contracts, Document and Records Management Systems: All these systems contribute to the knowledge base of the organization. For example, a knowledge management system can assimilate a comprehensive business intelligence report about a client by leveraging information about the contractual obligations, documented research and recorded work-product residing in other systems. Knowledge Management and Document Management Systems: Document Management Systems are primarily designed to fulfill the legal department's need to capture and manage information. The users have to rely on their skill and knowledge of the system to retrieve the information. However, Knowledge Management Systems focus on extracting and presenting that information in a manner that is applicable to the user for the circumstances in which they will use it, for example, a financial dashboard tailored to provide an attorney the spend-to-date with a particular law firm.
Successful Implementation
Regardless of the systems selected, successful implementation requires the use of best practices. For more information about best practices, see "Law Department Technology: Planning, Installation, and Implementation."
Conclusion
While these management systems have similarities, each system has its own distinct purpose to fulfill when used by a law department. Some of the systems may stand on their own while others perform best when combined with one another. Law departments that develop a well-planned foundation of the right management systems will not only have the tools in place for effective management now, but will be in a better position to assess and meet their future needs.
Additional Resources
- "Technology in the Law Department - An overview of what you really need and why,"Robin Snasdell, Huron Legal "What is Document Management," AIIM "Automation: Document Management vs. Contract Management," Ashif Mawji, IACCM ," Duncan Jones and Patrick M. Connaughton, Oracle "Building a Business Case for a Contract Management Solution: Strategies for Securing Executive Sponsorship," Allen Pogorzelski, Neville Letzerich and Leslie Weller, IACCM "What Is Records Management? Why Do I Care?" ARMA "What is Electronic Records Management?" AIIM "IT Glossary," Gartner Inc.
