Migrated from eDJGroupInc.com. Author: Barry Murphy. Published: 2010-03-24 10:14:47Format, images and links may no longer function correctly. Despite the fact that few real standards exist in the eDiscovery market, I think we can finally put one argument to rest – corporations are taking eDiscovery in-house. The Fulbright’s Sixth Annual Litigation Trends Survey from Fulbright & Jaworksi showed that 48% of respondents are in-sourcing some eDiscovery activities in an effort to reduce costs. Another survey from Enterprise Strategy Group and Clearwell Systems also notes that 48% of respondents have active projects to in-source some eDiscovery activities and another 36% have plan to do so within the next 12 months.
At first glance, less than half of corporations indicating plans to in-source does not seem like a significant trend. But, in my experience, many of the respondents in these surveys (legal department folks, primarily) aren’t aware of all the activities underway in IT and don’t always realize that projects such as email archiving are almost always driven by eDiscovery. The other factor is that legal tends to think of eDiscovery more in terms of review and many legal departments continue to see review as a function of the law firm (which, in many cases, it is). That helps to explain why the numbers in these surveys aren’t larger. But, virtually anyone in-the-know will admit that more and more of eDiscovery is going in-house.
So, what does it mean to take eDiscovery in-house? The way I see it, the movement in-house consists of the acquisition of tools for information management, identification, collection, preservation, processing, and some element of review and analysis (the left side of the EDRM) and active participation in managing the cost of review. Now, this does not mean that taking eDiscovery activities “in-house” means that no external expertise is required or that all purchases will be of on-premise software. Rather, this points to a shift in how organizations manage eDiscovery.
I’ve got a real world example that puts the notion of “in-house” vs. “outsource” into perspective. I did some work with a Fortune 1000 organization that wanted to curb rising eDiscovery costs. After getting legal and IT on the same page (a GREAT first step, by the way), this organization chose to implement content archiving as a way to streamline identification, preservation, and collection. The archiving project covered email and file system content. This gave the organization in-house control over identifying, preserving, and collecting all email and file system content. In reality, there is way more content within the organization. In matters that extend beyond archived content, the organization brings in specialized expertise. In one case, they worked with a firm that specialized in backup tape restoration. In that sense, they are outsourcing some eDiscovery activities. However, I would argue that the organization has take in-house control of – and responsibility for – the eDiscovery process itself.
Not only did this organization move to in-source activities on the left side of the EDRM, but it also sought to better control the costs associated with review. This organization used the capabilities of its archiving platform to conduct a low level of early case assessment (ECA). Basically, after running searches through archived content, the organization would have a good sense of the amount of potentially responsive data and the potential cost of going forward with a case. Armed with this information, the organization could make decisions based on the economic impact of a matter.
This particular organization did not have a huge staff of internal litigators, so linear document review was a function provided by external law firms. This organization, in concert with its major law firm providers, chose an external eDiscovery service provider (or EDD service provider, if you like) that delivered a software-as-a-service (SaaS) review tool. Is this outsourcing? I some senses, yes, but in the more realistic sense, I would say no. This organization is maintaining control of the process and ownership of the process, while getting external expertise as needed. Both insourcing and outsourcing will be necessary in order for eDiscovery to be optimized.
My hope is that the in-source versus outsource argument will cool off and that organizations will realize that they need to put in place an infrastructure that allows them to efficiently manage information. Whether they buy on-premise software or use a third party to manage information, what’s crucial is to take responsibility for information management – they need to “in-house” ownership of the process. It’s no longer acceptable to simply ignore the problem and hope to place blame on others down the road.