Harford County Bar Association February 9, 2005 Technology to Start and Run a Law Practice

1. Harford County Bar AssociationFebruary 9, 2005Technology to Start andRun a Law Practice Presented by: Robert S. McNeill, J.D. The McNeill Group, Ltd. Bob@McNeillGroup.org 301-502-7209

2. Technology to Start and Runa Solo Practice • What do you need to practice law as efficiently and productively as possible, while providing the highest possibly quality legal services to your clients? • The perfect law practice management system for you depends on your needs, the available technology, and your budget. • A law practice management system is the sum total of your personnel, procedures, computer equipment, and software programs; the integration between them; and how well they are run in real life.

3. Issues to Consider(Needs Analysis): • What type of law will you be practicing, e.g., does your practice require generating form documents or will you prepare mostly customized documents? • How much do you know about technology (and how much do you want to learn), i.e, how much do you want to leverage technology to do your work; do you want to do it yourself or outsource it? • What programs are you comfortable with now? • What equipment and programs do you currently have? • Will you be sharing an office with an existing system you can use? • How mobile do you want to be? • What is your budget? • “What do you want to be able to do?” will dictate what you need to do it.

4. Lawyers Need to: • Communicate with clients and others: • Phone, documents, fax, e-mail. • Create documents: • Letters, pleadings, etc. • Track time and bill clients. • No one pays without a bill. • Manage their practices (juggling all of the balls): • Meet deadlines, avoid malpractice. • Work efficiently. • Avoid working themselves to death. • Manage their finances: • Write checks, keep accounting records, generate financial reports to determine if you are earning what you want or need.

5. Communications • Evolving to the point where you can communicate with anyone at anytime from anywhere. (Whether this is a good thing or not is another issue.) • Mobile phones. • E-mail ubiquity. • Send/receive faxes by e-mail. • Hand-held devices that are part phone, part computer, part Web appliance. • How much communication do you want and need? • Can you market yourself as the “available lawyer”?

6. Communicationsso that you can return every call within 24 hours • Office telephone system: • How many people will be using a telephone line at the same time = minimum number of lines. • Use telephone company services instead of answering machine to avoid busy signals; provide voice mail, conferencing, call forwarding, caller ID, and call waiting (ugh!); and avoid up-front capital costs. • Digital Subscriber Line for both voice and data available in your area? • Telephone with good quality speaker and headset jack. • Cordless phones: security issues. • Mobile phone with voice mail and pager, integrated with office system (call forwarding). • E-mail and Web access now available on mobile phones.

7. Unless you receive few faxes, you need a fax machine even if you have fax capability on your computer to fax documents that are not stored on your computer and to keep incoming junk faxes off your computer. Must be plain paper. If you are sharing space, make certain the fax machine can have your signature. If not, get your own machine. For light duty environments, consider an all-in-one printer/fax/scanner/copier. Recommend laser instead of ink jet for print quality. High quality output is needed more in a law office than color. Faxing

8. “Personal copiers” available for under $500, but the real cost includes the time it takes to make the copies (page per minute and document handling capabilities). Copier designed for office use will have a longer life, and may be less expensive in the long run. Get the maintenance agreement so you can call in the experts when it doesn’t work. Avoid copiers that do not offer maintenance and loaner equipment (how much will it cost you to get it fixed in time and money?) Recommend a document feeder to save time, and collating if need to create many sets of documents. Outsource big jobs, and know the location of the nearest 24-hour Kinko’s for emergencies. Photocopiers

9. Law Practice Management System Programs • Office productivity suite with word processor. • Document assembly. • Document management. • Time and billing. • Accounting. • Contact manager/”Rolodex®”. • Case/Matter management. • Calendar, diary, and docket control. • E-mail. • Web browser. • Substantive law. No other businesses require such a diverse range of applications

10. Office Productivity Suites • Microsoft Office 2003. • Corel WordPerfect Office 12.

11. Office Productivity Suites • Microsoft Office 2003 • Word word processor. • Excel spreadsheet. • Power Point presentations. • Access database (not in all packages). • Best selling (not necessarily the best or the best for you). • Most clients will have Word for easy document exchange. • Poor conversion from/to WordPerfect.

12. Office Productivity Suites • Corel WordPerfect Office 12. • WordPerfect word processor. • Quattro Pro spreadsheet. • Presentations (presentations). • Paradox database (not in all packages). • packages). • Traditionally used by lawyers (70%?); Law Office Computing award; many lawyers will have for less problems sharing documents. • Easier to use for long-time WordPerfect users (reveal codes, keyboard short-cuts, and compatibility with documents created in older versions, e.g., forms bank). • Good conversion from/to with Word.

13. Document Assembly • Will you be doing most of the document creation? • How well do you type? • What type of documents do you need to prepare? • Type entire document every time? • “Manual” or traditional document assembly: • “Cut and paste” from existing documents. • Organize into forms folders.

14. More EfficientDocument Assembly • Automate the replacement of “variables,” e.g., client’s name, with a merge program: • Word or WordPerfect merge. • HotDocs document assembly program and Word or WordPerfect – www.capsoft.com. • Automate the insertion of clauses with rules, e.g., “if client is female, make pronoun gender feminine.” • Eliminate entry of variables that are already in the system, e.g., client’s name is already in the billing program. • Automate creation of document based on rules, e.g., “when enter new client in billing system create a retainer agreement.” • Make document assembly system voice-enabled. • Methods listed above are in increasing order of complexity and efficiency: the more routine a document is the more efficient you should be in creating it, e.g., retainer agreement is prepared for every client, should be a no- brainer to create it.

15. Document Management • How to store and retrieve documents. • Client documents. • Form documents. • Administrative documents. • Document security in multi-user environment. • Recommend \docs\client\matter\long_file_name naming convention similar to paper file organization. • For multi-user collaborative practices, consider document management program that integrates with your word processor.

16. Time and Billing • Track time, costs, and payments for billing, accounting, and self-defense purposes. • Prepare bills. • Generate management and productivity reports, e.g., compare effective rates (fees actually received divided by number of hours worked) of different types of cases so you know what is profitable and what is not.

17. Time and Billing Programs • Legal-specific: • PCLaw – www.pclaw.com. • STI Tabs3 – www.stilegal.com. • Time Matters/Billing Matters Plus –www.timematters.com. • Timeslips – www.timeslips.com. • Non-legal specific: • QuickBooks – www.intuit.com. • (QB is a good non-legal-specific accounting program; the time tracking and billing program is not legal specific and therefore not recommended.

18. Accounting Your accounting system should enable you to: • Write checks. • Enter deposits. • Allocate expenses to categories for management and income tax purposes, and between tax-deductible and non-tax-deductible (e.g., client costs advanced) expenses. • Allocate income to fees (taxable) and repayment of client costs advances (not taxable). • Maintain checking account balances. • Maintain separate trust accounting by bank account and client trust account. • Generate financial reports on demand to determine if you are earning the income you want and need. • Reduce your reliance on (and cost of) an accountant.

19. Non-Legal SpecificAccounting Programs • QuickBooks • MYOB • Peachtree • DAC • Others

20. Integrated Time, Billing,and Accounting • Try to integrate functions and programs as much as possible. • Avoid duplication of effort, e.g., entering cost advanced check into accounting system and again into billing system. • Learn one program instead of many programs. • Integrated time, billing, and accounting programs: • PCLaw Jr. - www.pclaw.com. • STI Tabs3 Jr. Suite – www.tabs3.com. • Time Matters/Billing Matters Plus –www.timematters.com

21. Law Practice Management Programs The “holy grail” of law office software • All law office functions in one program. • All functions integrate with each other. • One program to purchase and learn. • Contact manager/”Rolodex®”. • Case management: files, notes, pleadings. • Calendar, diary, and docket control. • Document assembly • Document management. • E-mail management. • Web site browsing management. • Legal research management.

22. Law Practice Management Programs Return on Investment Calculus How much time do you and your staff spend: • Looking for files? • Looking up phone numbers? • Checking case status? • Cutting and pasting documents? • Retyping the same information into different programs?

23. Law Practice Management Programs Return on Investment Calculus • If your law practice management software saves you 15 minutes per day, five days per week, 50 weeks per year, • Then you save 62.5 hours per year, which • At $150 per hour is $9,375 per attorney, and • At $20 per hour is $1,250 per staff member.

24. Computer Equipment • Universal Serial Bus (USB) port – standard equipment. • CD ROM (standard equipment) or DVD. • CD-R - re-writeable CD ROM drive recommended for high capacity portable storage, instead of: • USB drive. • Modem: v. 90 – standard equipment. • Uninterruptible power supply – optional, depending on chances of power loss or brown-outs in your area.

25. Law Practice Management Programs • Synchronize with time and billing programs, other computers, and Palm OS devices. • “Portablize” your entire practice; work from anywhere. • Program cost is $150-$350 per user. • Greatest cost component is learning curve and re-tooling office procedures – GIGO problem. • Cost of implementation recouped in short period of time because of increased efficiency. • Enables “value billing,” e.g., creating a will using a good practice management system takes a fraction of the time that “cutting and pasting” would take, yet the fee should be the same by charging a flat rather than an hourly rate. The client receives higher quality product because cutting and pasting mistakes are avoided and the turn-around time is much quicker.

26. Law Practice Management Programs • Abacus Law – www.abacuslaw.com. • Amicus Attorney – www.amicusattorney.com. • STI PracticeMaster - www.tabs3.com. • Time Matters – www.timematters.com

27. E-Mail • Register a domain name so your e-mail address is, e.g., bob@mcneill-law.com. • E-mail is replacing regular mail in many contexts. • Can reduce turn-around from minimum of one week to one minute. • Accessibility is what many clients want. • Some clients take e-mail for granted, and think their lawyers should have it, too. • Lawyers still need to treat important e-mail like important hard copy mail. See practice management systems, supra. • Microsoft Outlook/Express and Netscape Communicator are standards, but Eudora, Pegasus, and others work well.

28. E-Mail

29. Web Browsing • Reserve a domain name, e.g, mcneill-law.com, even if you don’t plan to set up a Web site in the near future. • Wealth of information available for “free” on the Internet. • Accuracy? • Evaluate search engines, pick one, and get good at it. • Computerized legal research without the hassle of CD ROMs. • Manage your Web research on a case-by-case so you don’t lose sites that are productive. See practice management systems, supra.

30. Substantive Legal Applications Examples • Domestic relations programs calculate child support guidelines, generate financial statements and child support guidelines, what-if alimony projections with after-tax effects, etc.: • Floridom. • FinPlan. • Bankruptcy forms: • Don’t have to calculate and recalculate. • Estate tax return programs. • Others.

31. Litigation Support • CaseMap www.casesoft.com

34. Utilities • Active Words www.activewords.com automates repetitive actions like going to a particular web site, opening a particular file, or entering text.

35. RemoteDictation

36. Continuing Law Practice Management Education • Join the MSBA Law Practice Management Section, and its listserv. • E-mail your questions to Pat Yevics. (Sorry, Pat.) • Join the ABA LPMS. • Or at least subscribe to Law Practice Management magazine. • ABA listserves on a variety of subjects. • ABA LPMS publications, especially Jay Foonberg’s How to Start and Manage a Law Practice, www.abanet.org/ lsd/pubs/5110293.html. • Talk to your colleagues; be proactive and start sole practitioner management “brown bag” lunches or breakfasts with your local bar association. • Before buying software you are trusting your legal life to, check out the tech support, get references, test it yourself, find out who to go to if the “stuff” hits the fan and you are up the creek without a calendar. • Know ahead of time where you will get equipment serviced.

38. Training, Training, Training • Hardware, software, and underware. • Training pays off. • Try to find trainers with law firm experience.

39. Computer Equipment Desktop computers • Almost a commodity now. • Hard to make a bad choice (but can be done). • Don’t buy the least expensive from a swap meet. • Local computer super store vs. mail order unless you are unfamiliar with computers and need a local vendor for one-on-one support. • “Sweet spot” of performance vs. price changes frequently. • Price stays about the same over time; performance increases. • Law office applications do not require high-performance computers, except for speech recognition; however, loading many programs at once uses lots of RAM.

40. Computer Equipment Notebook computers • Cost:benefit decision. • Cost: about two to three times that of a desktop computer, with parts and service proportionately as expensive; smaller screen, keyboard, and pointing device (although can be used with desktop monitor, keyboard, and mouse). • Benefits: work anywhere, anytime: home (ugh!), vacation (triple ugh!!!), client’s office or hospital room, deposition, courthouse. Possible to have every factum and document associated with the pending case on a notebook computer, giving you instant access to pleadings, discovery, business records, etc. See practice management systems, supra. • Wide variation in cost, features, size, and weight. • If only need extra computer for home use, consider two desktop computers instead of the additional cost of and having to lug around a notebook computer, and synchronize data on both.

41. Computer Equipment Personal Digital Assistants • Some functions of a desktop or notebook computer in a much smaller size for much less cost. • Choices: • Palm (the original manufacturer of hand-helds). • Pocket PC (mini-Windows operating system). • Palm OS synchronizes with more legal applications. • Talk to lawyers you see using them, and ask their opinions regarding usefulness.

42. Computer Equipment Personal Digital Assistants

43. Computer Equipment • CPU: Intel Pentium IV-class. • CPU speed: 1,000 MHz and greater. • RAM: 256 Mb. and higher. • Hard disk storage: 40 Gb. minimum. • Office suites consume 400 Mb. to 800 Mb. all by themselves. • Consider that scanned images take up more space than word processing documents take.

44. Computer Equipment • Universal Serial Bus (USB) port – standard equipment. • CD ROM (standard equipment) or DVD. • CD-R - re-writeable CD ROM drive recommended for high capacity portable storage, instead of: • USB drive. • Modem: v. 90 – standard equipment. • Uninterruptible power supply – optional, depending on chances of power loss or brown-outs in your area.

45. Networking • Makes everyone more efficient and increases collaboration. • Peer-to-peer network is built into Windows operating system. • Dedicated server network for more than five to 10 users, depending on level of concurrent access to common files. • Avoid wireless networks if possible: security and speed problems.

46. Backup, Backup, Backup

47. Computer Equipment Disaster Recovery Plan • Tape drive recommended: • DAT is best and more expensive; Travan is less reliable and less expensive. • Capacity sufficient to backup entire hard disk drive with one tape. • Software to schedule backups automatically and restore operating system as well as files. • Use rotation of at least 10 tapes to span several months in case error goes undetected for weeks or months or you discover an important file was deleted. • Last line of defense against loss of all data due to: • Equipment failure. • Theft. • Operator error. • Intentional deletion of data. • Inability to quickly restore your programs and data will cost you thousands of dollars, possible loss of clients, potential malpractice claims, and plenty of grey hairs. • All computer equipment will fail eventually, and Murphy’s Law dictates it will be at the worst possible time.

48. Computer Equipment Disaster Recovery Plan • Resist temptation to use other storage media with less capacity than entire hard drive, e.g., CD ROM. • Time required to restore from partial backups negates the initial cost savings of a less expensive system. • Disaster Recovery® feature of backup software restores operating system and backup software from CD ROM. • Keep all programs and manuals in a safe place.

49. Computer Equipment Virus Protection • Included with most computers, but don’t assume it works automatically. • Configure it properly, and keep it updated. • Ineffective against new viruses, needs the latest virus signature file (like the flu vaccine is changed every year) downloaded from the vendor’s Web site. • Norton Anti-Virus, McAfee Virus Scan, and Trend PC-cillin are popular. • Need to protect all access points: • Floppy and CD drives. • Internet e-mail. • Internet file downloads. • Especially important if you use Word or Outlook.

50. Computer Equipment • Monitor: 17-inch recommended, bigger if you need or can afford it; for smaller footprint, thin panel monitor prices have dropped. • Printer: Depends on needs: • Small office, low volume: all-in-one (printer, copier, scanner, and fax) will probably suffice, but get the laser not the color. • Hewlett-Packard is the industry standard: reputation for quality, reliability, and support; prices are competitive. • Key features: single bin, multiple bin, manual feed for envelopes, dedicated envelope feeder, speed, resolution, laser (black only, but recommended) vs. inkjet (color, but not used widely in law office documents).