It employs software to manage internal legal documents and workflows, electronic billing and invoicing, and to guide decision-making through reporting and analytics.
[2] Separate but related technologies include information governance, electronic discovery, legal hold, contract management, corporate secretary, and board of directors’ communications.
[5] Several factors led to a shift away from traditional, low-technology solutions and toward ELM, most notably the expansion of the Internet during the 1990s and subsequent development of Software as a service (SaaS) platforms.
[10] External legal costs presented unique management challenges because of the billable-hour model and unpredictable labor requirements.
This integration provided the opportunity to meet management demands for increased communication and information from within corporate legal departments.
[16] ELM software primarily supports matter management and electronic billing, with derived analytics and reporting guiding legal department business processes.
[22] Development of LEDES in the late 1990s was supplemented by the American Bar Association’s creation of Uniform Task-Based Management System (UTBMS) to establish consistent coding of services by outside counsel.
[26] Legal departments use analytics to inform these budgeting and forecasting decisions, with the selection of outside law firms based on tradeoffs between cost and attorney performance.
[27] Internal historical billing data and industry benchmarks identify trends and differences among providers, and average fees associated with matter types.
[28] Recent developments within ELM software include the utilization of machine learning and artificial intelligence in order to predict claims costs.
These types of predictions are intended to reduce insurer's combined ratio by driving early settlements for claims likely to carry a greater than average cost.