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Protecting data in the legal industry

October 16th, 2006

Many benefits accrue from business continuity planning, including high availability of systems, good disaster recovery procedures and better backup systems — all of which mitigate unplanned outages. Additionally, Sarbanes-Oxley and other compliance regulations have impacted data and record retention for many business sectors served by lawyers, including financial, government and healthcare.

Two notable factors make business continuity planning in the legal segment especially important:

1. The average legal practice has the highest percentage of revenue generating workers per company of any major industry in the world. This results in an even greater need for high productivity and guaranteed uptime due to the hourly billable nature of the legal workplace.

2. Because of the level of disclosure that clients must give to their own lawyers as part of most major litigations, clients are often forced to trust significant amounts of their own data to their lawyers. By extension, this means that continuity regulations around the viability and security of data, arguably transfers to the practice representing those organisations.

A law company’s IT department should focus on the three core aspects of business continuity planning: High availability — protecting productivity; Disaster recovery — protecting the practice and Better backups — protecting the data.

High availability — protecting productivity

In business continuity planning, one of the primary goals most often pursued is that of ensuring uninterrupted productivity and to minimise the cost of downtime.

Consider a small practice, a 25-person office (10 lawyers and 15 support personnel). If the production server goes down in the middle of the day, data loss for both the first part of the day and productivity loss for the entire day will be incurred. We can measure productivity loss as the entire amount of manpower, which either is incapacitated or will need to be reapplied while repeating a task. In this case, we have data loss, plus a productivity loss for the time it takes to replicate lost work, plus the hours where users cannot access their data and may be completely idle.

Using industry statistics, this 25-person office has a manpower cost of Ј1,000 per hour (considering average salaries and benefits for partners, lawyers, paralegals and administrative staff positions). Assuming half a day of data loss and a full day of productivity loss, a single one-day outage will cost this small organisation Ј16,000 (exclusive of any lost revenue). If we include the average billing rate (assume 60 percent of revenue generators’ hours are billable and multiply that by industry-average rates), the company will lose an additional Ј18,000 of revenue. While this small office may have considered itself “too small” for business continuity planning, a single outage per year carries a not-so-small price tag of Ј34,000.

Downtime happens, inevitably. Business continuity planning is about reducing its costs. If Ј5,000 can be spent to mitigate a Ј34,000 loss and any future Ј34,000 losses for the entire time that the business continuity technology is in place, there is a huge return on investment even for the smallest company.

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