legal document management
As the name suggests, legal document management involves the storage and handling of documents that relate to legal matters. Lawyers deal in vast numbers of documents and files every day, from contracts, licences, and letters to emails, notices, and reports. For this reason, they need access to systems that not only help store documents, but also track, manage and search them. In fact, document management should not be confused with document storage, which is merely the saving and ordering of documents within folders either stored locally or in a file server. Document management is so much more.
Whilst there are numerous digital document management tools out there, document management practices for legal often differ greatly compared to standards in other industries. As a result, dedicated legal document management software began to emerge in the 1990s to support law firms and in-house legal teams. Since then, the legal document management market has matured greatly, and the solutions have moved into the cloud and become collaborative.
Essential features of a legal document management system (DMS)
There are now many legal document management tools that can help legal teams to manage all their documents and correspondence. So much so, it’s sometimes difficult to know where to start and what functionality to look for.
Before we get on to some of the more interesting features, let’s start with the basic functionality that is essential for a good legal document management system.
Store, organise and search
A legal DMS should enable legal teams to store, organise and search their legal documents. This involves being able to move and copy documents where needed. Users should be able to record metadata about each document (e.g., matter number, team, location etc.) and that metadata should be searchable along with the file name and document contents.
A legal DMS should also have version control functionality – allowing different versions of the same document to be saved (and in some cases restored), with the ability to check-out documents to prevent version conflict. Auditing is also critical – there should be a record of every interaction between a user and a document version so that it’s clear who did what and when.
Documents should be able to be opened in their native applications directly from the legal DMS. It’s also important that documents (both a copy and a link to the underlying document) can be shared via the legal DMS.
With so many documents exchanged over email, an integration with MS Outlook and other email clients is essential so that documents can be sent via email, and emails and their attachments can be saved back down to the system. For this reason, it’s also important that legal document management systems support the storage of both emails and their metadata.
Finally, with so many documents and versions being handled – a numbering convention is necessary. Therefore, look for systems that automatically number documents, including matter and version numbers.
Important legal DMS functionality
As well as the core features, there is other key functionality you should be looking for in a legal document management system.
Security and compliance
A legal professional must ensure they are adhering to industry compliance and security standards. When choosing a legal DMS, make sure it has top-grade and industry recognised security certifications, e.g., ISO, HIPAA and SOC, and it has excellent infrastructure security, including firewalls, application level-filtering, antivirus scanning and intrusion detection. Also ensure that data is encrypted both in transit and at rest. Application security is also vital – for example, password expiry and IP restrictions for cloud-based solutions. Any legal DMS vendor should be backing up data to multiple secure locations to ensure integrity of data, and there should be robust disaster recovery procedures in place. Look for products that are thoroughly and regularly audited by third-party security experts who provide penetration testing etc. If you opt for a cloud solution, make sure you know where your data will be stored and that the data centres have state of the art physical security.
Records management involves managing the creation, use, management and disposal of records, including certain documents. It’s a critical component of most organisations’ risk and compliance activities. Therefore, any legal document management system should be able to allocate unique identifiers to documents, prevent unauthorised changes to documents, lock documents to prevent modification, and create audit trails of the document lifecycle. The system should also support retention scheduling and rules for how long different documents should be kept. These rules should be assigned based on the type of document. Finally, the legal DMS should allow for the disposition of documents that no longer need to be retained.
Look for systems that provide for role-based permissioning to reduce the risk of unauthorised access to sensitive information. With this functionality, documents and folders can be restricted for access by certain users or groups only. However, sometimes this level of permissioning isn’t enough for when specific matters and associated data need to be completely hidden from all but a small group of people. Just because you can’t see a particular document, doesn’t mean metadata (e.g., matter name) will also be hidden in other areas of the system such as look-ups, and this could be a problem for highly sensitive matters. You should therefore look for legal DMS that actually lock-down the whole matter by hiding the both the matter and its data and documents from appearing anywhere in the system for non-authorised users.
Documents, and contracts in particular, are part of a broader lifecycle that encompasses drafting, review, negotiation, execution and management. Whilst legal document management systems help with storage and versioning, a lot of legal teams rely on other tools to support the different elements of the document lifecycle. For this reason, when looking at legal DMS you should make sure it has the integrations you need right now, as well as the integrations you may need in future. As a minimum, make sure that the system integrates well with Microsoft Office and Outlook. Given we are now a remote workforce following the pandemic, also look for tools that integrate with collaboration and instant messaging tools like MS Teams and Slack. From there, you can also look at integrations with document assembly tools for drafting documents, and eSignature tools for document execution. You may also want to favour legal DMS platforms that integrate with artificial intelligence (AI) tools so that you can intelligently sort, categorise and review your documents and extract important data. AI integrations could significantly help with improving the quality of search within your legal DMS.
Legal documents go hand-in-hand with legal matters and projects. There needs to be very close alignment between a legal DMS and a matter management system. This enables matter data to be associated to documents and invoices in the legal DMS, and the matter management system to pull in relevant documents for a particular matter. For legal teams to operate efficiently they need to consolidate and align their data across multiple systems. This also offers the best user experience so that users are not always ‘context switching’ into different software tools. All your systems need to communicate so counsel can navigate easily across matters and their documents. Legal teams should be looking to start building their “legal operations space” – consisting of a legal document management system alongside matter management, eBilling and contract management software.
When purchasing a legal DMS you will likely have two main deployment options – on-premise, which means the application and documents will be hosted and stored in your organisation’s own IT infrastructure, and cloud, where they are hosted and stored on secure remote servers within one or more data centres. There is a third option – hybrid storage – where the application is cloud hosted, but documents and data are stored on-premise.
Cloud has its benefits in terms of speed of deployment, scalability and reduced cost of operation and maintenance, however, on-premise and hybrid solutions are good for organisations who want more control over their data and have higher security requirements. Organisations such as financial institutions need very high levels of security. Whilst some cloud providers can meet these standards, some organisations will always insist on on-premise deployments. Make sure you know what your organisation expects by way of deployment and document hosting, and make sure that the legal DMS will support this.
Collaboration and productivity
A good legal document management system will help you and your team get work done. Document collaboration is increasingly moving online with document co-authoring tools – including those included with MS Office online. This offers a better drafting experience where colleagues can work in real time to amend and refine documents. Legal DMS systems should be offering collaboration tools and integrations to help users not only store and locate documents but also work on them. Look for legal DMS platforms that offer a range of collaboration functionality – from co-authoring and annotations to commenting and approvals. With a growing remote workforce, also see if the legal DMS has tools that support asynchronous working across remotely dispersed teams. Also consider exploring tools that use AI to deliver intelligent search capability, so users have better access to legal knowledge in context.
Transform chaos into order with a Legal DMS
A legal DMS can transform the way your legal team works, collaborates and accesses knowledge. It will bring order to the chaos of legal documents and will create a secure and searchable repository that gives your team quick and simple access to the documents they need, when they need them. With the right integrations and functionality, it will help manage entire document lifecycles and will make your legal team more productive with collaboration tools.
Stop hunting down documents across email, local folders and shared drives and make the leap to a modern legal DMS. Hopefully our tips for what to consider will set you and your team on course for an efficient and productive future, where working with documents is a pleasure, and not a chore.