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Conduent Legal and Compliance SolutionsRight-sizing electronic discovery:the case for managed servicesA white paper

Conduent Legal and Compliance SolutionsToday, eDiscovery models are shifting as corporations re-evaluate the level of responsibilityand internal investment they are willing tomake, along with the level of control they wantIn an effort to “right-size” eDiscovery, corporations andlaw firms are debating the optimal way to manageelectronic discovery deployment within their organizations.Traditionally, corporations trusted their numerous outsidelaw firms to manage their eDiscovery functions, who inturn outsourced some processes to eDiscovery serviceproviders. The decentralization resulting from this modelhad the unintended consequences of building silos aroundcertain processes, maintaining repetitive (and sometimesoverlapping) functions, technology and resources, andmaking standardization (and budgeting) across matters andentire litigation portfolios difficult.to exercise over eDiscovery processes.Today, eDiscovery models are shifting as corporations re-evaluate the level of responsibility and internal investment they are willing to make, along with the level of controlthey want to exercise over eDiscovery processes. There are a variety of feasible optionsorganizations are now adopting, with models ranging from bringing eDiscovery entirelyin-house to, at the other end of the spectrum, fully outsourcing eDiscovery tasks to aneDiscovery service provider (while still driving strategy). Most organizations however,find the best approach lies somewhere in between — bringing certain activities in-houseand outsourcing others based on careful consideration of their needs, strengths andlong-term goals.As organizations increasingly keep processes in-house that are part of their own competencies, and collaborate with service providers on parts of the process that make sensefrom a budget, operational and risk perspective, the managed services model is increasingly a viable way to manage discovery.An overview of the optionsInsourcing: bringing eDiscovery processes in-houseOne approach is to bring the infrastructure, processes and people in-house for the broadspectrum of eDiscovery tasks, from preservation and legal hold to collections, dataprocessing, early case assessment, document review and production. The technologyitself may be a single, integrated tool or multiple applications licensed from a variety ofvendors, but the key is deploying technology that can be leveraged along with processes,staff and expertise to manage all processes internally. Such an approach provides costpredictability of the technology, and allows the organization to effectively control theprocess. Some organizations also find that work may get done faster (specifically startedfaster), since there is no third-party layer to work through.Moreover, organizations can leverage in-house knowledge and expertise on their dataand systems. For example, since upstream activities, such as preservation, legal hold and

Conduent Legal and Compliance Solutionscollections, are part of larger IT-driven business processes, these processes are oftenmore suited for internal management, with oversight from outside counsel and reliance—as needed—on certified eDiscovery consultants. Furthermore, bringing eDiscovery in-house allows organizations to maintain control over the technology and own alloperational processes and data handling activities behind their firewalls. This is ideal forcertain types of litigation, such as cross-border matters or internal investigations, wheredata often must remain on site.However, there can be a significant cost and risk attached to bringing all electronicdiscovery in-house. Organizations must continually consider a number of different andever-evolving tools required to manage each part of the process. In many cases, organizations are looking to platforms that integrate all functionality in a single product (i.e.,collections, processing, advanced analytics, review and production) to eliminate the needto invest in, integrate and manage multiple applications to manage disparate parts ofthe process. However, even fully integrated platforms require dedicated IT and legal staffto operate them, and also must address the challenges of scalability and impact on theorganization’s IT infrastructure.Custom managed services: partial outsourcing in a dedicated environmentOrganizations seeking to avoid the capital and operational expenditures and burdensassociated with maintaining and scaling infrastructure in-house—but that still want tomaintain control over the eDiscovery application and data management processes—canopt for third-party hosting of the infrastructure in a dedicated environment. Oftencalled managed hosting, this managed services model gives organizations the flexibilityto leverage their own staff to manage the application, the process and their datathemselves, with the hardware and software residing within the service provider’sprivate cloud.Beyond outsourcing the infrastructure, the organization can access—on a customizedbasis—the services it needs to fill gaps in existing technology, processes or resources. Forexample, processing and managing a large, multi-terabyte matter can present challengesto any organization. If an organization knows it does not have the capabilities to processlarge matters, it can outsource the processing and hosting for matters of or over that sizeto the service provider that can perform the work outside of the dedicated environment.Many organizations are uncomfortable about having their data managed and storedby an outside vendor due to security, privacy and business continuity concerns. Thismodel has the benefit of allowing lawyers and their IT staff to maintain stringent securityobligations by partnering with a service provider that has extensive data center securitycertifications and protocols.Comprehensive managed services: complete outsourcingIn a comprehensive managed services model, organizations outsource a substantial partof the eDiscovery process. The data management infrastructure, like the custom managed services model, is typically managed through a service provider’s private cloud ina secure environment. The services include comprehensive supporting eDiscovery datamanagement activities, such as data filtering, processing, analytics, review management,production and project management services—and even proactive compliance measuresand data analysis. The work is performed by the service provider utilizing their resources,but it is done in an environment directed by the organization.

Conduent Legal and Compliance SolutionsOne of the greatest benefits of a comprehensive managed services model is greater costpredictability and the control it affords to the organization. Services are often renderedusing innovative pricing arrangements as part of a multi-year, single provider relationship.Retainer-based arrangements, buoyed by service level agreements (SLAs) for performance, help smooth the unpredictable spikes in spend created by the transactionalnature of legal work and can ensure quality work.A managed service provider fills gaps intechnical and process resources quickly, whilereplicating and standardizing processes acrossan organization’s litigation portfolio, whichimproves efficiencies and defensibility.Moreover, service providers have an expertise and resources that are often beyond thescope of a typical organization. These relationships create a partnership and the servicepartner gains essential knowledge of corporate business activities and infrastructure.In turn, the service provider can better apply this expertise to fill the gaps in an organization’s resources and expertise, especially on topics such as data acquisition andcollections strategy (under the direction of outside counsel), strategic search, technologyassisted review (TAR) consulting, analytical services to maximize information from thedata set and managed review.An added benefit of comprehensive managed services is the facilitation of more standardized data management activities and processes across all matters, creating moreefficient, transparent and defensible processes.This approach can also be flexible and customized to fit an organization’s needs. Someorganizations—especially ones with large recurring litigation portfolios—may decideto bring hosting in-house to realize economies of scale while utilizing their partner fordata processing and other services. Others may only bring technology (and resources)in-house for processing and hosting of small, day-to-day matters (such as internal investigations or proactive upstream activities such as early case assessment and compliance),and then completely outsource all processing and hosting for burst capacity needs andmatters that exceed a certain volume.Managed review is another area that can be filled by a service provider, which can helpdrive standardization and cost control across an organization’s litigation portfolio, as wellas ensure the transfer of knowledge from project to project regardless of which outsidecounsel may be engaged in any particular project.Benefits of a managed services approachLeveraging managed services—whether choosing to outsource the infrastructure andcustomize supporting services based on the needs of the organization, or taking a comprehensive managed services approach—provides a number of distinct benefits.In addition to allowing the organization to drive the strategy but outsource some (or all)operational tasks, benefits include the following:Greater budget predictability and cost management. Managed service providers candrive innovative fee arrangements that provide transparency within the organization,budget predictability and better cost management across matters. Organizations canalso negotiate favourable and innovative agreement terms as part of long-term singlevendor contracts.