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10 Signs That Your Law Firm Needs a DMS

April 17, 2024

Most roads lead to documents in the fast-paced world of law, so efficient document management isn't just about organization — it's a cornerstone of success. For small to midsize legal firms, the stakes are even higher, where not being able to get to the right content at the moment of need can lead to operational inefficiencies with significant impacts on service quality and profitability. But how do you know when it's time to level up your document strategies and transition to a document management system (DMS)? Here are 10 signs to look for that signal your practice might be ready for change.

1. The Quest for Documents: Excessive Time Spent on Searches

If your attorneys and staff are spending more time rummaging through files than advising clients, it's a red flag. According to Clio's 2023 Legal Trends Report, the average lawyer only amassed 2.72 hours of billable work per day. In other words, they're spending most of their workday on repetitive administrative tasks. Research has also shown that difficulty finding data or documents is one of the biggest barriers to employee productivity — not to mention frustration.

A DMS can turn a time-consuming hunt into a swift search-and-retrieve mission, freeing up your team to focus on what they do best — practicing law. Having a customizable home page and lists of Recent and Favorite Documents put everything you’re working on at your fingertips. Plus, having all of your documents OCR’d means even image-based PDF files will be fully searchable.

“Nothing is as fabulous as NetDocuments for finding something when I do not have a clue where I need to look for it.” – Willem Leppink, Ploum

See how Ploum gets more value from their files with NetDocuments.  

2. The Case of the Missing Files: Frequent Document Loss or Misplacement

When documents go missing, it’s not just an annoyance — it can mean the difference between meeting and missing critical deadlines. It can also be an expensive waste of valuable time. Research from PricewaterhouseCoopers indicates that labor costs range from $120-250 per file to search for misfiled or lost files.

A DMS acts like a digital safe-deposit box, ensuring all your documents are accounted for and easy to find when you need them, which can be especially crucial when you’re dealing with the unforgiving constraints of legal timeframes. Having everything organized into matter or project workspaces means everyone is always up to date on work being done.

3. Remote Work Roadblocks: Difficulty in Accessing Files

The modern legal practice isn’t confined to an office. Lawyers work from courtrooms, client sites, and increasingly from home — in fact, more than 70%of lawyers work outside the office at least some of the time. Having to go through terminal servers and remote desktops wastes time, costs money, and means your firm's agility suffers. Implementing a cloud-based DMS means your team can securely access files, anytime and anywhere on any device, with just a few clicks.

It’s worth noting that the ability to work remotely is a top priority among young lawyers, with 44% reporting they would leave their current job if given the opportunity to work remotely elsewhere. With that in mind, a cloud-based DMS is more than a productivity tool — it’s a recruiting incentive.

4. Teamwork Trials: Challenges in Collaboration

Effective collaboration on documents is a non-negotiable in law firms. Throughout the matter lifecycle, files need to be shared between your practice, clients, expert witnesses, and others.  Data from Harvard Law School shows the benefits of collaboration in law firm can include:

  • Higher margins
  • More loyal clients
  • Ability to charge more
  • Greater business growth

Having built-in tools for file uploads, downloads, and secure file sharing smooths out workflows, improves client service, and makes a DMS an essential tool.

5. Version Vexation: Inconsistent Document Control

When multiple team members work on different versions of a document without a unifying system, chaos ensues. Tracking the most current version of a document can be frustrating — and costly. Document versioning helps uphold the integrity of documents through effective version control. Solutions that provide these capabilities help legal teams automate document lifecycle processes, govern content, streamline collaboration, and provide a comprehensive audit trail.

A DMS maintains order by providing version control, ensuring that everyone is working from the most up-to-date document and that past versions are archived for reference This creates a single source of truth and keeps all your team members on the same page — literally.

“Now that our documents are in the cloud, we have confidence knowing that we’ll always find the most current version or correspondence.” – Gary Smith, Richard and Richard, P.A.

See how Richard and Richard, P.A. made it easier than ever to organize, find, and access their files by switching to NetDocuments.

6. Confidentiality Concerns: Security Risks with Sensitive Information

Client confidentiality and data protection is paramount in legal practice. The types and volume of data law firms handle makes them a prime target for cyber criminals. A breach can result in days of downtime, loss of trust, public embarrassment, significant remediation costs, and even legal repercussions. While the average cost of a data breach has reached an all-time high of $4.45 million, law firms may face even steeper costs thanks to the higher standards and expectations of the legal industry.

To protect against these risks, law firms need the added layers of protection in a robust DMS that offers advanced security protocols, encryption, and access controls to protect sensitive information from unauthorized eyes.

7.The Client Compass: Dissatisfaction Due to Slow Processes

Investing in intuitive, productivity-boosting tools can help improve your firm’s reputation. In a world where clients expect immediate responses and the ease of consumer mobile apps, a slow document-related process can lead to dissatisfaction and lost business. Lawyers who skillfully utilize technology like a DMS are far more likely to meet or exceed client expectations for case timelines.

With integrations to your other tools, digital document set builders, and things like DocuSign, a DMS can accelerate turnaround times for document-related inquiries and transactions, leading to a noticeably enhanced experience that clients will be happy to repeat and recommend. But it’s not just that: tech-savvy lawyers are also perceived as having stronger legal expertise.

Believe it or not, the way law firms employ tech tools, such as document management systems, can have a significant impact on the speed at which cases get resolved.

8. Digital Detritus: Complexities and Costs of Scaling Storage

As your law firm grows, so does your digital document load. While many firms have significantly cut back their paper use, the point remains: lawyers still generate an enormous volume of documents year after year after year. Firms that choose to store documents digitally on-premises must tackle the large upfront costs and continual maintenance of hardware, software, physical security, and more.

On the other hand, a cloud-based DMS is scalable on-demand, allowing your firm to grow without being hamstrung by physical storage constraints. Meanwhile, the vendor is responsible for licensing, maintaining, upgrading and securing the servers and other hardware behind the scenes reducing your tech-related expenses while providing greater technical and cybersecurity expertise than local IT support can. The added bonus is that  when it’s time to scale up your storage, all the hard work is done for you.

“Moving [our law firm] to the cloud was important as it would help us reduce storage costs and become more efficient in the long run.” – Toh Kok Seng, Lee & Lee

See how one of Singapore’s oldest law firms finally made the switch from paper-based to winning the digital race with NetDocuments.

9. The Compliance Conundrum: Regulatory Overload

With the ever-increasing complexity of compliance regulations, staying on top of all the requirements can be overwhelming. Fortunately, a DMS can streamline this process with features like automatic retention schedules and easy access to audit trails, helping your firm stay compliant with less effort.

“NetDocuments allows us to regularly review what’s still outstanding and make sure compliance and governance concerns are dealt with as soon as they come. I can log in and see where we are in the various matters and take any necessary action.” – Nina Stewart, Astraea Group

See how Astraea Group elevated their compliance and governance approach with NetDocuments.  

10. The High Price of Paper: Overhead Costs of Physical Storage Systems

The cost of maintaining physical documents extends beyond just storage space and lack of remote accessibility. It includes paper, ink, toner, printers and printer maintenance, file folders, labels, storage containers, and more. Per one estimate, the average four-drawer cabinet costs about $25,000 to fill and $2,000 annually to maintain.

But perhaps the biggest cost of using physical documents is time — the cumulative hours spent every time someone has to dig through a musty file room to find a single document among millions of printed pages versus performing a simple online search or going to a matter workspace in the DMS.

It simply cannot compare to the efficiency of quickly clicking through digital files. A DMS not only cuts down on all these costs, but also supports a more environmentally friendly, paperless office.

Recognizing the Signs

If you've nodded along to any of the signs above, it may be time for your law firm to consider a DMS. By recognizing these inefficiencies and daily frustrations, you can take a proactive step toward modernizing your practice, improving productivity, and securing your clients' data.

Time to Talk Solutions

Recognize any of these signs in your firm? Don't let outdated processes hold you back any longer! It's time to talk about solutions. Reach out to us to explore how NetDocuments’ cloud-based DMS can evolve your practice, streamline your operations, and set your firm up for future success.


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