Operationalizing e-discovery—two different approaches

How to determine whether a piecemeal or holistic model is right for your company

As the legal community continues to confront e-discovery, corporate legal departments are beginning to develop different methodologies to strategically manage the process. This operationalizing of e-discovery offers corporations and in-house counsel a number of benefits, including cost and time efficiencies. By creating some structure around the e-discovery process and proactively negotiating with vendors, in-house counsel can move away from unpredictable per-unit pricing models in exchange for more transparent fee structures.

Why operationalize?

There are a number of factors driving the operationalizing of e-discovery.

1.  The sheer complexity of e-discovery has created the need to streamline the process. In-house counsel are now seeking to develop a set of policies and procedures that can help them place controls around e-discovery, leading to predictable levels of quality, efficiency and costs. This is especially true in light of the fact that each matter may involve a variety of internal and external stakeholders, from IT and records management to outside counsel and legal technology vendors. By operationalizing the process, legal departments can better coordinate these disparate parties.

2. The complexity of the e-discovery process exposes an organization to a considerable amount of risk. Because e-discovery will remain a routine duty of the legal department for the indefinite future, the chief information officer and IT department are increasingly involved in acquiring the tools and services to create repeatable and defensible processes.

3.  As our culture has shifted from paper to digital communications, there has been an explosion in the amount of electronically stored information. It's not uncommon for corporations to put data in terms of petabytes, which is equal to 1 million gigabytes. This deluge of data means that without a plan in place, e-discovery can quickly become an unmanageable and expensive process.

4. The economic downturn of the last few years has put corporate expenditures under scrutiny. This includes a company's litigation budget, which can easily swell as the volume of corporate data and the frequency of e-discovery requests increase. This need to rein in costs, or at least create a means to predict litigation costs, has also led to the operationalization of e-discovery.

There is not a one-size-fits-all approach to operationalizing e-discovery. The method that a legal department chooses to employ will depend on a variety of factors, including its amount of resources, its level of technology acumen and its litigation profile. But generally, there are two overarching approaches that a legal department can take to operationalize its e-discovery process.

The piecemeal approach

The first method is the piecemeal approach. This requires in-house counsel, and increasingly the IT department, to separately scrutinize each component of the e-discovery process, from collection to processing to review. They select the best legal technology vendor in each step and negotiate the best price. The end result is an e-discovery process where each component functions at maximum efficiency for its particular phase and each vendor involved charges a competitive rate.

The benefit of this piecemeal approach is that the company can leverage each vendor's strengths to receive the best possible service for each step in the e-discovery process. Additionally, by conducting separate requests for proposal for each step in the Electronic Discovery Reference Model and negotiating the best price per vendor, companies can realize incredible cost savings.

However, in order to reap the benefits of the piecemeal approach, companies must have a knowledgeable e-discovery professional internally to orchestrate the process between the disparate vendors. This project management is essential to ensuring that errors are not made during the multiple hand-offs between vendors and tools. This individual must have a comprehensive understanding of the various technologies in use in order to maximize efficiencies within the workflow.

These separate vendor relationships can take time to cultivate, requiring an initial significant investment in time. Finally, the total cost of the piecemeal approach can be somewhat difficult to predict. Although the goal is to negotiate the best rate per vendor, adequately projecting the final price tag of a project can be difficult, especially if no one is overseeing, or held accountable for, the entire process to ensure data is culled down as it is passed to the review stage. Also, a vendor's original quote may not include additional service fees, including project management.

The holistic approach

The second method to operationalizing e-discovery is the holistic approach. Rather than contract separate vendors to manage the various steps, the company contracts one vendor to handle the entire e-discovery process, from collection to production.

This holistic approach is ideal for companies with more complex matters or a high volume of e-discovery. It is also helpful for those that don’t want to invest in a large in-house team or that are otherwise facing budget pressure. With the holistic approach, the outside vendor can identify efficiencies within the workflow and manage the process from beginning to end.

Additionally, the holistic approach can provide a more predictable cost structure. Separate vendors may use different fee arrangements, whereas selecting only one vendor often enables the legal department to negotiate a more competitive rate. This rate may include additional services, such as project management.

Finally, one of the greatest advantages of the holistic approach is the ability for in-house counsel and the outside vendor to align their incentives to reduce the entire data set prior to passing it off for review. By having both parties work to cull down data early in the process, the legal department can reap significant cost and time savings.

The holistic approach is not without its caveats. You will want to conduct your due diligence to ensure that the selected vendor has the flexibility to adjust the workflow and pricing of any e-discovery project, regardless of the size. This flexibility is critical, especially if the scope of a matter changes within the course of litigation.

It should be noted that an increasing number of corporations are opting for a hybrid approach between the two models. This method is ideal for legal departments that have in place an e-discovery team that has the expertise to manage most cases internally using a piecemeal approach but may rely on an outside vendor for support on larger matters.

Steps to operationalizing

Operationalizing e-discovery may seem like a daunting process. But there are some clearly defined steps you can take to begin understanding which approach may best work for your legal department:

  • Understand what resources you currently have at your disposal. Take an inventory of the technology, the vendor relationships and the personnel that you can rely on to operationalize the process.
  • Understand what type of matters you deal with. Take note of size, complexity and frequency.
  • Determine which approach best suits your legal department. If you have the internal resources available and your matters lean toward the small side, you may benefit from a piecemeal approach. If instead you frequently encounter larger matters that require outside expertise, consider a holistic approach. A helpful exercise is to take a matter from the prior year, run it through hypothetical piecemeal and holistic approaches and compare the projected final costs.          
  • Develop some in-house e-discovery expertise. E-discovery is a complex area, and changes in technology, including social media and cloud computing, are only going to make the field more difficult to understand. It is crucial that you take steps to foster an in-house understanding of the various technologies and workflows that can enhance the e-discovery process.
  • Align incentives with your vendors. Make sure when contracting outside providers that they understand the goal is to cull early in the e-discovery process so that the body of data shrinks as it enters the review stage.

Contributing Author

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Sophie Ross

Sophie Ross is a senior managing director within FTI Consulting and oversees Acuity, the company’s managed document review service. She can be reached at

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