The Role of Technology in a Merger - Merger Glue
by Dan C. Felean  |   Download this document in Adobe Acrobat format

Never say never. Sooner or later every law firm of size or substance will consider the possibility of merging with another. Some experts predict that mergers and acquisitions will become an ongoing, almost routine, part of business and a competitive stratagy. As more clients demand greater depth of service and broader competencies over wider geography and jurisdictions, the consolidation in the legal market will continue. Incremental growth is often too slow, too expensive or too painful.

Information technology, especially web technologies, can play an important role in the success of a merger. It can make your firm "merger ready" to quickly blend talents and resources with your new partner, so that you hit the ground running. It can act as "merger glue" to bond the new organization together and leverage resources for the benefit of clients, lawyers and staff. As a result, you can create a new identity and culture that is neither "mine" nor "yours," but "ours."

More Than a Name Change
Technology is rarely a primary consideration in pre-merger discussions. Fundamental issues, such as firm governance, compensation, alignment of capital, and lawyer-client-practice compatibilities have to come first.

However, once the merger terms are agreed upon, the new management must quickly determine how information technology can help transform the organization and advance post-merger objectives. In order to make the merged firm more than just a new name, new letterhead, and new web site, management must give priority to technologies that can produce immediate results by advancing communication, collaboration and community across the organization.

A law firm merger typically creates an organization with two or more physical locations, practicing in multiple jurisdictions, having differing areas of expertise, and sometimes speaking two or more languages. Each firm has distinct clients, policies, resources and cultures. Each has separate databases, production systems and information sources. So, finding immediate compatibility is highly unlikely. Yet, the success of any merger will be dependent upon how quickly the firm can overcome these differences to focus on growth and opportunity.

Prioritize Technology That Connects
What type of technologies can bond the new organization and advance the firm-wide objectives? Those that can be deployed and adopted quickly across multiple locations take priority. Those that offer dynamic content targeted to the needs and roles of particular members will demonstrate direct payback to both users and clients.

E-mail is an obvious first choice, since everyone has it and knows how to use it. Yet, necessary base technologies like e-mail and telephones offer no differentiating advantage to a merged firm, and they offer no distinctive leverage.

While nothing replaces face-to-face interaction, video conferencing and on-line web collaboration tools are key elements of gluing the new organization together. Constant travel is costly and time-consuming, and in the aftermath of recent tragic events, many will be reluctant to travel often.

Advances in IP and video compression are making web video conferencing a reliable and affordable alternative. These virtual face-toface technologies promote cross-office collaboration and allow members to get acquainted with collective skills in a team approach. An assortment of Internet-based real time collaboration tools from web meetings to deal rooms, offer other ways to collaborate on specific projects or cases, regardless of location.

A Web Portal Is the Daily Glue
In the critical period following a merger, the law firm needs to establish one common communication platform that engages people at all levels in the new organization. A "Web Portal" is particularly suited to act as merger glue in this diverse environment. (Note: While some would call this an intranet, the distinction between intranet and extranet portal blurs when law firms merge, since "inside" and "outside" depends on how they connect and share.)

In a firm-wide portal, a wealth of cross-office information and resources become accessible through one simple, intuitive browser interface. As such, it can be deployed quickly with little adaptation or training. Most importantly, it can deliver information to lawyers and staff immediately, bypassing the inevitable battle over replacing existing internal systems.

> While many firms have some form of intranet, few have developed a portal that specifically addresses multi-office merger objectives. Here are some of the special circumstances that should be considered in a Merger Glue Portal.

Minimize Disruption
A merger is first and foremost about people, and people are stressed by change. A firmwide portal creates a new inclusive information platform that overlays current processes. It leaves existing production methods in place while channeling information from these systems to the forefront of the portal for easy consumption.

Establish Identity and Culture
After the receptions and retreats are over, most law firm members have little extra time for daily interaction with their new counterparts. A firm-wide portal can become the one reliable common denominator between all members in all offices. It can focus on the bigger picture while speaking directly to the individual. It can help establish a new identity and culture, and foster a sense of community among offices.

Simultaneous Targeted Communication
Frequent direct communication can relieve some of the tension of a merger and preclude excessive speculation. People adapt better to change when they feel they are honestly informed. The portal allows users at every location to access the same information at the same time in the same way.

Moreover, the firm can choose its message carefully and deliver it directly to all members or to specific groups within the firm. Information delivery can be personalized based on the office, role, and security level of the individual. Ethical walls can be maintained and respected. In a multinational or multilingual merger, the firm can improve clarity and connect better with individuals by delivering important information in their language of choice.

Who knows who? Who knows how? Who knows what?
A portal can provide a single point of access to information that spans all offices. Essential firm knowledge, such as personnel directories, committees, practice groups and individual expertise, can be consolidated for access by all members in all offices. Similarly, discussion and work areas for cross-office practice groups and business development can help lawyers better leverage the resources and skills available within the new organization.

Equivalent Information from two sources
To create a cohesive new organization, all lawyers need access to similar information about their work, their team and their clients, regardless of the underlying office systems. The absence of good firm-wide comparative information during the fragile beginning of a merged firm can be detrimental to both lawyers and clients.

A portal can tap diverse sources of information (such as two otherwise incompatible billing systems) to present equivalent information items (WIP, A/R, etc.) to lawyers at each office. This gives all lawyers quick, accurate decision support information, even before the underlying production systems are converted. Access can be personalized to deliver information relevant to the individual, whether secretary, lawyer or department manager.

Technology Helping People
It takes time for people to learn to trust one another and their new organization. It can be very costly when good people or good clients leave. That's why it is critical for management to implement a technology strategy that quickly produces benefits and unites the participants. Merger Glue technologies can help humanize an unknown new entity and make people feel the new firm belongs to them. They can help create a distinct new identity and reduce uncertainty through clear communication to the individual. Most importantly, they can help clearly demonstrate to members and clients the promise, benefits and collective strength of the new firm.

Dan C. Felean a principal of PensEra Knowledge Technologies, a national consulting firm that specializes in knowledge management strategies and technologies for law firms and corporate law departments. See www.pensera.com.