“Vendors – A Dying Breed? Are we Pricing Ourselves Out of Business?

Introduction

The Digital Advantage has been busy, hence the gap in posts. This week’s post, therefore, will highlight two recent posts/articles from eDiscovery Journal . While we would like to see them drop the “e”, “Discovery Journal” is always a good read, BTW.


Vendors – A Dying Breed? Thoughts from IPRO Innovations

The first post “Vendors – A Dying Breed? Thoughts from IPRO Innovations”, by Greg Buckles, has some interesting observations from the recent IPRO conference just down the street (literally) from The Digital Advantage. 

“One interesting statistic from Jim King’s (IPRO CEO) keynote was a 17% decline in the number of IPRO service providers while the actual revenue they generated was up 12%. That’s right, the IPRO channel is shrinking (just like the eDiscovery market) but the volume is still growing. This resonated with the panelist perspectives on the increasing need to find alternatives to volume pricing ($/GB).”

A 12% increase in revenue, assuming year over year, is a healthy increase, especially in light of the economy, climate and commodity pricing. With regard to the 17% decrease in the size of the IPRO channel may well support the notion that the market is shrinking. That is certainly one interpretation. Or, might it be IPRO channel partners moving to other products? Could it be products like Viewpoint by Lateral data, Digital Reef and other processing/conversion engines are supplanting IPRO, LAW PreDiscovery and other more traditional simplistic processing engines? Could it be that there is finally a lot less scanning of paper in the world and that part of IPRO’s market is shrinking with those “vendors” shutting down those parts of their business, or in some cases going out of business? The point here is not to beat up on our friends down the street from us at IPRO. They are indeed a fine company with smart people and fine products. It is clear from IPRO’s product road map that they recognize the shift from the need for simple “vendors” and the need for feature rich filtering and reporting functionality. The commodity of “processing” data can be done by anyone on any street corner. You can find a hot dog on any street corner in NYC too. What you do with the hot dog, however, is a different matter all together. Some hot dog stands are better than others.

So, what do we need to do about this perception of high technology costs? Greg hits the nail right on the head:

"Providers need to differentiate their offerings with standardized processes, project expertise, transparent invoicing and metric-rich reporting to survive the transformation from commodity vendor to managed service provider."

In our business, what separates a “vendor” from a “service provider” or “trusted advisor” is what you do with that commodity product (processed data). While tool and technology are important – you need the right feature sets, reporting and reliability – how you use that technology is vital. Training, work flow, project management, accountability and the long list of other things one needs when dealing with vast amounts of information all have associated costs. Supporting the technology and making sure that technology is available at all times has a cost and requires expertise. Those services can’t be expected to be provided for free. The churn and burn mentality associated with the commodity of processing data is dangerous in the wrong hands. It is indeed highly competitive market within which we find ourselves and the competition is not shrinking. Although, as has been pointed out, some portions of the market are indeed consolidating. But for every consolidation, someone new seems to come along and on occasion, bringing something new to the table.

In other words, it is more than just about price, which brings us to Mikki’s post.

Are we Pricing Ourselves Out of Business?

As Mikki so astutely observes, the business of collection, processing, filtering, review and producing ESI is not just about technology price. “This is not a ‘push this button and you are done’ environment.” Mistakes can be costly. Entire careers have been flushed down the toilet and reputations lost forever because of a mistake or neglect during the ESI process. Providers or law firms that think they can provide a service for, using Mikki’s example, $75 per GB should raise a significant red flag. In an exchange with a “Vendor Veteran”:

“[H}ow can other vendors possibly compete with that and not sacrifice profit or quality”? My response? They probably can’t. But read the fine print before you panic. As discussed in the many blogs about pricing, the models can be very confusing and as a result it is difficult to compare apples to apples.” 

Either there are hidden costs that won’t appear until invoice time, or the service being provided is, well, a service you are buying from a “vendor”. Managing ESI is indeed about the cost of people, process and technology. The biggest mistake made today is to get so caught up in technology cost, because that cost is seen first. This in many cases drives a decision to choose the wrong technology, process or people. As Greg Buckles previously observed, we must move away from the GB consumption model. Technology cost should be flat and more in line the broader software licensing market. Well designed managed service models that flatten out the cost and separate the three components Mikki outlines – People, Process and Technology, are emerging and will continue to mature. Technology has in many ways reduced the labor costs at all levels. Processing technology is mature and higher volumes can be processed with fewer people. So, that portion of the labor cost has indeed gone down. We are reviewing fewer documents. Anyone reviewing 100% of everything collected, well, someone had better take a harder look at that process. So, review cost in a sense has gone down. However, as Mikki observes:

“However, the labor expertise required to handle ESI has not decreased. If anything, it has increased. So, while the amount charged by a service provider goes down, the cost of quality employees does not.”

Yet, we continue to hear mostly about the cost of that “vendor”. When, in reality, the largest cost, hands down, is not the cost of the technology, or the labor cost associated with processing, hosting or supporting data within an application. The largest single cost in litigation is not the cost of converting a word document to TIFF, branding the TIFF with a “bates” number, creating a load file, placing all that on a disk then shipping off to someone across the country. No, the largest cost during discovery is not even hosting millions of useless records for years because the right decisions were not made to filter out everything that is not absolutely needed to prosecute or defend a specific set of facts. Rather, the largest single costs associated with litigation today are legal fees within largely inefficient filtering and review methodologies. The act of taking 50, 100 or a thousand search terms and throwing them against millions of files and then reviewing the result and calling that an efficient process is at the root of what is driving up cost. Most of the cost of conducting discovery is in managing and using document evidence. Very few cases go to trial and very few documents are actually used during discovery or trial. Far less than 1% of the documents produced during discovery have any value to anyone, except maybe the bottom line for everyone except the ultimate client – the one paying all the bills. So, shouldn’t we be asking the hard questions around the document review part of the cost rather than focusing just on the commodity processing pricing? Shouldn’t it also be a time when the 35 document decision per hour review rate be a thing of the past? Isn’t it high time for us to stop reviewing millions of useless documents when only a few are needed? Greg and Mikki are correct; the days of the $1,000 GB processing charge are long gone.

So, maybe now we can focus on the people and process part of the equation and separate that cost from the cost of technology. Maybe, just maybe, it is time for us to turn our ear back to that “Trusted Advisor” that professional “service provider” that spends every day in the trenches focused on the entire project ROI and not just the cost of technology. After all, like hot dogs in NYC, you can buy technology from any “vendor”.

Technology Assisted Review (“TAR”) – We have been expecting you!

As predicted in The Digital Advantage January post, LegalTech – Technology Assisted Review will be the theme, the buzz at LegalTech was indeed TAR.  Some will know the technology features as “Predictive Coding”, “Automated Review” or any number of other terms being used to explain what is at its core the same basic technology, despite what some would have you believe.  A recent Forbes article really presents the current problem with what should otherwise be quick adoption of this technology.  What Technology-Assisted Electronic Discovery Teaches Us About The Role Of Humans In Technology.

Some continue to think that courts are going to somehow sign off on “Predictive Coding”. 

Given the significant benefits that technology-assisted review can bring to e-discovery from the dual perspectives of quality and cost, expert commentators have asked a key question: Why isn’t everyone using it? Of the 11 e-discovery vendors surveyed by Kershaw & Howie, “[t]he most mentioned reason cited by respondents was uncertainty or fear about whether judges will accept predictive coding.” Kershaw & Howie, Crash or Soar (supra).

For the love of Pete, please stop thinking of this technology as something that the courts are going to “sign-off” on!! They will not.  Judge Peck said just that in the aforementioned Forbes article.   

“Until there is a judicial opinion approving (or even critiquing) the use of predictive coding, counsel will just have to rely on this article as a sign of judicial approval. In my opinion, computer-assisted coding should be used in those cases where it will help “secure the just, speedy, and inexpensive” determination of cases in our e-discovery world.”

The courts have for years encouraged the parties to cooperate and come to agreement on the filtering methods.  This attitude of expected cooperation on the discovery process is nothing new.  It is not something that the technologist dreamed up.  When you read the rules of any state or federal court, you will find agreement and cooperation mentioned frequently.  While most “predictive coding” applications are built upon the same basic statistical algorithms and linguistic pattern detection, they don’t all always achieve the same result.  This is because that how you conduct the analysis – the workflow is critical to the end result.  TAR is not the silver bullet alone.  Lawyers SHOULD NOT have to defend the technology – how the algorithms work, or what the technology does or does not do. Instead, we should focus on the workflow and the end result.  The technology being utilized should be transparent.  The workflow and end result should be based upon what a human decides is relevant.  For us at The Digital Advantage, there are really only two types of filters that need be explained. 

Objective Filters:  Objective filters are essentially filters that can be applied without any “subjective” reasoning.  File type and date range are two common examples (not an exhaustive list) of filters applied in most cases. These filters should not be considered work product.  Objective filters are often disclosed and agreed upon between the parties. 

 Subjective Filters:  Subjective judgment is applied to document decisions in most cases.  When a lawyer reviews a document, the “mental impressions” that lawyer makes is generally considered work product.  In the old days, we did not disclose how many “boxes” we reviewed to arrive at a production that may only be a few documents, or a few boxes out of hundreds.  We did not disclose what file cabinets were opened, or who was interviewed.  Then as is the case today, that production would occur in one of two forms (generally speaking).  Documents are either produced in their “usual course of business”, or “by request.”  In the “old days” we avoided producing “by request” as if it were the plague.  Search terms today are often used, and should often be disclosed as an “objective” filter.  A term is indeed an objective filter, but you may arrive at the use of a term using subjective factors.  You may even use “predictive” technology that, in its simplest form, looks for common words, concepts and patterns.  Either a document contains that word (or some variation) or it does not.  How you arrived at the term, however, may well be subjective and protected work product (some lawyer will make that call).  After all, attorneys are officers of the court and when responses are provided, the attorney for each party is representing that a diligent search has been conducted and that there has been compliance with the requests, or the appropriate objections have been lodged.   

As Jim Wagner recently wrote in his blog: “So, welcome to 2012, predictive coding. We’ve been expecting you.”  The Digital Advantage adds this warning: Don’t expect TAR to be a silver bullet. Without the right workflow, checks, balances and quality control, technology like this in the wrong hands can yield undesired results. So, if you are waiting on this technology to become “defensible” or some court to sign off on this technology or that, you will have a long wait. Meanwhile, the world is going to pass you by. If your practice is based upon a lot of document review hours, you may wake up one day and not recognize the world you live in. TAR is here and it is not going anywhere. There is plenty of help available for you.

The "Cloud" is NOT new

In the old days, those days before we all had a PC on our desk, there were "mainframes" and "dumb terminals".   Technology was delivered from a central location where all data was kept and delivered to what were essentially monitors and keyboards.  Data was delivered from a “Cloud”.  Then came the PC and computer power and storage were distributed and the "main frame" started to go the way of the dinosaur.  Well, that dinosaur is back it appears.  Some call it the "Cloud" as if the concept is new and novel. It is not.  Even in the modern day of the PC, much of the data we access today is in fact somewhere other than on our PC.  In some cases, we access data sitting on a server in another room, another floor, across the state, across the country or even on the other side of the world.  To us, the average user, we often don't really know or in fact care where our data originates, as long as it is safe and available.  Yes, sales folk, CIO's and those technical types want us to think that "Cloud" is something magical, new and different, when it’s not.  That is not to say that the concept of keeping data in a "Cloud" is not important.  For a law firm, as an example, not having to deal with managing servers, software and all the associated infrastructure to simply access documents is frankly in most cases much more cost effective when managed by a service provider who already has everything they need in terms of technology.  Most service providers in this business have been delivering "Cloud" technology for years, so let’s not keep thinking of this as a new thing. The "Cloud" is old; we are just using it in a different way.  Who knows, we may well return to the days of dumb terminals and mainframes. Wait, we are already there, but we call them "Smart".  And, there is this thing called the iCloud where something called an iPad accesses information in the "Cloud".  We have indeed come full circle it appears.

LegalTech – Technology Assisted Review will be the theme.

As LegalTech approaches, our software friends madly scramble to throw up their ground shaking new features.  LegalTech is the platform most in this space use to launch new products and features. Legal service providers and software company employees in the space may out number law firm and corporate attendees, but corporations and law firms not in attendance this year will miss what some believe, including The Digital Advantage, will be a year when some truly amazing technology advances are achieved and showcased. 
This year several companies are announcing some truly ground shaking technology that, if used properly, will change how ESI is managed, filtered, reviewed and produced.  This year, the overwhelming theme at LegalTech will be the announcement of new "technology assisted review" features to some products where those features where not previously present.

The Digital Advantage has been following and writing about “technology assisted review” for some time.[1].  Technology assisted review is not new.  Recommind Inc, Orcatec, Equivio and others have had similar features on the market for some time.  The Symantec and Lateral Data products highlighted below, however, in The Digital Advantage's opinion, are taking a new and fresh approach that will allow legal professionals the ability to use and rely on this technology, without having to defend a single technology by retaining a PhD to explain how everything works.   Both applications contain workflow driven features where lawyers only need defend their workflow and review methodology rather than what a technology does, or does not do.   The two applications highlighted below are announcing these new features to their products just before and during LegalTech.   The list of providers releasing technology assisted review features is a long one, and this is by no means an exhaustive list of providers.  The discussion is simply those with which The Digital Advantage has firsthand knowledge. 

Symantec Announces “Transparent Predictive Coding”

On January 23, Symantec will officially announce an upcoming feature set for the Review & Production Module of the Clearwell eDiscovery Platform that The Digital Advantage agrees that when used in conjunction with a proven and well planned workflow and methodology, will streamline legal review significantly. This new functionality, Symantec calls “Transparent Predictive Coding”, will deliver the ability to create a flexible and intuitive workflow to help leverage technology during human driven review. Clearwell eDiscovery Platform works in much the same way as the “predictive” technology platforms that came before it and can automatically predict document relevance in order to simplify and streamline document review. The difference here, however, is that Clearwell has clearly learned from those early adopters and provided flexibility in how this technology can be used. When coupled with the right methodology, the net result will be a more defensible review process at significantly reduced cost.

Clearwell's Transparent predictive coding highlights the following specific features:

• Smart Sampling – The ability to target specific documents sets
• Smart Tagging – Automating pre-classified criteria that has been tested
• Prediction Insight – Greater transparency into what is being “predicted”
• Prediction Workflow Management – Flexibility
• Prediction Analytics – Strong reporting and transparency
• Prediction Templates – Ability to automate and repeat what works
• Review Quality Control – Customizable QC

Viewpoint by Lateral Data announces “Assisted Review”

Lateral Data’s Viewpoint software is an all-inclusive e-Discovery platform.  They too are announcing at LegalTech a version of Predictive Coding.  Viewpoint “Assisted Review” applies advanced technology also designed to help review teams reduce costs by reviewing fewer documents in less time. Viewpoint’s Assisted Review is completely integrated into the Viewpoint platform and is not a “tacked-on” product providing separate installation, training and complexity. There is no need for complex, time-consuming imports, exports or duplicative files transfers between disparate software products to get advanced “assisted review” analytics.  This will save considerable time over other products with similar features. When coupled with a proven workflow and methodology, Viewpoint’s “assisted review” features should prove to be a considerable upgrade to an already strong product.  Here are some of the Key Benefits:

• No additional cost - Viewpoint Assisted Review is included with every Viewpoint Enterprise Subscription license. 
• Complete integration - Not a “tacked-on” third-party tool. No additional training or installation required.
• Strong Analytics - Leverages Viewpoint’s already proven built-in analytical tools to build efficient sample sets for predictive analysis.
• Advanced Filtering - Viewpoint Assisted Review can be added to traditional culling techniques (e.g. date range or keyword filtering) to ensure the lowest possible quantity of documents are reviewed, with the highest possible relevancy rate.
• Early Data Assessment (EDA) - The most highly relevant documents in a dataset can be easily isolated. 
• Quality Control - Once a standard first level review has been completed, users can compare results to easily find and correct discrepancies.

Conclusion

Technological innovation runs in cycles and indeed technology assisted review may be an up cycle.   Just because something is bright and shining does not necessarily mean it’s a good thing.  Don’t get sucked into the mindset that technology solves all problems by itself, or you will be sadly disappointed.  Technology is only as good as the designers who create it and those who use it.  The “rubber meets the road” at the intersection of Human and Machine.  Not to be confused with human vs. machine, despite what some would have us think.  Technology assisted review is not going to replace lawyers anytime soon, although fewer numbers will hopefully be needed to do more with less.  But, that was inevitable wasn’t it?  If you are going to invest in Technology, compliment it with a sound implementation plan, integrate sound technology with a proven process and have smart people marrying it all together.    This is how you can maximize your technological investment and benefit from some truly useful technology in the right hands. 

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[1] See "Predictive Coding: Angel or Demon"  The Digital Advantage, March 2011. 

The Dark Side of Review Costs

Many blog posts and articles of the past have been prompted by Law.Com articles.  Anytime writings prompt discussion and change, articles are useful whether you agree with the journalist or not.  A recent article prompts this discussion and would fall in the partially agree to strongly disagree category. 

Evan Koblentz’s post “The Dark Side of E-Discovery Pricing” has prompted some emotional responses from “vendors” and lawyers alike.  The upshot of the article is that e-Discovery “vendors” are hiding the true costs.  Inflated pricing is the suggestion, although Evan is not that direct. 

Evan’s post talks about an exchange with some unnamed CEO of an eDiscovery company that stated the following when asked about cost: 

"[The CEO] believes people don't understand how e-discovery is priced or why it costs so much. This trend of price reduction will negatively effect the quality of the discovery process, encourage poor results and further cloud the visibility and understanding of the pricing structure behind the discovery process. ... Yes, the e-discovery process can be expensive but if you reduce the cost or offer free services you will jeopardize the quality and it will cost clients more in the long run."

Evan took issue with that statement writing: 

“Unfortunately, vendors being vague about pricing is the norm, not the exception. The majority of times when I interview companies about their legal technology products, and ask what about costs, they answer, "It depends," followed by numerous reasons why -- some valid, in my opinion, some not. But at least half of the time they do tell me the approximate typical cost, lest customers (and reporters) assume that non-answers mean it's very expensive.”

At first blush, I emotionally and loyally want to side with my competitor here (that unnamed CEO Evan mentions).  While true that some “vendors” do in fact have a hard time explaining or defending their cost models, the good ones in fact do not.  However, figuring out what anything costs requires enough information about what it is you are being asked to do.  Lawyers by and large don’t understand data preservation, processing, filtering techniques, production formats or really most of the issues that arise with data and the importance of doing it right.  Not in terms of something bad happening in court – that fear that Evan writes about.  Rather, in terms of what it is going to cost when you don’t do it right just to get that technology cost down.   Those ignorant of the process don’t understand the large volumes of information corporations are stashing away and are surprised when 10 witnesses have 1,000,000 files between them - literally.  And to someone like Evan, who has likely never darkened a court room door, put an exhibit sticker on actual useful piece of evidence, much less worked the business end of a law suit, it might seem like something that should be simple.  To someone who has spent literally decades supporting lawyers as has this commentator, they know that much of the effort in discovery is in fact wasted effort.  In any case of any size, there are quite literally a handful of documents that have any value to the actual lawyers who will have to stand up in court and use them.  Yet, lawyers are asking “vendors” to process literally billions of files every day in any given corner of the country. Evan is right, cost is out of control. But, the cost that is out of control goes beyond technology cost.

I recently had the great honor to sit with my old friend Pam Radford of Legal Media, Inc. and we reminisce about all of our trials over the years (her list is much longer than mine). 

We talked about how evidence is presented today vs. 10 years ago.  I explained how much time and effort we spend today in discovery (where I spend all of my time these days) on the unimportant.  Processing, filtering, reviewing and producing millions of files that frankly have no value to someone like Pam who is interested only in what the lawyers will use at deposition or trial.  That kind of effort is indeed expensive no matter how much you beat on the “vendor” about price.  Pressing the “vendors” to drive the unit cost down does not address the real problem, however.  That CEO is right.  At some point the price gets driven down so far that corners are cut.  Whole sale processing and review of large amounts of data become the norm.  Untenable search and filtering techniques are used because doing it right is considered “expensive”.  The real problem - attorney’s fees – does not get addressed.  Those that have actually seen the inside of the courtroom have to admit that the real problem is too much information and not enough decision about what IS important.  When you consider that on average 1,000 documents will cost $1,000 to review at $100 per hour (if you’re lucky enough to get a review rate that low), using cut rate pricing and technology, often 80% of what has to be reviewed is useless, the value of filter advice and technology becomes apparent.  But you have to be willing to listen to a new, proven approach.   Evan is right.  “Pricing” should be simpler.  Evan is just a journalist and in many ways like our clients in terms of being ill-equipped to understand what IT will cost. 

When considering cost, IT really does “depend”.   How much you spend depends largely on what the lawyers wants done and whether they will consider defensible filtering methods that will keep from processing and reviewing (the largest cost) a bunch of irrelevant information.  IT will depend upon how much “exception handling” is required.  IT will depend upon whether, as has been the case before, some lawyer wants all excel spreadsheets hand formatted before everything is tiffed (today a useless, wasted effort) before production as opposed to producing native files.  IT depends upon whether the corporation will listen to advice and spend some time and money toward reducing the amount of email they retain through unmanaged PST files (as an example).

So, Evan, consider interviewing “service providers” as opposed to a "vendor".  A vendor is someone who sells hot dogs on the street corner in NYC.  Or, in our business they bring cookies and can take care of your copy job needs as well.  Your readers can find a vendor with an eDiscovery application anywhere and that vendor will probably do the work at a very low rate just to get your business.  And then there are those cookies.  If all you are focused upon is that technology cost, and miss the real cost of review, you miss the most important component of the ROI.  A “service provider” is someone who has a great deal of experience and as your partner will help you determine the most cost effective approach based upon experience.  EDiscovery is not just a technology pricing cost analysis.  Indeed, technology cost is about 20% of the overall cost of discovery.  Paying lawyers to shift through all that unimportant information using scattershot filtering methods, or insisting upon reviewing everything is the real problem that needs solving.  Who do you want solving that problem?  A vendor, or a real trusted advisor that has proven methods for solving the problem, but at a higher rate than that vendor?

Measure twice, cut once! Are you measuring for success?

Most of us have heard this old English proverb many times. My grandfather who was a carpenter used to say it all the time, and not just in connection with building cabinets, which is what he did for a living for almost 50 years. It simply refers to double checking your measurements before you cut something to prevent wasting material. That makes sense doesn’t it? If you cut something too short, you can’t uncut it. The damage is done if you’re off the mark.


In the legal biz, we have historically not been too keen on measurements. Success or failure has been our yardstick. Either you win, or you lose. Here’s another proverb – “You’re only as good as your last trial.” We have historically not had measuring mechanisms in the legal industry, so outside of the result, there has not been many measurements. Not a lot of accountability for eliminating waste. All of that has changed. With technology, we have lots ways to measure, as an example, a document review. Anyone associated with review today knows there is a great deal of wasted effort. After all, in a case of any size, there are only so many documents that can be used at deposition or at trial. Yet, there is a great deal of information to sort through. Document review and the associated discovery is the major cost component of any piece of litigation. Are your lawyers measuring and controlling wasted effort? Here are but a few of the many things that can be measured.

• Culling Rates – What is being eliminated prior to review and at what rate? What are the duplication rates? Do you know?

• Documents Decisions Per Hour (DDH) – The rate at which a reviewer or group of reviewers review documents. Measuring this rate will tell you how much a review will cost. The slower the review, the more it will cost. What is the speed of your review, what will it cost at the current rate, and when will the review complete? Do you know?

• Response Rate – A traditional review everything process will generally yield very low responsive rates - 10% - 15% at best, meaning 85 – 95% of what is being reviewed is wasted effort. Whereas, when a sound culling methodology is used, a much higher percentage of what gets reviewed actually ends up being responsive. Do you know what your responsive rate and how much of the effort is wasted on the unimportant?

• Quality – Measuring the quality of a review is critical in conducting on the spot training for those who need it and eliminating those that are not successful. What is the project error rate, do you know?

There are obviously many other things that can be measured, but the above four are critical. How are you measuring the progress of your project?

PST – The RAT of ESI

A Personal Storage Table, better known as the “PST”, is the RAT of the ESI world.  A PST is an archive file that Microsoft Outlook users use to manage email messages, calendar items and other things normally managed by Outlook.  A PST file is usually stored on a user’s hard drive, or on a network share, as opposed to archived email managed by Microsoft Exchange or Symantec’s Enterprise Vault.  A PST email archive is usually created by individual users to store email outside of the corporate email environment and circumvent server storage quotas.  That 100 MB limit that for me is reached in the first two hours of the day.  As a result, these packRAT users are creating thousands of unmanaged files across the enterprise.  Because these personal folders are stored on individual work stations rather than on a centralized email systems, the corporate retention policies become unenforceable.  While IT solves their problem of keeping the email environment manageable, out of sight, out of mind, considerable increase in legal risk is created by keeping too much information.  While that archived email may be out of the sight of IT, legal is going to come looking and find a lot of information.  It won’t be good news that engineer has 5 years of PST archives on his laptop.  So much information, in fact, that with Outlook 2007, MS increased the functional limit of a PST file from 2 GB, to 20 GB!  Of course, a 20 GB PST won’t perform very well for the user, no matter what Microsoft says, but certainly well north of the previous 2 GB functional limit, which means a user will keep email far longer.  Thanks Microsoft!  Newer versions are going to give us some help with archives, but it will take years for the market to upgrade. 

Each GB of PST file size can contain 10,000 – 35,000 email or more. So, 20 GBs of PSTs could contain 500,000 email messages. Of course, the weight of an email in terms of GB size depends on the size of attachments. A company culture that tends to send a lot of physical attachments to email, as opposed to sending links to document libraries in SharePoint or other Document Management Systems (“DMS”), for example. With those document counts, it takes only a few PackRAT custodians to generate millions of files. When the lawyers come knocking for those PST files, usually scattered across the network and on user drives, the volume of information that must be processed and sorted through can be very, very costly.

There are a few steps you can take that will help.  Doing nothing and letting those RATs spread is going to make the organization sick.

1.  Increase the mail box limit to a reasonable size commensurate with today’s eSociety. Say 1 GB. Find a way to enforce retention schedules.

2.  Utilize email archiving application. Yes, it will cost money, but it will save a ton even if you don’t do another thing but enforce your retention/destruction policies. Can’t afford the implement email archiving software – outsource to the cloud.

3. Ban the PST file. Unmanaged email volume is killing you. Users archive within the system, or not at all.

4. DO NOT journal PST files!!! You will create a great deal of effort. Simply place a stake in the ground and ban them going forward.

5. Put a long term plan together to phase out (via retention policy enforcement) historical PST files starting with a voluntary destruction of out of date email archives for all users not on legal hold.