February 2, 2004

By Jenny Carless, News@Cisco

By using Internet capabilities in key aspects of its business, Cisco Systems realized benefits of $2.1 billion during FY 2003. Cisco captures the benefits of Web-enabling its processes primarily in terms of cost avoidance and time efficiencies.

The Legal Services department, in particular, has garnered attention recently. It won the 2003 Computerworld Honors - Heroes of Innovation award for a scanning solution that substantially increases productivity and lowers costs, and InfoWorld recognized its digital workflow process as one of 100 outstanding IT projects implemented during 2002-2003.

Since 1999 the department, which has more than 100 employees working in 19 countries, has engaged a number of cost- and time-saving procedures - including a scanning workflow application, a Click Accept tool, electronic discovery and e-billing. These and other technology implementations have resulted in productivity benefits of as much as $100 million. Equally impressive is the fact that Cisco has less than half as many legal department employees per unit of revenue than comparable companies.

"The Internet is driving legal departments to be gateways to information, rather than gatekeepers - and that vision guides all of our efforts in this area," says Cisco General Counsel Mark Chandler. "This shift creates an opportunity for legal departments to grow their strategic role in the company's operations. By making key data available on a 24x7 basis to stakeholders who need it, company operations in a whole range of areas may be facilitated and productivity enhanced. The phrase that our clients hate, 'I'm waiting to hear back from legal,' should become extinct."

Award-Winning Scanning Solution

Like most in-house legal departments, Cisco Legal Services used to be inundated with paperwork. Attorneys relied on outsourcing and stored images on CDs to keep track of contracts and non-disclosure agreements (NDAs), but the process cost $50 to $60 or more per contract and caused two-week delays in accessing important documents.

Then the legal team combined some under-utilized resources, creative thinking and in-house-developed software to create a document scanning workflow system that increases security, improves productivity and has saved an estimated $262,000 overall (almost $20 per contract).

The legal department worked with a Xerox support team and Cisco Work Place Resources to take advantage of previously untapped capabilities (scanning and a network connection) of the Xerox copier-printers that are located on every floor in every Cisco building.

"By bringing imaging in-house, developing an integrated contract management solution and combining hardware scanning functionality with document management software, we've transformed the way our legal team works," explains Chandler. "Attorneys can now share and collaborate during all phases of contract development, and work-in-progress reports and NDAs are accessed easily by anyone with appropriate security clearance. More importantly, our inside clients and outside counsel can also access key documents on a 24x7 basis."

"Click Accept" Facilitates Online Acceptance

Another technology innovation is the Click Accept program - a new way of doing business that facilitates the online acceptance of terms and conditions.

Online acceptance itself isn't new. "What's unique is that we've made it into a Web utility that can be plugged in to any application, from placing orders to accessing technical support," says Chandler. "We've also designed our tool to meet the most demanding legal requirements for enforceability of electronically executed documents."

This single Click Accept platform reduces development and maintenance costs, helps ensure an enforceable contract and acts both as a single repository of 'accepted' contracts and a unique location for all contract templates. It also helps increase customer satisfaction and dramatically improves productivity.

To date, employing Click Accept for demonstration equipment loan agreements alone has freed up two full-time positions to take on other work and has reduced cycle time from 10 days to two. More than 80,000 transactions have been processed using this tool. Cisco has 10 types of contracts on Click Accept and a roadmap to implement an additional thirty-two. Conservative estimates place the number of annual transactions it can facilitate for Cisco at 6.5 million and the potential annual productivity benefits at a minimum of $10 million.

Electronic Discovery

Discovery is the process of gathering, reviewing and managing data and documents for litigation purposes. Traditionally, data collection and manipulation represents about 60 percent of the cost of a legal case, and it can literally bury a company and its legal counsel in paperwork.

Cisco now uses a Web-based discovery process that replaces the traditional model of gathering data, printing it all and then giving it to outside counsel. "We avoid printing costs while improving our ability to sort and search, we can easily weed out unnecessary or duplicative files, documents are securely shared on Cisco servers and we've created access logs that speed up the review process," explains Chandler.

The software, custom-designed by the Cisco litigation group, also provides a tactical advantage: significantly improved access to information.

"We're experiencing a 'perfect storm' on the discovery side of litigation," says Hopkins Guy of Orrick, Herrington & Sutcliffe, who has worked as outside counsel for Cisco on some litigation. "The three concurrent storms are the heightened requirements corporations face for document preservation, the electronic office which - despite early predictions - has actually resulted in more documents, and a growing number of devices that store documents."

"As an example, in 1990 I was involved in one large case that produced more than 3 million paper documents. Every page had to be managed, correlated and checked; it cost millions and took 18 to 24 months," he continues. "In contrast, using electronic discovery we recently processed five times as many documents in just five months."

E-Billing

Cisco has brought Web-enabled processes to its invoicing system, also.

An invoice from outside counsel must be reviewed by a number of different individuals, which can be a time-consuming process. Again, the use of e-billing saves time and money in comparison to the traditional approach: the e-billing process costs $50 less per invoice in paper handling and data entry costs.

These - and other - technology-enabled processes are testament to the fact that Cisco continuously looks for ways to extend its technological expertise not just externally, but within the company as well. "I want us to be a self-service legal information center to the furthest extent possible," says Chandler. "I'd like to see us put enough information online so employees and outside counsel can easily access what they need - whether that be contract templates, NDAs or any number of other resources - without having to call us."

"For law firms, in particular, the ability to license their knowledge to clients on a repetitive basis as opposed to charging them over and over to look up information will have inherent cost advantages that will allow those who adopt that model to capture an ever greater market share," Chandler adds. By using Internet capabilities and Web-enabled processes, Cisco Legal Services sets the standard for other legal departments and law firms alike that strive to improve customer service, increase productivity and decrease expenses.

Jenny Carless is a freelance writer based in Santa Cruz, CA.

For additional information, please contact: