Cisco is taking on health care costs. Could this initiative have implications for BigLaw? 

Cisco: Paging Dr. Info Tech ($) in Business Week (7/11/05) explains that Cisco is “quietly organizing Bay Area companies to support pay-for-performance in health care.” Sound familiar? I recently wrote about a new online services initiative spearheaded by Cisco and a consortium of large law departments in which it participates. So what does this have to do with large law firms (BigLaw)? Here is the money quote from Business Week:

“Experts think Silicon Valley’s nascent campaign could help usher in a new era of health care. The payoff, they say, is not so much the cost savings that typically come with the adoption of technology. The real goal is to build huge warehouses of data about how health care is delivered, what works, and what doesn’t. With that information, companies that pay for workers’ health care can insist on the adoption of more effective and cost-efficient treatments.”

Change a few words in this quote and you can easily imagine large law departments sharing e-billing data about the performance of outside counsel. As e-billing grows, the data to evaluate law firm performance becomes more readily available. And the use of this data will be not so much to spot the errant fax charge or impermissible two lawyers at a deposition; rather, it will be, as in health care, to examine what in law practice works and what does not. This is less about following detailed rules and more about overall report cards.

Subject to any legal and confidentiality issues, the leap from collecting performance data on health care to performance data on law firms does not seem so great. And with Cisco already participating in a consortium pushing an innovative online service, the leap in fact seems more like a small step. BigLaw CIOs should welcome any such leap – or step. Clearly, when outside counsel start to evaluate law performance and effectiveness, firms that use technology effectively will come out ahead.