A Conversation with Chris McDaniel, Cognicion

A Conversation with Chris McDaniel, Cognicion
  • Hi Chris -- thanks for taking time to chat with me.

    As I mentioned in my intro, Cognicion is relatively young, but the work that you are doing presumably predates Cognicion, the corporate entity. What factor(s) prompted the firm to formally launch Cognicion as a separate business unit?

  • Hey Zach, it’s my pleasure and thank you for having me. Yes, you are correct. While the corporate entity of Cognicion is 3 years old this month, we have been around for over 15 years as a service provider.

    In order to offer existing and new clients well-rounded capabilities and solutions, many firms have launched wholly-owned subsidiaries comprised of industry and business professionals who are not lawyers. Our COO and I have significant Big 4 consulting backgrounds while others on our team come from various firms, corporations and service providers. That diversity combined with operational independence allows Cognicion the benefit of strategic growth in our core area of eDiscovery as well as adjacent areas such as data privacy, information governance and contract management.

  • Three years in, do you have a better sense of the value of operating as a separate entity both for Cognicion as well as the law firm?

  • I think we have a good sense of the value of the organizational structure. Operating independently benefits Cognicion by allowing us to be more nimble with technology as we continually pressure test our existing tools and workflow, always looking to implement strategic applications and improvements. This, in turn, helps our law firm and corporate clients with operational benefits and cost-effectiveness. As a separate entity, we operate as a tactical business unit run by industry professionals with business backgrounds, searching for creative ways we can help our clients.

    For example, while our core projects include traditional eDiscovery-related data management and document review, in the past few years we have delivered on non-traditional projects such as contract management, document categorization for high-volume repositories and providing project management expertise for data privacy programs to our corporate clients.

    We are all about being great problem solvers first and foremost; we just happen to be in an area where Legal and Technology intersect. Designing, implementing and managing a breadth of effective services and solutions meant to solve challenges brings value to our clients.

  • Talk to me more about adjacent areas. How significant a role can solution providers play in the contract space?

  • We’ve had a significant role in the contract management space working alongside lawyers across multiple practice areas including Corporate, M&A, Real Estate, and Structured Finance. We are collaborating on workflow that leverages contract review and reporting technology and a reasonable amount of human intervention.

    The end product is a cost-effective, efficient solution for managing large volumes of contracts and agreements.

  • I know everyone’s favorite use case is M&A due diligence, but you mentioned a whole number of departments, not just M&A. What are the other use cases for large scale tech-enabled contract review?

  • That’s right, M&A due diligence is the typical use case for managing large volumes of contracts. We developed M&A workflow specific to the sell side and the buy side since their strategic goals and objectives are not exactly aligned. Using that workflow intelligence, we have expanded our use of contract technologies to other attorney teams.

    We have worked with the Real Estate attorneys to help their clients understand key provisions and terms in their property and lease agreements that will impact operational strategic planning. We have helped the Corporate attorneys understand the key terms and provisions in their operational and supplier contracts that will be impacted by new statutes and regulations. And, we have helped the Structured Finance attorneys query contract terms and conditions to understand their client’s financial obligations in various finance deals.

    Cognicion has worked with each area of law to reverse engineer the existing manual processes and develop a workable proof of concept process. Because each set of contract documents are unique, and each project has unique requirements, we are continually developing process specific and project specific strategic workflow that uses technology resources, along with human intervention at various points in the workflow to increase efficiencies and reduce costs for clients.

  • Can you describe how your team reverse engineered the process (I imagine this was no small task)?

  • Electronic discovery workflows have matured over the years with ever evolving technologies, standardized best practices and a community of experienced, often-certified professionals. In comparison, legal contract analysis requires complex information management and application tasks, each requiring a diverse array of data inputs, synthesis of factual information, using observed experience and inconsistent practices. And, until fairly recently, it has been accomplished by attorneys using brute force, without leveraging much technology.

    Developing workflow for contract review and management required trial and error collaboration with our clients. Our eDiscovery workflow breaks down the data management process into task-based operations. For example, data processing triage sifts collected data to the “only what you need to review” document sets. When we tried to apply that pre-review triage theory to the contract management process, the attorney’s response was often, “I know what documents I need to review, and I just do it.” We had to reverse engineer through proof of concept projects and honest feedback (including some difficult lessons learned). That allowed us to create a standardized contract review workflow process that can be modified to the contract document set, and the required information extraction.

  • I have to ask -- any "hard lessons learned" that you can share?

  • I wish our execution was flawless and the answer was "no," but the hard lessons usually lead to the most effective changes. Our hard lesson arrived when we assumed our eDiscovery workflow would translate to the contract management workflow. While there are some similarities between the two, we learned that they are apples and oranges. Particularly in the triage stage, the approach to training the software and the review team is unique. After seeing inefficiencies and lower-than-expected throughput, we had to pivot towards a more effective strategy. The result is a unique workflow that relies on consistent input from the lawyers, the technology and reviewers all collaborating throughout the process to get the best results.