The combination of Clyde & Co and BLM into a new legal giant involved key decisions about when and how to move business-critical data and phase out systems to manage risk effectively and maximise the union’s strategic advantage. Global head of finance systems, Jeremy Morris, outlines how it identified this path working with Pinnacle.
October’s Briefing/HSBC Law firm strategy and investment research for 2022/2023 found 70% of strategic leaders expected an increase in law firm merger and acquisition activity in the coming year. Where they transpire, these big moves mean a lot of background work on streamlining supporting systems to enable the great promise of the public-facing synergies to materialise — international reach, deeper market insight, approaches to client collaboration, or stronger complementary services.
One of the most headline-grabbing of recent mergers in the Briefing market was that of Clyde & Co and BLM. The result was a £700m firm operating from 60 cities worldwide when it completed in July 2022 — with greatly increased UK scale in casualty insurance in particular. While they had some systems in common, notably the pair had very different practice management systems (PMSs) to consolidate as rapidly as realistically possible. Indeed, BLM had multiple PMS instances of their own, which would all need migrating at different times.
The primary goals were quite standard for such a combination of assets, says Clyde & Co’s global head of finance systems Jeremy Morris: “We needed the risk systems ready for when the merger went live for onboarding, and then to bring finance systems together as soon as practical without disrupting business at either legacy firm.
“Key business management, such as modelling utilisation — comparing sets of data — is better with everybody on the same finance system. It also enables standardisation of collections at the matter level.”
While they may be time-sensitive, it’s fair to say the transition of finance systems is complex and can’t be rushed, while the need for a unified new business intake and conflicts system can’t be delayed. So, the merger team needs to bring strong expertise in both new business intake data requirements and the process of financial data conversion together. It’s a collaborative endeavour from the two skillsets — mirroring the way the two streams must be brought together to minimise disruption and strategically deliver the integration effort. It stands to reason that such collaboration will be off to a good start if the specialists sought to deliver the merged systems are familiar with working together – preferably part of the same organisation.
The firms certainly had this factor pinned down in its selection of technology and business transformation consultancy partner — Pinnacle. Morris says Clyde & Co had enjoyed positive experiences working with the team previously. It therefore turned this way again to manage the gradual move to both sides of the merger operating on a single PMS — which would be Elite 3E.
Another strong strategic drive was to shape a future with as few systems in the estate to manage as possible — improving cost management as well as efficiency. “We wanted to maintain our good handle on that factor. Some of the inherited systems were quite old for us to keep supporting. This introduces risk in itself so it was a priority to move those to a more modern environment,” Morris adds. Clyde & Co had worked with Pinnacle on its own move to Elite 3E back in 2016. But the firm particularly valued the breadth of system expertise the Pinnacle team could bring to bear (BLM was on Aderant), as well as the flexibility to fit into schedules within the overall timeframe and close attention to project management communication.
The role of the master database for a gradual PMS migration
Where the firm runs a unified risk process on day one and eventually uses a single instance of Elite 3E for financials, for a successful outcome it needs a way to manage complex parallel projects at the right pace. This is essential from both risk and cost perspectives.
Equipped with years of experience consolidating post-merger, Pinnacle suggested that Clyde & Co deploy a ‘master database’ between risk environments and PMSs to facilitate the required migration schedules. This contained all client and matter information, including indexes for the Elite 3E and Aderant PMSs respectively. It called for common datapoints to be mapped and any structural gaps filled as required.
The approach meant that finance system migration didn’t need to take place within quite the same tight timeframe as was critical for conflicts (see below). The relevant risk information was readily available, and Pinnacle ensured the data was structured such that all four finance systems could refer to it while gradual migration was in progress.
Pinnacle’s data migration team also had plenty of experience with Aderant, allowing the combined team to map points through to the correct fields and formats in 3E effectively. Core financial processes at work in the two firms were also compatible, which simplified many data migration rules.
Unified conflict clarity on day one
Conflict searching really couldn’t wait. It must always be ready for ‘day one’ for a combined firm to stay compliant. Given the sheer volumes of new instructions involved, it would have been seriously impractical to enter information into systems twice. And although both firms used a version of Intapp Intake and Conflicts for their onboarding, they also had different integrations to accommodate. So, as well as ensuring the conflict-search requirements were fully understood at the firm, Pinnacle created a new integration to clear conflicts using the Clyde & Co tools and only then populate the BLM environment. The day-one deadline was met.
Morris says: “Combining the firms’ workloads effectively required over half as many conflict-checks again, which would have been resource-intensive if duplicating the work on both sides.
“It was also important that we managed to develop a shared data taxonomy. While both firms were using a version of Intapp for inception, they had different forms collecting the data.”
But the overall result was the ability to understand and process conflicts as a single firm within a relatively short timeframe.
The platform for future improvement
Morris concludes: “With a total of four finance systems in the frame overall, final migration was always going to take some time — so phasing it out using the master database was clearly a lower-risk approach. Pinnacle not only ensured everything was implemented on time, but also that it was easily understood by those using the process.
“Rationalising the finance systems ultimately enables more unified cross-firm working and insight, with data transparency and increased efficiency for the lawyer — a common process for timekeeping, for example. We now have a push to make reporting more accessible at the appropriate level, as well as to drive data quality and curate continuously.”
Finally, Morris says he can’t fault Pinnacle’s close attention to how a firm’s process choices support its future-proofing strategy at all the key stages of this journey. Cost-effective and carefully managed compliance and consistency was the overarching goal, but the end (go-live) is not in fact the end. “The period post-go-live is also critical, where an understanding of how to fix production data was key. Pinnacle once again excelled and continued to support the business through to the end of the financial year,” he explains.
And they clearly acted as the ‘critical friend’ you want in a consultant partner: “They are very much an extension of our own delivery team, but also helped to ensure we made sensible choices about the amount of change that can realistically be managed at once.” The master database was just such a choice to handle complex changes differently but still deliver. “Change is always difficult and potentially disruptive, but clearly you want it to be as manageable as possible for people.
“For example, Pinnacle advised us to pick up the matter creation during a later stage of PMS migration — after conflict-checking — which was very sensible advice, and exactly what we proceeded to do.”
This case study was first published in Briefing Magazine’s 2023 June issue. >>>
To have a confidential conversation about how we could support your firm during a merger or acquisition process, contact us on info@pinnacle-oa.com