Wolters Kluwer’s ELM Solutions Releases Major Claims Litigation Metrics Study

Global News

23
Aug
2017

Editor

Suggests Seven Key Metrics for Strengthening Strategic Oversight

Wolters Kluwer’s ELM Solutions has released a major new study that is intended to help self-insured companies and firms with claims defense and litigation programmes to identify key claims litigation metrics and the types of reports that can drive improvements to key performance indicators.

Claims organizations have a tremendous amount of data at their fingertips and leveraging that data can significantly improve performance and outcomes, especially if they use that data strategically to enhance performance. Applied properly, ELM Solutions says the 28 page guide can help firms improve the effectiveness of litigation management initiatives, so as to improve Allocated Loss Adjustment Expenses (i.e. controlling external costs associated with the litigation management process); Unallocated Loss Adjustment Expenses (i.e. making internal claim staff more efficient) and Indemnity (i.e. improving loss cost outcomes on specific litigated claims).

“Organizations demonstrate metrics maturity when they use metrics to identify improvement opportunities and then implement strategy that drives improvement in those targeted areas,” according to the white paper released this week and available on ELM Solutions website. “As organizations use metrics more effectively, their metrics maturity grows. Mature organizations have claim professionals who are familiar and comfortable with setting specific goals and managing to them.”

Metrics maturity does not require a high quantity of metrics and dozens of reports, the firm adds. “Any claims organization could create 50 reports on all aspects of their litigation business, but if those reports are not strategically designed to drive improvement, they are meaningless. Every single metric you publish should drive some discipline to improve results, reduce risk, or manage resources.”

Good reports can be an essential contributor to key metrics, ELM Solutions finds. This includes controlling legal costs; assuring predictability; managing claim inventory; evaluating law firms; managing panel counsel; creating efficiencies in daily case management; assigning cases to the most appropriate law firms and driving management’s priorities.

In the extensive study ELM Solutions recommends, where appropriate, that litigation metrics be shared with law firms. “Doing so will educate them regarding your priorities and how you measure success. Sharing this data also helps to ensure consistency, enhance communication, and set expectations,” the study’s authors argue. “Communicat­ing your metrics and performance expectations with law firms can provide a principled basis for requesting process changes, fee reductions, or staffing alterations. Be forthcoming with your firms, share your metrics, and give them insight as to how greatly they affect your ongoing success.

The seven core claims litigation metrics covered by the study are Total and Average Legal Spend; Average Rate/Real Average Rate; Total Spend by Law Firm; Open/Close Case Counts; Cycle Time, Law Firm Performance and Adherence to Budget.

The key claims litigation metrics are examined using sample reports to help illustrate what the data output of each metric might look like. ELM Solutions approaches the metrics by applying five different report types: Outcome Reports, Performance Reports, Exception Reports, Combined Reports and Analytic Reports.

The firm also provides the below guidance on each report so the metrics can be fully understood: 

• Outcome Reports: Outcome Reports provide the information most useful to management to determine overall performance and results of the claims defense program. Most Outcome Reports are segmented at a higher level (e.g. Organizational Unit or Claim Type).
• Performance Reports: Performance Reports usually mirror Outcome Reports, but provide measurement at a sufficiently more granular level to establish performance indicators for individuals, small groups, teams, and law firms.
• Exception Reports: Exception Reports are similar to Performance Reports but are used very tactically. They provide information at a very detailed level about claims, individuals, law firms, or activities capable of significantly affecting financial results, claim outcomes, and inventory management. As such, Exception Reports should promptly identify claims that are going awry, individuals who are failing to comply with crucial disciplines, events that impact management plans, etc.
• Combined Reports: Combined Reports usually provide information addressing several different aspects of one or more claims or law firms. They summarize all relevant information and support performance evaluation or strategy development relative to the topic presented.
• Analytic Reports: Analytic Reports are the most important of all reports as they disclose the areas of greatest possible improvement. They identify the segments of claims, law firms, tasks, matter types etc. for which careful management can most effectively reduce cost, loss, and inventory.

“Metrics offer a huge opportunity to identify your organization’s strengths and opportunities for improvement,” ELM Solutions adds. “You can find out what is working well and ensure those processes are continued and the responsible people get recognition for their efforts. In addition, you can ascertain were performance is lacking in order to put improvement plans in place. The seven core claims litigation metrics and associated sample reports presented in this white paper will help you determine how to use data to empower decisions that will positively impact your business.” 

Wolters Kluwer’s ELM Solutions provides enterprise software solutions that facilitate workflow and collaboration across the legal community. Earlier this month Corporate Vision magazine has bestowed its Best Enterprise Legal Management Platform Award upon Wolters Kluwer’s ELM Solutions. This is the second consecutive year that Wolters Kluwer has triumphed in the magazine’s Technology Innovator Awards series that celebrates excellence and innovation in technology.