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It’s the Most Financial Time of the Year!

Written by Doug Austin, Editor of eDiscovery Today

The Christmas season may be the most wonderful (and financial, because it’s often expensive) season of the year for individuals, but we’re heading into the most financial season of the year for organizations. Not the autumn season and not even the football season.

It’s almost time for budget season!

Yes, it’s that time when many organizations work to finalize budgets for their various departments for the upcoming calendar or fiscal year. And that includes the legal department and other related departments to plan their budgets for information governance and eDiscovery expenses for 2022. Let’s look at some of the considerations and recommendations for this upcoming budget season.

The Current Business Environment

The quarterly eDiscovery Business Confidence Survey, which is published on Rob Robinson’s terrific Complex Discovery site always includes a question regarding the issue that survey respondents “feel will most impact the business of eDiscovery over the next six months” and one of six choices is “Budgetary Constraints”. A year ago (during the height of the COVID-19 pandemic) in the Fall survey, nearly half of respondents selected Budgetary Constraints as the top factor with 49.4% (which was still less than the 2020 Summer survey where 56% selected Budgetary Constraints). 

So, a year ago, budgets were essentially the controlling factor – over the other five factors combined – in impacting the business of eDiscovery.

Fast forward almost a year later and the 2021 Fall survey hasn’t been conducted yet (it is scheduled for next month), but the 2021 Summer survey has been – and the change has been dramatic. 

Budgetary Constraints was the fourth most selected factor – out of six – with only 17.8% of respondents selecting it as the factor they felt would most impact the business of eDiscovery. 

While that makes it seem as though budgets have a diminishing impact on eDiscovery spend, that survey was conducted from June 22 through July 6, when optimism related to the economic recovery from the pandemic was potentially at its height. 

However, the Delta variant surge of the COVID-19 virus has put eDiscovery business back into a state of uncertainty, as we saw last month with the ILTACON conference (and potentially upcoming in-person conferences).  It will be interesting to see what the 2021 Fall survey reveals next month.

Recommendations for an Uncertain Business Environment

With the impact of pandemic challenges to eDiscovery business on the rise again, organizations need to plan their eDiscovery budgets to address the uncertain business environment that exists today. Consider these recommendations when planning your information governance and eDiscovery budgets for 2022:

  • Savings Start at the Beginning: Even in an uncertain environment, data is growing like crazy within organizations – even more than before with so many working remotely and depending on collaboration apps to work.  Addressing the proportionality challenge by emphasizing budget spend more upstream within the EDRM life cycle will maximize the potential for savings.
  • Leverage Technology to Meet Today’s Challenges: The challenges associated with more data, more remote work, and more use cases to support – e.g., Data Subject Access Requests (DSARs) and Hart-Scott-Rodino (HSR) Second Requests to support M&A activity – could cause eDiscovery budgets to skyrocket. When planning your eDiscovery budget for 2022, now is the time to invest in technology to address those rising costs for the future.
  • To Address the Current Remote Work Environment, Head to the Cloud: eDiscovery services – including preservation, collection and review – have evolved to the point where conducting them remotely has become the norm and the legal team conducting these services is more dependent than ever on cloud-based eDiscovery solutions to conduct these services effectively. The “toolbox” of solutions for legal teams to do their jobs in eDiscovery today includes the cloud.

Conclusion

Budget season is the time when organizations need to consider their requirements for addressing the challenges associated with information governance and eDiscovery for the coming year carefully, especially in the current uncertain times we’re all facing.  Leveraging technology to address those challenges starts with budgetary planning to acquire, implement and deploy that technology to support your eDiscovery needs.  It’s the most financial time of the year!  Make the most of it!

Learn more about other considerations you should take for this year’s budgeting season.

And for more educational topics from me related to eDiscovery, cybersecurity and data privacy, feel free to follow my blog, eDiscovery Today!