Today, an estimated 85 percent to 90 percent of the contentcreated within an organization exists electronically. Businessoperations generate vast volumes of electronically storedinformation (ESI)–not just system-generated data but unstructuredinformation. That unstructured ESI can include everything fromword-processing documents and spreadsheets to Web content anddigital assets to e-mail, voice-mail, instant messaging, and PDAtext messages.

No question: CIOs now have much more ESI to manage than they didjust five years ago, and the sources and formats of thisinformation are proliferating. The problem is that in the event oflitigation, some of that growing volume of ESI could prove to bediscoverable.

Managing electronically discoverable information matters now asnever before, and enterprise content management (ECM)technologies–content management, records management, search, andworkflow–are the key to effective management of that information.Here's why these technologies have become so critical.

Organizations that face the possibility of litigation have anobligation to preserve potentially discoverable information.Organizations can no longer claim searching for the requestedinformation is an undue burden. Following amendments to the FederalRules of Civil Procedure (FRCP) late in 2006, all that ESImentioned above is now subject to discovery so long as "theinformation can be obtained, translated if necessary by therespondent into reasonably usable form." Moreover, "the request mayspecify the form or forms in which the electronically storedinformation is to be produced." And the rules now require aprediscovery conference in which each side provides a list of therelevant ESI, including characteristics of the information and therepositories that house it.

The problem for most organizations is their unstructured data isnot easily searchable; it tends to be stored not just on serversbut in places such as hard drives, a multiplicity of shared drives,tape, and personal e-mail files (.PST files in Microsoft Exchangeand .NSF files in Lotus Notes)–all of which makes it difficult andcostly to retrieve. But once retrieved, the information must beanalyzed for relevance, then compiled and produced in a formatthat's usable by opposing counsel. Consider, too, the real riskthat some of the content should not have been retained in the firstplace or that large portions of the content may have been retainedfor periods that exceed the legal retention requirements.

And then there are the "rogue" repositories: removable storagedevices such as USB or "thumb" drives, and content sources such asinstant messaging, discussion boards, and blogs–channels for whichmany organizations have yet to develop effective policies andprocedures. While the ESI from these sources might not result fromstandardized, documented business processes, it's unfortunatelyprecisely the type of content that can get an organization introuble if the content gets into the wrong hands.

Finally, don't forget about repositories maintained by remoteagents (or other third-party contractors). Many organizationsunderstand the need for effective management of the ESI in therepositories that are under their direct control but have littlecontrol over or visibility into the documents that may be held bycaptive and independent agents or by contractors and remoteemployees. Typically, these parties aren't required (or incented)to follow the home organization's internal document or recordsmanagement policies; for instance, they may be using multifunctiondevices to scan in documents and then storing those documents in anungoverned manner.

The result of poor management of ESI is the compromise of theintegrity, confidentiality, and accessibility of business-criticalinformation. From the litigation discovery standpoint, it means anarduous and costly process to retrieve and produce the specific ESIthat's requested in the discovery phase of litigation.

What are the hard-dollar costs of responding to litigationdiscovery? Specific components include the costs associated withsearch and retrieval, information preparation, production andforensic costs, as well as the hardware and systems costs. Thenthere are the "miscellaneous" costs: the costs of hiring servicefirms to restore, search, and remove duplicate documents frombackup tapes. Consider, too, the opportunity cost (the money thatcould be put to other uses), the cost of disruption to normalbusiness processes during an ongoing search, or the business impactof unfavorable rulings. Companies that don't have a handle on theirESI can pay for it twice: first in the financial penalties, andthen in the loss of public and shareholder confidence.

For midsize to large enterprises, industry estimates fore-discovery costs range from $100,000 to $600,000–per lawsuit.

What's particularly striking about these litigation costs isthey are all repetitive, without leverage, on a per-litigationbasis–which is to say the above-mentioned costs will continue to beincurred until such a time as the organization has repeatableprocesses and systems built, implemented, and enforced to addressthe steps of the litigation discovery process. The absence of arepeatable process increases the likelihood that, faced withlitigation, an organization will find it difficult to determine thelevel of risk and to decide whether to settle or to contest thesuit. If the litigation proceeds, that organization could besanctioned for failure to produce evidence in a timely fashion.Even worse, a company could face sanction for destruction ofevidence, or spoliation–whether willful or inadvertent, because ofinadequate records retention policies and procedures. Andspoliation can lead to a number of sanctions, ranging from fines orpayment of the opposing attorney fees to refusal to allow testimonyto dismissals and default judgments.

Effective management of ESI is essential to e-discovery. Thedocument management capabilities of ECM, along with components forrecords management, are a cornerstone of any e-discovery program.ECM provides the capabilities to manage unstructured content, suchthat it can then be searched and analyzed for relevance, thencompiled and produced in a format that will be usable to the otherparty.

Records management components are essential to ensuredestruction of documents according to the disposition rules of yourcorporate records retention schedule as well as for legal hold andrelease of documents. This will ensure that the relevantinformation is preserved–and that it's preserved for only as longas you need it to respond to a specific litigation.

Search tools provide the ability to query an organization'svarious information sources and view the results. They can be usedto search Web content, databases, local or federated contentrepositories, or the information and unstructured data residing infile systems. Common search tools include free-text search,concept-based search, and federated search/universal search. Othersearch technologies and techniques available today include agents,behavioral search, entity extraction, sentiment analysis (a form ofsemantic analysis), and controlled vocabularies.

Today, most large organizations rely on third-party servicefirms within the legal community to assist in discovery efforts.The process used is very manual–and very costly: Crude searches areperformed, and the results are reviewed one by one (open adocument, scan through the content, and determine itsrelevance).

E-discovery has discrete triggers that initiate the process. Italso has specific tasks and time dependencies as well as definedroles for participants. Workflow or business process automation canhelp address these challenges by automating steps of thee-discovery process. Best-in-class firms have recognized this andare taking steps to leverage the capabilities of their existingsystems to lower their e-discovery costs, perhaps with the sametools they've been using to automate transaction processing-typetasks.

For years, the argument was the ECM technologies providedgreater efficiencies. Or they made it easier for users to shareinformation across the enterprise, thereby enabling an organizationto better leverage its information assets. All of this is quitetrue. But the changes to the FRCP upped the ante significantly,requiring an organization manage its ESI effectively in order toconduct discovery efforts efficiently and cost-effectively.Executive management took notice, and the result is CIOs now have amandate to find a way to manage their organizations' unstructuredcontent–across the enterprise and throughout the life cycle of thatcontent.

An organization that does not have technologies to assist insearching and retrieving ESI to meet litigation discovery-relatedrequests is at greater risk of sanctions, not to mention incurringhefty penalties–penalties that can be both hard dollar and softdollar in nature. That's why many organizations now are takingsteps to develop strategies that will enable them to fulfill theirlegal obligations–and to allow them to meet those obligations moreeasily, at far lower cost. But in the face of today's litigiousenvironment, the component technologies of ECM should be thecenterpiece of any risk management program.

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