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Thought Leaders In Cloud Computing: Michael Aginsky, CTO Of Gibbons P.C. (Part 3)

Posted on Wednesday, Aug 25th 2010

By guest author Shaloo Shalini and Bhavana Sharma

One of the main motivations for cloud adoption in the legal industry is the speed at which cloud-based offerings can be deployed. However, a big barrier to adoption is integration with existing on-premise enterprise applications. Within the legal industry, only the peripheral user-focused processes which have very basic integration requirements are the ones that have moved to the cloud. Michael discusses in this part of the interview that the primary driver for selecting a cloud-based offering at Gibbons is “business need and appropriate fit” followed by usability, integration capability with existing systems, governance, and security.

SM: What are your thoughts about business model changes with the advent of cloud computing? How are the business models of legal firms changing as you adopt cloud-based solutions? We have gone from a very expensive licensed software–based business model that was capital expenditure intensive to cloud computing, where the business model is based more on operational expenses and is relatively easy to deal with.

MA: I do not see much of a change in the business models of law firms that exist today. With cloud computing, we will certainly have the ability to add new services faster and with a much smaller capital investment on our part.

However, we are very careful about our data, where it is, and where it lives. And that will always be our view because we are in business to protect our clients. So, we are never going to jump onto the cloud bandwagon without addressing all of our core business requirements. I think we will not be there with both feet into the cloud and just move everything there, at least not in the foreseeable future. The cloud exists only to an extent in our current business model.

SM: Here, I am asking more about your purchase of IT applications. Has that changed because of the new cloud business model?

MA: We still have the traditional enterprise applications that we are going to purchase based on our needs and demands because we want to have that kind of control over our IT. In the case of cloud offerings, [we will get them] when they do meet our business needs and requirements, or if we are more in position to acquire them much faster provided there is no capital investments and large software licensing expense. Such changes are being approved much quicker because they are more of an operational day-to-day expense. As long as they bring value to the firm, they are approved much faster.

SM: And how do you think the cloud will affect the way you calculate the return on investment (ROI) for your IT investments?

MA: I think we are going to see much quicker ROI. We usually don’t work ROI into everything we do in the legal industry; it is not always applicable. This is just the way we run our business. It is more in terms of what value it brings to the firm. It is hard to calculate how much revenue we generate from having a product; it is really more about how much time it saves attorneys.

Nevertheless, for cloud purchases for which there is not significant initial expenditure, their value is seen is much sooner than if we had to justify the cost over a five-year lease period or something like that.

SM: When you think of buying cloud applications from various providers, to what extent does the variety of different business model come into play in your selection of these providers? Is it purely technical, or does your need for security and governance functions dominate and the business model remain incidental?

MA: The business model is not incidental. I think security and governance are our requirements, but what we look for first and foremost is integration and how tightly the application will work with our existing applications. We try to limit the number of applications and places people need to go. We try to keep all our systems very tightly integrated and talking to each other all the time. We look at the application as an end-user resource and for legal discovery and evaluate it from that perspective. Moreover, how well we can integrate it with our existing systems and processes, tie it together, and its usability are dealt with first. After this, we tackle security and governance issues. Those are secondary once we determine whether the application is a good fit for supporting our core business and making processes efficient.

SM: Can you elaborate on integration issues? Can give me some examples of the kind of cloud applications you are integrating into your enterprise system? How complicated has that integration been?

MA: In terms of what we have done for cloud-based applications, the level of integration we required was very low. It was mostly keeping user databases up to date and in sync. It was really a simple integration, such as just talking with components such as Active Directory and doing pushes and pulls of information and updates. Most vendors have that kind of stuff worked out.

The bigger applications we use here at Gibbons P.C. are document management systems (DMS) or record management systems (RMS). Those require much deeper levels of integration, such as keeping client and matter databases up to date between our accounting and other systems.

These are the bigger applications, and we have not yet come across vendors that are proposing that you do these things in the cloud. I think there are some big challenges in moving this relatively large people database full of information to the cloud. These databases have to keep information in sync all the time. Right now, we are doing it all pretty much in real time. To do that would be a challenge for most cloud platforms.

SM: And when you think about the future and the adoption of cloud computing at legal firms, what kind of integration would you like to see in terms of the big requirements you just talked about? What are your expectations for integration with respect to cloud-based offerings? Is it going to be the vendors doing the integration? Will you use third-party consulting companies to address your integration requirements, or will companies do the integration themselves? What is the configuration that you anticipate?

MA: I would like to see the vendors bring us applications that have application programming interfaces (APIs) exposed via Web services or something similar. Well, that has almost started to happen in some cases already. To be honest with you, what we need are Web services where we can work with data and data models that allow us to hook into them and do the pushes and pulls we need to do.

SM: It sounds as though the integration challenge is a barrier to your cloud adoption.

MA: Yes, it is a challenge for anything other than the real user-facing application right now. Integration is going to be a big hurdle in bringing any of our core enterprise business applications to the cloud.

This segment is part 3 in the series : Thought Leaders In Cloud Computing: Michael Aginsky, CTO Of Gibbons P.C.
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