Q&A: Bringing E-discovery In-House

The benefits, costs, and best practices for bringing e-discovery to your data center.

Why are enterprises increasingly interested in bringing e-discovery back on site? What are the benefits, costs, and downsides, and what best practices will help ensure a smooth transition? For answers, we turned to Jim McGann, vice president of information discovery at Index Engines, a firm that specializes in high-speed direct indexing technology to improve information retrieval.

Enterprise Strategies: Why are enterprises interested in bringing e-discovery in-house? What are the benefits such a move offers?

Jim McGann: We see enterprises becoming more proactive and bringing data discovery in-house in order to gain more control over the process and to reduce costs. By doing e-discovery internally, the expenses are significantly reduced. The annual savings can approach 75 percent if the volume of litigation in an enterprise is high. The process also creates an asset that can be reused by other initiatives such as archiving, security, and compliance. In-house discovery also minimizes external exposure to sensitive data and reduces project management overhead.

Enterprises often outsource a task (such as e-discovery) because it is cheaper or because IT resources are scarce and devoted to other projects. In an age of tight IT budgets, how can an enterprise cost-justify bringing e-discovery in-house?

For an enterprise facing frequent litigation, in-house e-discovery is actually much more cost-effective. Rather than recurring projects costs paid to service providers per event, the organization will be able to access discovered data repeatedly for only the initial project cost. Very often tapes contain either redundant or useless data (such as system files). Our experience with tape discovery has shown that typically less than 5 percent of data on tape is relevant. This data can be retained in an archive and then the tapes can either be recycled or shredded. The reuse of tapes is specific to each enterprise’s policy. By reducing the numbers of tapes kept in offsite storage and also by eliminating the number of tapes that need to be purchased, the investment in a tape remediation project typically pays for itself in less than one year.

In-house discovery allows legacy data to be discovered once, and the resulting index can then be reused over and over for future litigation. If discovery is outsourced, the same tapes/legacy data are often re-indexed per litigation event. This results in the enterprise paying many times over for the same data to be restored or accessed just so that event specific queries can be run. So there is a savings by spending less on redundant services, and also the savings of tape storage and tape purchases that a proactive discovery and remediation effort leads to.

Through the process of making data discoverable, stored information becomes an asset that is owned by the organization, and the work can be leveraged by other groups in the organization such as records management. If the data being discovered is from backup tapes, significant savings can also be realized through proactive tape remediation. Finding and extracting relevant data from tape eases future e-discovery requests, and also allows old tapes to be recycled and offsite storage costs to diminish. Overall, corporations are finding that by bringing the technology in-house it is not only cost-effective, but its use can be expanded to improve other business processes.

What are the downsides to in-house e-discovery? Aren't special skills needed that IT might not have?

In-house e-discovery is mostly automated, so it is rare that specialized skills are needed to process electronic data. The resources that are required are more on the business process and policy side. These resources exist in IT and need to manage this type of project to make it successful.

How do you know if bringing e-discovery in-house is the right move? If you should decide to transition e-discovery, why should the project be a priority?

There are several reasons to make in-house discovery a priority. If your organization is constantly facing litigation and managing the risk associated with lawsuits is important, that e-discovery should be brought in-house and proactively managed. By proactively discovering legacy data, a corporation is reducing the risk contained in this stored data. E-mail messages or files stored on tape can be identified and dealt with according to policy. Also, once valuable stored data is identified, it can be loaded into an archive. This allows an archive to become an immediate resource rather than forcing your company to wait for the archive’s usefulness to grow over time. Companies can easily spend hundreds of thousands of dollars per year just to store tapes offsite with no knowledge of what is on them. Proactive tape discovery allows these tapes to be remediated and allows IT to recapture the large portion of their budget spent on storage.

What's involved in bringing e-discovery in-house?

A well-planned in-house discovery project involves identifying the type and amount of data to be discovered. The time frame for the project also needs to be considered so that the required amount of technology can be acquired and the appropriate internal resources can be allocated. Once the internal goals have been determined, discovery technology vendors work with IT to determine the hardware and support services needed.

What are the technology challenges, and how can enterprises avoid them?

Deploying indexing technology that can keep up with the volume of data that exists in the enterprise is critical. You do not want indexing to be a bottleneck. Many platforms that index in the 40GB per hour range will keep you waiting for the data to be processed before actual discovery can begin. Also, the technology needs access to data in proprietary environments, such as e-mail servers (Exchange, Notes) and backup formats. Without unfettered access to these repositories, critical data will be left undiscovered.

What best practices should enterprises employ when bringing e-discovery inside their data center?

In-house e-discovery enables much more than the expected litigation readiness. Proactive data discovery also enables several data center best practices. With easy access to legacy data, enterprise IT teams now have the freedom to convert to a preferred backup environment and consolidate platforms they may have inherited from merger activity. Tape remediation allows large budgets spent on offsite storage to be recaptured and the relevant data to be added to an archive. Getting control of legacy data is a business best practice for any organization facing litigation or with large numbers of backup tapes.

What type of ROI can enterprises expect with in-house e-discovery?

We have found that in-house discovery of tape data pays for itself in less than one year. This is calculated just on the reduction of tape storage costs. The ROI would be even more significant if the costs of reactive e-discovery via service providers were considered.

How does Index Engines help?

Index Engines’ direct indexing technology enables easy access to legacy data stored offline in tapes without needing to first restore the data using the original backup software. Index Engines is an indexing solution that uses either high-speed network data management protocols (NDMPs) or multi-threaded NFS/CIFS scanning to index network data so systems can efficiently process data. Index Engines indexes at speeds that are several orders of magnitude faster than other indexing approaches, over 1 TB/hour/node.

Index Engines offers flexible implementation models to any enterprise by allowing IT to attain the goal of gaining control and accessing electronic stored information. The installation and interface eliminate the specialized skills needed for e-discovery efforts in the past. Index Engines makes it possible for any organization to take e-discovery in-house to reduce risk and save costs.