CEO of Hunoval Law Firm: Lean Six Sigma was a "lighbulb moment" (transcript)

Six Sigma and the legal profession are two things that we don’t often think of together. Legal work is too specialized and not routine enough for a process improvement method technique that was honed in the manufacturing factories of Motorola. Or is it?

Not so, according to Matt Hunoval and Kevin Divine from Hunoval Law Firm. The company, which provides default legal services to mortgage lenders, is one of the first law firms in the world to employ Six Sigma techniques. In this PEX Network interview, Matt Hunoval, CEO of the firm, and Kevin Divine, CIO, discuss how they got involved with Six Sigma and how it’s been transforming their business.

Editor’s note: This is a transcript of a video interview. Watch the original interview here.

Even she can use a little bit of Six Sigma…

PEX Network: Matt, turning to you: Six Sigma and the legal profession are two things that we don’t often think of together. What was it that made you decide to get interested in process improvement?

Matt Hunoval: This will require a little context and history, so bear with me! We engaged Kevin Divine as a consultant for information technology purposes probably a year before we really got serious about Lean Six Sigma. Kevin is our CIO and the one driving a lot of the day-to-day process improvement efforts within the firm. That was about two and a half years ago.

He was encamped in our office approximately 30 to 35 hours a week and during that time I got to know him a little bit better. He started talking about Lean Six Sigma and its origins and genesis in the manufacturing context. He has ample experience in some major financial institutions, got his Black Belt at GE, and in my particular space in the legal field we have a highly process-driven practice.

There’s not a lot of great differences in detail between each case and, in fact, the pejorative or negative term that some people use for a firm like mine that is a high-volume practice is that we’re a "mill". Whether that’s true or not, there may be at least a grain or kernel of truth in that - again, high-process, high-volume.

So, a management discipline that has had great success in a manufacturing context, in an analogous way there’s got to be some overlap in a high-volume, highly process-driven legal environment.

That was my light bulb moment.

So, we ran a couple of very small-scale pilot projects and the results of those exceeded even my loftiest expectations.

At that point we brought Kevin on full time and really went in full hilt. We partnered with the University of North Carolina at Charlotte, a major research institution, to develop a customized training curriculum just for our firm, around our processes. The projects that are done in order for the students in the classes to get their green belts are focused on actual real life, real world, what we are doing in my law firm at the time, so it’s not abstract book learning.

Particularly for my labour force, especially some of the lower level staff, the curriculum has to be pretty hands-on and tangible to what they do on a day-to-day basis. That’s how things got started.

PEX Network: What has the experience been like so far?

Matt Hunoval: There are three main things I would like to emphasize. Going into it, especially after we ran a few pilot projects, I knew that we would attain real operational benefits - increased efficiencies and reduction in errors - and it would help us run a better, more efficient law firm management.

Currently about one third of our workforce is green belt certified or higher - each has had a project somehow some way focused on what we do. So we are able to quantify in very real ways how that has benefited either us or our clients. I knew these operational benefits would occur, and that has borne out.

Secondly, there has been a somewhat unintentional but very real marketing benefit. A lot of our clients are major financial institutions. I won’t name them but among them are some of the top banks and financial institutions in this country. They’ve been talking this language – Lean Six Sigma, process improvement – for the better part of 20 years. It’s in their blood. It’s in their DNA. They talk it.

So, to all of a sudden have a lawyer or a law firm come and start speaking the same language really resonates with my target client base. That wasn’t intentional but as we have gone further down this path it has really resonated with our clients.

The third piece is employee engagement. In the work I do, it’s very process-heavy and high-volume. Over half of my workforce does not have a college education and so they tend to see my firm and others in my space as almost interchangeable. To get folks engaged and be excited and have a pride about where they work and what they’re associated with - this cutting edge effort - that was a very big part of what we’re doing.

Again, to date we have about one third of our workforce green belt certified or better. By the end of this year, 2014, we should be around two thirds, and my intent, is to foster a sense that we’re different, we’re better, we’re a cut above, and also to offer professional development. I would love everyone to stay forever and ever, but I know that’s not going to happen. But if they can walk away and I can give them something that they can’t get anywhere else; this is part of my family and I feel good as the owner of the business about being able to provide that for them.

PEX Network: So Kevin, I’d like to turn to you now. I understand that you’ve really been instrumental in introducing this new approach at the law firm. But your background is actually from corporate America. What’s been your experience? How has it differed from some of the other experiences that you’ve had?

Kevin Divine: I came from GE, Xerox, Bank of America, Wells Fargo and worked in finance and banking for the last 12 years. I was introduced in a consulting relationship with Hunoval Law Firm, and through a couple of experiments, a couple of projects that we did, we proved our case with Six Sigma and Matt embraced it and brought us on.

PEX Network: So it would seem to me that the corporate environment is quite different than the legal one. Did you find that you had to change your approach at all when introducing the concepts in a legal context?

Kevin Divine: We did change our approach a little bit. Initially, we didn’t really reference Six Sigma or try to introduce all of the language that goes with Six Sigma. We did it as a general business process improvement project. We tried to simplify the concepts to a level that it wasn’t intimidating. Once we got through a few projects though, we started to ramp that up a little bit, and clearly the results spoke for themselves. So that made it much more easy for the law firm to accept what we were trying to do, from the paralegals all the way up through attorneys.

PEX Network: Can you give me an example of some of the work that you’ve done? What are some of the processes that you’ve been focusing on?

Kevin Divine: Initially we started out with a lot of the high volume, repetitive processes that we do. "Notice of Hearing" first legal filings is one of the primary areas that we looked at. In those cases, we don’t get paid until we submit that first legal filing. Our clients are looking for those types of moves initially, and they do measure us against how quickly we can file those.

So, in looking at our clients scorecard and how we were measuring - and knowing that they measure us against our competition the same way - we really wanted to excel. So we picked those high-volume, highly repetitive, processes and tackled those first. Those were the significant results that Matt was referencing just a few minutes ago. And the "Notice of Hearing" for one of our states, we managed to carve out an entire month from the timeline. We were able to calculate for our client that translated to over $1 million in savings on their behalf.

PEX Network: And what have been some of the key challenges then along the way, from your perspective?

Kevin Divine: Well, clearly the industry has a tradition. The attorneys run the firms. They’re the people that are in control. They’re the management teams generally. Usually they employ other people to take care of their day-to-day clerical tasks and that kind of thing.

It’s a new concept for the law firm to bring in additional executives and management, to help run the firm, if you will. Specifically using process improvement, process excellence techniques, to better achieve those goals that they’re looking at is a new concept.

For me personally, not being an attorney and coming in from a financial and Six Sigma background, I had to flex a little bit and address those egos. Because there are some there. But once we proved our results, it became much, much easier.

Plus, in the program that we’re running, we’ve introduced this as, for the paralegals in the firm, a chance to improve their background, gain some credentials that they didn’t have in the past. For the attorneys, it was a differentiator for them. An attorney with a J.D. [refers to Juris Doctor – a graduate degree in law in certain countries], there’s a lot of those out there. An attorney with a J.D. and a green belt in Six Sigma, there aren’t very many of those.

PEX Network: And Matt, turning back to you then, do you think that process excellence or Six Sigma, something like it, is going to be the way forward for the legal profession?

Matt Hunoval: Yes, but I will qualify that. My particular firm is highly process-driven, high volume. A lot of the files or the matters we work on are very similar. It’s - to simplify things a little bit – basically the same thing over and over and over again. My particular field is, I think, the ripest ground out there to employ this kind of analytic and discipline.

For process improvement – you’ve got to have some kind of process.

At the other end of the scale, certain law firms that do multi-billion dollar mergers and acquisitions, or are involved in bet-the-company securities litigation, highly-customized individual work efforts on every case might not translate quite as well in those kinds of practices.

Certainly within those firms you have accounting departments and ancillary support areas, and I think in fact another firm that’s a bigger firm, Seyfarth Shaw, has engaged their own proprietary efforts in some of their ancillary support services. So, for a firm like mine, it goes to the heart and core of the revenue-generating operational part of the business. For other firms, certainly it could be applied, but maybe not all the way across the board in every area.