Knowledge management in law firms has evolved through three phases  . Phase one focused primarily on the development of taxonomies to systematize attorney work product and related research. The second phase focused on enterprise search to mine the growing volume of information managed by law firms. Legal industry specific search engines such as Recomimind were deployed by many AmLaw 100 law firms during this phase. Phase 3 was driven by changes in the legal market place and growing competition that led to price pressure and increased demands for efficiency from clients. A major focus of law firm KM today is in using historical billing information to generate alternative fee arrangements and more generally in the area of legal project management to more efficiently deliver legal services to clients.
The initial stage of KM was driven primarily by IT, information technology. That first stage has been described using an equestrian metaphor as “by the internet out of intellectual capital”. The concept of intellectual capital provided the justification and the framework, the seed, and the availability of the internet provided the tool. As described above, the consulting community jumped at the new capabilities provided by the Internet, using it first for themselves, realizing that if they shared knowledge across their organization more effectively, then they could avoid reinventing the wheel, underbid their competitors, and make more profit. The first use of the term Knowledge Management in the new context appears to have been at McKinsey. They realized quickly that they had a compelling new product. Ernst and Young organized the first conference on KM in 1992 in Boston (Prusak, 1999). The salient point is that the first stage of KM was about how to deploy that new technology to accomplish more effective use of information and knowledge.