A recent survey on information retention and e-discovery practices, undertaken by a large IT service provider, yielded some surprising results.

The purpose of the survey was to better understand how companies are responding to litigation and regulatory requests for information despite an increasing amount of data from a growing number of sources. The survey also asked whether companies had implemented formal information retention and e-discovery practices, and the impact of doing so.

The survey uncovered the following facts:

  • E-mail is no longer the most commonly requested category of record
  • Instead, both loose files and information from databases outrank e-mail in production requests
  • There has been a rapid rise in demands for access to both social media and mobile phone text messages
  • Data in SharePoint sites is becoming more commonly requested

 Companies are feeling the impact e-discovery requests:

  • On average, respondents said they had to respond to legal, compliance or regulatory requests for electronically stored information 63 times in the past year
  • To find this information, IT staff needed an average of 66 hours.  That’s more than 4,000 hours per year or the equivalent of two person-years

There are wide variations between companies in information retention practices:

  • Nearly half of respondents do not have any formal document retention program
  • Top-tier companies that closely followed best practices were:
    • 81% more likely to have a retention plan in place
    • 63% more likely to implement the automation of legal hold
    • much less likely to follow poor information management practices, such as performing legal holds in their backup systems (vs an archive or offline storage tool)

Companies who responded to the survey reported that in cases where they were either late, partially or completely unsuccessful in responding to an information request, they experienced the following consequences as a result:

  • 42% suffered damage to the enterprise reputation or embarrassment
  • 41% suffered fines
  • 38% suffered a compromised legal position
  • 28% were sanctioned by the court
  • 26% had a reduced ability to make decisions in a timely fashion
  • 25% reported the delay or lack of success raised their profile as a potential litigation target

The recommendations that emerge from this survey reinforce those that are commonly cited as records management and e-discovery best practices:

  1. Create and implement a records management (RM) program. Begin with a formal plan, reviewed by counsel for compliance with applicable legislation, and refine that plan over time to address specific laws and regulations governing the retention and availability of information specific to your organization or industry and new and emerging technologies.  Without a formal records retention plan, employees will not know what they must retain or what, if anything, they can delete.  Failure to delete information which may by law be deleted risks over-retention, and could create additional risk and unnecessary e-discovery expense.
  2. Follow the RM program, including any provisions for deleting electronically stored information (ESI).  Most retention plans will allow companies to delete certain ephemeral and non-business information according to a record retention schedule defined by the RIM program.  If yours is one of the almost 20% of organizations that retains archived data forever, your organization may be at risk for increased storage, litigation exposure and e-discovery costs.
  3. Think about emerging technologies such as social media, cloud data, instant messaging and structured data systems and include these in your RM program. E-discovery does not just involve loose files and e-mails. A data retention policy identifies where all electronically stored information resides company-wide so that ESI sources do not go unrecognized.  New e-discovery tools may be required to defensibly collect and process this ESI for review.
  4. Use automated legal hold processes and solutions. Automated legal hold processes can be effective in communicating the importance of a given legal hold notice, and to track responses and issue reminders to affected custodians.  A manual system for legal holds may break down across many custodians or systems of data.
  5. Perform litigation readiness exercises.  Companies that practice “fire drills” and which test e-discovery and record retention systems are in a much better position to withstand challenges to their internal processes.