E-discovery: How a Law Firm Slashes Time and Costs

It's no secret that corporations are drowning in data. IDC estimates the volume of computer data worldwide will reach 1.2 million petabytes during 2011. A November, 2010 Gartner study found data growth was one of the top three challenges for data center managers at 47 percent of large enterprises.

That usually prompts worries about the cost of data storage, but the data itself poses dangers that most companies are not managing well, according to Katey Wood, information management and e-discovery analyst at Enterprise Strategy Group.

Despite the additional costs that unstructured data like e-mails, spreadsheets and word processing documents add to compliance processes, most companies do little to hem in sprawling data, Wood says.

The annual cost of litigation (excluding settlements) was more than $1 million for half of U.S. companies in 2010, prompting far more to investigate alternate ways to pay for legal protection, and 40 percent of large companies to plan increases in spending on e-discovery during 2011, according to .

In the "fire drill" most companies go through following a legal request for information, some companies identify all the users with pertinent data and often just copy all the data on laptops, smartphones and other devices -- rather than spend time selecting what they want, Wood says.