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The True Cost of Document Errors

Wed 29 Sep 2021

Errors, even small or seemingly trivial ones, bear a high cost, both in terms of financial losses and reputational damage'and nowhere more so than in legal writing.

The Financial Cost of Document Errors

Document errors that directly cause financial losses are fairly rare, but when they happen, we're all glad they didn't happen to us. Like the time Macy's sent out a catalog with a typo, offering a $1,500 necklace not for the intended price of $479, but for a mere $47.The most expensive example was a missing hyphen in the code directing NASA's unmanned Mariner 1 space probe. Rather than flying to Venus to collect data, the Mariner 1 exploded within five minutes of its launch. The cost? $18.5 million in 1962, worth about $150 million in 2019.Sometimes, it's not even a typo but simply a poorly punctuated sentence that causes strife. Recently, the lack of a comma in a state law compelled a Maine dairy company to settle an overtime dispute with its workers'to the tune of $5 million. (Not everyone loses money from these mistakes: Google reportedly earns $497 million per year from ads on commonly mistyped URLs.)But these losses, as expensive as they can be, are only the most visible damage, not the most important or lasting. It's far easier to earn back lost money than it is to win over a reader's confidence or trust, once it's been damaged.

The Reputation Cost of Document Errors

As Warren Buffett put it, 'It takes 20 years to build a reputation and five minutes to ruin it.' There are two key aspects to a writer's reputation that are decimated by sloppy errors: confidence that the author has the requisite skill to write a document and trust that the author put in the effort to do good work.First, whether you're reading a novel for enjoyment or signing a contract for a multimillion-dollar deal, you want to be confident that the author of whatever you're reading did at least a competent job. Sure, this is less important with a novel, but even then, who wants to waste precious recreation time on a book that ultimately disappoints? In a similar vein, finding an error in a contract might entirely change the interpretation of that contract'and it will certainly change your opinion regarding the skill level of the lawyer who drafted it.Worse, even, than losing money or confidence, mistakes can lead readers to lose trust that the author of a document cares enough to get it right. Yes, some argue that typos and spelling mistakes don't matter, while others joke that no one trusts lawyers anyway. If that's the case, why would errors cause a loss of trust, and why would that matter?People may not trust lawyers as a class, but they absolutely trust'and absolutely must trust'their own lawyer or law firm. Without trust in an individual lawyer's investment in a case, clients simply won't be forthcoming about difficult facts, which launches a self-fulfilling problem: a law firm can't competently represent a client if that client doesn't disclose critical facts. In short, when clients lose trust in their lawyers, those lawyers are dead in the water.

The Solution: A Comprehensive Document Drafting Lifecycle

This is why, at Litera Microsystems, we're evangelists for understanding the document drafting lifecycle. We've considered the entire lifecycle of legal documents, from their initial creation through a rigorous process of checking and proofreading into an end-stage of collaborating and sharing those documents safely and securely. With that in mind, we've leveraged smart technology to help lawyers at every stage, automatically detecting and flagging errors in terminology, consistency, usage, and cross-referencing.The result? We can help eliminate these small but costly document errors'and eliminate the financial and reputational risks they bring. Ready to learn more? Please contact us to hear how the document drafting lifecycle can work for you.


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