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Diana Scott on the Future of Managed IT and Managed AI Governance for Lawyers · Legal Late Night

• Jared Correia (00:00): Hello everybody. We've got a show that promises to be at least mildly interesting for your listening and watching enjoyment. I'm your host, Jared Correia. I'm the CEO of Red Cave Law Firm Consulting. For the monologue, I address the various shadings of growth by acquisition for law firms. In the interview, we're talking with Diana Scott, the founder of BlueCastle IT Solutions, about what it's like for law firms to utilize modern IT options in the age of AI. In the counter program, we're bringing back the wheel of justice for Diana. Now then, it's time to talk about the various meanings of growth by acquisition and how they affect your law firm's inevitable expansion. (00:44): Law firms are service businesses, which means in most of them, attorneys are required to do the work and that's leaving aside the question of AI for the time being in part because most firms have not truly adopted artificial intelligence to replace lawyers yet. Some aren't even using it at all. What this all means is that if you want to grow a service business like a law firm, you need to hire someone who's not you because you can't quite clone yourself yet. The good news is that there are lots of ways to associate with other attorneys, some of which could be described as growth by acquisition. If you make traditional hires, salary, and usually benefits paid in return for work performed, lots of times you are the one as a business owner providing the work to be done. You're not really acquiring work in that sense, just the worker. (01:37): However, when you bring on an attorney with a book of business that's existing clients, not the potential for new leads that your new lawyer can port over with them, you just grew your top line revenue by acquisition, the acquisition of a new employee and that attorney's active clients. That's a fundamentally different thing than hiring a lawyer without any client base or even bringing on enough counsel attorney who may be able to do work with you jointly but won't be giving you these cases or those cases which would then belong to your business. At best, those are shared claims. Now, there are other ways you can acquire clients from other lawyers rather than buy yourself. Some more and some less morbid. If you had served as a backup attorney to a lawyer who passed away or became too thick to work, guess what? You've just acquired that caseload. (02:30): That's almost by definition a surprise as to when it happens. Not that it would or could, and that's more difficult to claim for. However, in other cases, a lawyer will want exit a practice simply to escape the administrative burden of running one. Oftentimes this is a solo lawyer or a managing attorney with a limited staff who is near the end of a career. In this case, asuming you can connect with that other lawyer and deduce his or her intentions, there's a practice and a caseload, potentially staff too, that you can acquire for no money, but rather just the taking on of that administrative management burden. If you're looking for extra cases equaling additional revenue, that's the best deal going because you don't have to pay for it. But the most common way to acquire a law practice as well as a representation of the most lucrative revenue model would be to buy the firm. (03:23): After all, if those lawyers who are willing to just give away their firm thought they were valuable, they'd be trying to sell them to you. Even so, law firm purchases are still a pretty good deal since they can be acquired usually for 1X gross annual revenue. Oftentimes that doesn't even require a lump sum purchase, but could be paid out of declining revenue percentages post acquisition, which incentivizes a seller to stay on and convert and maintain clients. These law firm acquisitions also often include decades long lists of client contact information likely never leveraged, which represent an undervalued massive opportunity in their own right. There's a lot to be said for this model of law firm growth by acquisition, but doing it once and successfully can be like a dopamine hit that you want to achieve again and again. Not just for the sake of it though, adding a new firm and its existing and potential revenue is similar to bringing on a new attorney with a book of business and a willingness to reign make. (04:21): It's a reliable profit center that you can use to expand your business. Growth in any service business requires forward movement toward revenue expansion. Acquiring other lawyers with books of business and/or entire separate law firms are tremendous options for expediting the amplification of total firm revenue and ramping profitability. Speaking of ramping profitability, you too will profit from staying tuned as we bring in Diana Scott of BlueCastle IT Solutions. In the next segment, we're all in on law firm IT management, plus the sprinkling of AI. (05:07): Well, I've effectively run out of things to say, which is awkward because this is a podcast. So I'm simply going to mimic the sound of a Fishercat until I think of something more appropriate to do. No, the Fishercat sounds horrifying, so I think we can just move on to our interview while I think of a less drill animal to imitate. Our guest today, Diana Scott, the founder and CEO of Blue Castle IT Solutions. Welcome to the show. You're already laughing at my jokes. We're in a good spot. How are you? Diana Scott (05:37): Off to a good start. Doing good. Doing good. Thanks for having me. Jared Correia (05:40): Are you familiar with the Fishercat? Diana Scott (05:43): A little bit. I mean, is that the one that crys sound like little children? Am I thinking of that one? Yeah. Jared Correia (05:51): Yeah. They're just the fucking worst. Fishercast, Martins. In New England, as you know, we have all manner of virulent weasels. Diana Scott (06:02): Yeah. Jared Correia (06:03): Can I tell you a quick fishercast story before we begin? Yeah. I have plastic trash barrels out in the backyard and we're abutting a forest. I had a fishercat one time that chewed a hole through a little hole in the top of the trash barrel and got its way into the trash, which is crazy to me because the plastic was pretty thick. Fuckers. Diana Scott (06:27): Wow.That's a lot. Yeah. I'm just used to bears tearing through everything. Seems Jared Correia (06:33): More simple. In Connecticut? Diana Scott (06:35): Oh yeah. Oh yeah. Central Connecticut? Kind of where we're at. Yeah. I had a bear knocked down fence. We have a fully fenced backyard and we're talking like that plastic composite solid fence. Mama bear three cubs. Didn't want to walk around the fence, so just knocked three planks out. Walked Jared Correia (06:55): Through our yard, Diana Scott (06:56): Got to the other side of a fence, knocked those three planks down and just kept on our way. We fixed the fence. Three weeks later happened again and my neighbor saw it happen, no question who it was. Jared Correia (07:11): You got a camera set up back there? I feel like you could have your own YouTube. I should. Diana Scott (07:15): I mean, I've got the Ring camera on the front, but I guess I don't really have ... Yeah, I should start to observe that backyard, see if I can capture it. Jared Correia (07:23): Bears of Central Connecticut. Diana Scott (07:26): We got bears. Lots of woods. I mean, it's Woodland. Yeah. Jared Correia (07:30): Here's a perfect segue from that. You own an IT business. Yeah. So what was it that got you into IT in the first ... Let's not talk about starting your business yet, but IT. How'd you get to the point where you had an interest in IT? Diana Scott (07:45): Yeah, didn't have a straightforward path, but was a PC gamer, grew up around computers my whole life. My dad, we never bought a computer. My dad always built computers for us, just had that background, but never considered it as a career path. Never thought of it as something I wanted to do was in school at college, getting my sociology and anthropology degree, totally unrelated to IT. And I started a work study in doing IT for just a work study job. And I was kind of in one of those moments of like, wait a minute, you can get paid to do this. I'm sitting at a computer right now and you're paying me for this. Even like I'd worked retail customer service jobs. Jared Correia (08:33): Ah, God. Diana Scott (08:34): And you're on your feet all day, you're dealing with it. And I was like, wait a minute, this is a job because it doesn't even feel like a job and I'm getting paid better than other, like the kind of part-time jobs I had was younger. So that kind of set me off on a path where I was like ... And I had a bit of a skillset already because again, building my own PCs, things like that, went out, got a certification, pivoted, decided to not become an anthropologist, which was sort of a path that I was going down on and spending a lot of tuition money to go down on and made the change. Yeah. Jared Correia (09:12): I do enjoy a good anthropology topic though. What is the best PC game of all time? Diana Scott (09:20): I've never paid StarCraft, but if I would say like a general consensus, that seems to be one of those ones that everyone claims is the best ever. But for me, ones I've played, RimWorld is pretty cool. Maybe even just going back to Skyrim. I mean, Skyrim has just ... Jared Correia (09:37): You could literally have said anything because I've never played a piece of game in my entire life. But for those who have, now you have some recommendations. But Diana Scott (09:51): Your lawyer's Jared Correia (09:51): Eyes Diana Scott (09:52): Glazing over. Ears are glazing over. Jared Correia (09:55): As you may know, IT is usually the domain of burly white man. So how was it getting in? Was that an intimidating factor or was it just like, I'm going to fucking break the mold Diana Scott (10:09): Here? I mean, honestly, I think the impact was more that it, like I said before, I never considered as a career path. Even Jared Correia (10:17): Though Diana Scott (10:18): I had this loved gaming PCs, grew up around computers always around it, it just wasn't on the menu. That was probably more of the impact was just getting in was just there was no path to get in. Once I started and got into IT, a little intimidation, it's more lonely. I've been the only woman in an IT department or at a IT managed service provider or one of few. So that's- Jared Correia (10:49): I'm not surprised. Diana Scott (10:51): Oh no, very common still to this day. Really common. Jared Correia (10:55): It's like the biggest sausage party in the world. Diana Scott (10:58): Yeah, all that comes with. Yeah. I'll tell you this. One thing that you have to encounter, you will encounter if you're a woman in IT or you're a woman considering going into IT, is that you will get shoved all the time into account manager, customer facing roles, whether you like it or not. So if you go into it and you're like, "I really love the engineering side. I really love the technical stuff. This is what I want to do. " It's you and a group of, let's say 20 other dudes and they're going to sit there and go, "Oh, Sarah, you're so good at talking to the customer. You should talk with the customer." And women are just getting shoved into those roles. And so then even ones that probably want to really dive deep into technical get pushed a little bit into the customer service account manager side. (11:45): It's hard to kind of stay in technical roles, I think Jared Correia (11:49): As a. I feel like a lot of people probably will allow themselves to be pushed out as well. Not that that's fair, but it's good that you stuck around and I'm glad you're encouraging other people to stick around and fight for their representation. That's great. Diana Scott (12:04): Yeah. Jared Correia (12:05): Okay. But at some point you were like, "Fuck this. I'm doing my own thing." And that's rare as well. So okay, what made you make the call to be like, "I got to do my own business. I can't work for people Diana Scott (12:20): Anymore." Yeah, it was a combination of two main things. The first being I'd worked for ... So I owned an IT managed service writer. I'd worked for another similar, same type of company and had really risen in the ranks there, started doing operation level projects. So I'm doing stuff in the business side of that company and seeing just kind of how the sausage gets made, seeing how it all works and seeing a lot of problems, IT, not the best reputation for certain things, customer service aspects of things. People have a lot of experiences, maybe not great ones. So kind of see how I like- Did you unplug Jared Correia (12:58): It and plug it back in? Right? Diana Scott (13:01): Yeah. Or I mean just the root. There was like an SNL sketch about a rude IT guy. It was like, that's how prominent it is that we know that character. But saw an IT company and saw it was not necessarily, I would say an operationally mature IT company, but it was successful in running and working. And I sat there and I went, okay, seeing how this all played out, if I run a not great IT company, like operationally immature, not handling customer service very well, this could still be a successful business venture, let alone if I run a good one, let alone if I actually- Jared Correia (13:39): You're like, I just suck and still be okay. Diana Scott (13:41): I could make a living. And I mean, honestly, it's funny to say it that way, but it's freeing. It's a little bit freeing to go there and be like, look, I could really mess up a lot infrequently and I'll be about industry average. So you know what? I think it's worth a shot. And then that was just happening at the same time. I was entering my 30s. I was out in New York City living in New Jersey, working in New York City, and I'm originally from Connecticut. So it was kind of that like, "Am I going to go home? Am I going to make a move?" And at the time I wasn't married, didn't have a house, didn't have all those things. It was kind of this moment of, if I'm going to do this- Good Jared Correia (14:21): Time to do it. Diana Scott (14:21): This is the time to do this and try to give this really that full 100% hit the ground running effort and two things came together. One gave me the audacity to think I could succeed in it and then the other was just the circumstantial moment of like, well, if I'm going to try something and fail, maybe now is a try to time because I can still pivot. I'm still young enough and there's still enough stuff going on. I can pivot and yeah. Jared Correia (14:53): And here we are. How important do you think it was to work for another company that did the same thing first? Diana Scott (15:02): I mean, I think in a lot of ways, huge, huge advantage for me for sure. I mean, just this perspective on the industry, learning from what I saw others do right, learning also from what I think I saw was maybe not done as well or incorrectly. No judgment, just we're all figuring it out. We're all trying to make the business work. It's also a really tough industry. It's a tough sell to have to take on the responsibility of managing your customers like every potential IT need. It's a really broad scope and so seeing it actually in action I know IT owners, I know IT business owners, they maybe work in an IT department for a huge company or like I was the IT administrator at such and such university and then they go out and they start an IT managed service provider and coming from one single IT department maybe huge in scale, but going from that to you got 50, 100, hundreds of customers, different environments, different needs, different wants. (16:06): I've seen some people that are like, "I'm great at IT. Let me start an IT company." And it's humbling. It can be really humbling. Jared Correia (16:13): Yeah. It's similar to running a law firm. You got to be able to practice law and also run a business. Diana Scott (16:19): Yes. All Jared Correia (16:19): Right, let me ask you this. I talked to a lot of lawyers who lament the demise of the hourly IT person because they're like, "I just need somebody to help me out for maybe an hour a month for $75," which that's still our shit. That's not how this works. But talk to me about MSP, what that model is because that's a trend in the industry. Anybody who's worth their salt as an IT service firm is doing that. So just give me the rundown on how that works. Diana Scott (16:48): Yeah. I mean, we're just in a different era than 10, 15, 20 years ago when IT problems were really hardware. My hard drive died, the computer's crashing, there's these physical, very Jared Correia (17:00): Limited Diana Scott (17:01): And scope issues happening. And then it's like, yeah, pay the guy to come fix the computer. We call them break fix guys, so you wait till it breaks, then you call someone to fix it. It's very like, my toilet broke, so I'll call the plumber to fix it. It's a very Jared Correia (17:16): Slow- Here's Eddie. He's got mustard all over his shirt and he's coming in to work on the server. Yeah. Yeah. Diana Scott (17:21): Yeah. So it's not like that anymore. Yeah. It's not like that anymore because we have way more conversations about security. We have more ongoing preventative maintenance cybersecurity aspect of it. And then even just look at the hardware part, it used to be you had a computer. Now you have a smartphone, you have laptops, you have all of your staff and employee managing these things, you have remote and hybrid workers. So even just the simple like, I have a hardware problem with a device is more complicated than it was 15, 20 years ago. When your employees had one desktop PC that's there at your office, it's just a different world on that front. Then you got to layer in the, hey, it's not just about waiting for something to break and fix it. If you wait for a cybersecurity incident to happen, there's no easy fix on the other side of that. (18:16): You want it to not happen at all. Jared Correia (18:18): Yeah. It's very bad. All right. Hold that thought for a second. Let me ask you this because I do want to get back to that, but let me ask you this. So I think IT services can be really hard to sell because ideally if things are going well, you're like invisible, right? Diana Scott (18:34): Yeah. Jared Correia (18:35): So how do you make what you do meaningful for people when you try to sell the services? Diana Scott (18:42): Oh, you're asking me as if I'm a sales expert. Jared Correia (18:47): Don't have to be a sales expert. Diana Scott (18:49): But no, here's what I- Jared Correia (18:50): Just let me know your approach. Diana Scott (18:52): Yeah, no, no. Here's my thoughts on this. It's a hard sale because it's not even a financial conversation and I use this analogy. I think it's a really good one. Well, you tell me. If I were to go to approach somebody, let's say someone's leasing an office and I say, "Look, you can go and move your office down the street and you'll save 10% on your rent." You're going to get laughed at, "I'm not moving. I'm not moving 10%. 20% off what you're paying for. " You just got to move down the street. That's not worth it. 50%, your rent will be 50% off what you are currently paying for. You just have to pack everything up and move down the street. I still don't even think the majority of business owners would take that deal. They're like, "I'm just not moving." So it's not a money conversation. (19:42): Well, you have to go in and sit there and go say, "Hey, I noticed your roof is leaking. I noticed that the doors on your property are completely unlocked. Doesn't seem like your landlord is spending a lot of time." Those security cameras aren't even plugged in. Did you know that? You start to point these things out and you go, "Aren't you storing expensive equipment? That would be a really big problem if the water got in here and it damaged it. Wouldn't that hurt your business?" And then I've got a place down the street. Guess what? It actually costs 20% more than you're paying on rent, but state-of-art facility, all this stuff taken care of for you, it's perfect. You're not going to have to worry a minute and people will take that opportunity. Now here's the problem because I just use an analogy. Jared Correia (20:25): I like that. Diana Scott (20:26): I just use an analogy that we all can follow, but the problem with it is I can point out to someone say, "Hey, your roof's leaking. See how that's a problem." As an IT person, I have to point out what are effectively invisible problems. Jared Correia (20:38): Right. What is a leaky roof in IT? Yeah. Diana Scott (20:41): Right. I have to go and say, look, all your employees are getting these emails and they might click a link and they might have this thing and that might fall through. It's not as obvious to the business owner as that leaky, that water spot that's growing is going to be for them to understand the impact to their business. So the hardest part of MSP is that you have to be the person who's educating your potential customer while also selling, which doesn't go well when people don't trust salespeople for ... Yeah. And it's tough because- Jared Correia (21:13): Yeah. I thought you put something pretty good together. I was vibing with it. Diana Scott (21:18): All right, cool. Yeah. That's the challenge and we're all trying to figure out how to overcome that Jared Correia (21:23): Challenge. Well, let's try to crystallize some of that. So data security, I think that's one of the big reasons why people get into managed IT. How do you go about setting up a firm for appropriate data security? Because the problem with lawyers is they've got all their data is confidential really, which is not the case with every business. Diana Scott (21:47): Yeah. And I mean, even different types of practice that's going to vary. I mean, if you're a real estate attorney, you're touching every possible potential important piece of information on a person. For sure. You've got it. But yeah, it's a layered approach, always a layered approach. So you've got to have- Jared Correia (22:09): That's how I feel about Nachos. Diana Scott (22:12): Everything would work great if you could just tell your employees to not use email and not use the internet. Then you'd be secure. Oh wait, everyone needs to use those things to do their job. So we have to allow them to do their jobs but also limit the risk of them having access to the entire internet and the entire email coming in from anybody and out to anybody. So yeah, endpoint, network infrastructure protection, backups. So both backup Jared Correia (22:41): Being backing up Diana Scott (22:42): The data, a really thoughtful, thorough approach to that. It's not just like make a copy and store it in the same place so that if I lose the original, I'll lose the backup copy. Thoughtfulness around that. And then the big one that's tough and it's easily the hardest one which we try to implement. It's inexpensive and yet so hard to implement, which is end user education. I like to use, I think in analogies, you're picking up answers. Jared Correia (23:12): I feel like that's the last thing that people want to buy though. That's the biggest problem. Do you Diana Scott (23:18): Agree? They Jared Correia (23:18): Don't Diana Scott (23:18): Buy it. Jared Correia (23:19): Yeah. Diana Scott (23:19): And they don't want to enforce it. Honestly, usually training opportunities are cheaper. They're not that expensive, like the tools that do it, but our hardest thing, we provide it. As part of our service, we're like, "Here's your annual cybersecurity training." Getting our customers to get their team to take the training is one, it's like one hour per year, bare minimum. Let's get you that annual cybersecurity training. Takes a lot of follow up, a lot of work to enforce it. But here's the deal. You can have every piece of security. Imagine you're living in an apartment building and you've got like the double door security, right? Only anybody who's got the key or the scan card can get in. And around that, you've got everything. You've got a security, you've got fences, you've got cameras, you've got a security guard without a gate maybe, but if somebody walks up to your apartment building, they don't have a key, they don't have anything. (24:13): And on of your people who live on the inside of the building, "Oh, I see you got a bunch of groceries right there. Let me hold the door open for you. " Jared Correia (24:24): If it's analogy for phishing. Yeah. Diana Scott (24:26): It doesn't matter. Someone from the inside opened the door to the outside. And so how do you prevent from that from happening? You can't take the key away from the person who lives there. You have to teach them, I don't care that they look hurried and they're trying to get to the door. You don't know that person, don't open the door for them or look carefully, be aware of these things, know that people are trying to get into our building. Know that last month several people tried and attempted to get into our building. That's education for your employees and for your staff. And that's a huge layer. It's a really important layer, but it's one of those, what's your favorite part of nachos? That's Jared Correia (25:08): Your best analogy. Yeah. Yeah. That's like the jalapenos on the nachos. Diana Scott (25:13): There Jared Correia (25:13): You go. Diana Scott (25:13): Those are the jalapenos. Jared Correia (25:15): So let's say there is a data breach. What do you do? Plane to Ecuador? Diana Scott (25:24): Okay. So I'm usually not surprised. When I hear in the news, somebody get hacked, something happened to somebody. That's not surprising to me because those layers of risk at the end of the day, it's evolving thing, people get through. What I am surprised at and disappointed at is when people are like, "And then we had to pay the ransom for the ransomware, or then we lost the data and it's gone." Because that to me becomes, what was your backup situation? Maybe the event happens and (25:53): It's a lot harder to prevent the event happening. I mean, there's the easy stuff, but sometimes stuff happens. But when it happened, why did you lose everything? Wasn't there a backup? Wasn't there a plan around that recovery? So for most of our customers, if there was to be a ransomware or cybersecurity attack, data breach, there should not be a loss of data if the people who know what they're doing have set up that sort of backup. There shouldn't be too much downtime if you've got a plan of like, "Okay, what's our recovery plan if something were to happen?" Now, if client data, sensitive data, personally identifiable information, PII, that gets out. There is the whole component of sharing that news, doing the proper- Jared Correia (26:46): Yeah, reporting Diana Scott (26:48): Statutes and stuff. Reporting. Yeah. And do not play around with that. There is a lot to lose if you're not doing proper reporting of these incidences incidencies. Jared Correia (27:03): Oh, very nice. Diana Scott (27:07): But one thing I was going to say in the mix of that is, okay, so there's ransomware, there's losing the data, there's downtime to your business. So that's operational disruption. And then there's ... Oh yes, of course, cybersecurity. So any of our customers, we don't care who you get the cybersecurity insurance policy from. We are always, always pushing it. We're pushing it on our customers. We're like, "You need this. You just need this. " Because we're doing everything really, truly. Our customers are getting everything we can to secure their environment and still we know there's no 100% guarantee. And if something were to happen, even through all these layers that we're putting into place, the impact to your business both financially and on a reputation level is incredible. I mean, it's just- Jared Correia (27:56): The reputational damage is not great, not a good look. Diana Scott (27:59): Yeah. So one of those things, something like that goes down, you want to have all the protect, get back to layers. You want to have the backup disaster recovery. You want to have cybersecurity insurance. You want to have a plan of who's responsible for in the organization for doing the messaging and reporting all of that. You're going to want that in place ahead of the curve, because after it happens, it can be pretty messy. Jared Correia (28:27): Yeah. The best way to do it is to not have a breach for sure. And that's why you have an MSP. All right, let's change topics a little bit. Are you getting law firms who are like, "How do I set up AI technology in a secure fashion?" And then how do you deal with that? Diana Scott (28:47): Okay. Yes and no. Yes, I'm getting questions about AI. No, no one's asking about the security part. Jared Correia (28:54): Everybody's like, "Just fucking do it. " Diana Scott (28:57): Yeah, I wish. The first part, you started that question, I was like, "Uh-huh." And then you're like, "And how to keep it secure?" And I'm like, "I've Jared Correia (29:03): Never asked Diana Scott (29:04): That question." Jared Correia (29:06): We just bought Claude and gave it access to all our shit. Is that cool? Yeah. Diana Scott (29:10): Yeah. Jared Correia (29:11): So you're coming in at that point? Are people going rogue on you? Diana Scott (29:15): We're actually really trying to be proactive. I mean, we're this month announcing to our existing customers some what we're calling managed AI services, which a lot of MSPs are getting involved with. Oh, Jared Correia (29:27): Cool. Diana Scott (29:28): But one of the ... I can't speak to how the other IT companies are handling it, and it's all very new, but what we're really approaching it is, yeah, let's be thoughtful with the security side of things when it comes to AI. In particular, what was really a moment for us was when customers started putting, yeah, I'm going to get Claude desktop on the computer. I'm like, okay, you want to put this AI agent on your computer where you have everything, everything that you could possibly be important to Jared Correia (29:59): Do. Diana Scott (30:00): And I'm going to put it right here because I once a month want it to take a spreadsheet and combine it with this and make a table for me. You want to give it a hundred percent access to everything to do something that it really only needs access to these three components right here. Let's be thoughtful before people- Jared Correia (30:18): Take all my shit, Claude. Diana Scott (30:21): I saw an example of someone on social media just posted something like, when we first discovered radiation, we thought it was great and tried to put it in everything. We were like, let's put radium in our food. Let's put radium in the walls. And it was like, oh wait, yeah, this is toxic and terrible. And that's a little, I would say AI is a little bit right now. Let's put it everywhere without thinking. Let's put it in the toaster. Let's put it in the- Jared Correia (30:47): Baby can't sleep, cocaine. Diana Scott (30:51): Works great. Jared Correia (30:51): Here we go. Diana Scott (30:52): Fantastic. Jared Correia (30:53): So the managed AI services, how does that work? Is that an ad hoc thing for the particular use case or do you have a product that you can sell at this point? I know all this is moving very fast. Diana Scott (31:06): Yeah. Yeah. And that's what honestly we're trying to keep up. So we do have three basically products offerings. Right now it's only for our existing managed service customers where it goes from there we'll see. But first and foremost, we're looking to protect our existing customer base who are now, (31:23): Yes, absolutely actively engaging with AI and telling us after the fact, or we just happen to see that it's there. Some customers do proactively bring it up. So the first one would be we do have what's called, we're calling our Managed AI Studio and this is kind of a central place where you can have access through the API connections with Cloud, ChatGPT, multiple LLMs, but it has organization oversight. So meaning you can set up users, it's invite only for your staff. They go to a central studio location, studio. Your domainname.com. And then they log in and interact with the LLMs and then you as the owner can see their activity and history and essentially manage. There's actually kind of a next tier up where we can start to lock stuff down. So then because we're their IT provider, we can start to say, look, you can't go to chatgt.com anymore. (32:17): You go to the studio for your company and you interact with ChatGPT, but we'll block your access to the ChatGPT website directly. So it's kind of the next level up of governance. And here's the secret, it's going to cost less. You're going to have access to different LLMs and you're going to be paying per usage on their API, which is cheaper than your Claude for Teams 25 bucks a user. In this model, you'll actually save money. So we're rolling that out. (32:44): We're kind of in a beta right now with some customers and we're looking to be like, have this ready to go for all our customers midstream. That's cool. Yeah. The two other products we've got are very similar so I can kind of sum up with both, but let's not put Claude Desktop on your computer, business owner, law firm, managing partner who has both personal and private professional data all over Yacht Desktop. Let's not put Quest up. Might be too Jared Correia (33:10): Late for some of you all Diana Scott (33:12): Out there. Let's not give it access. It doesn't need to. So yeah, it might be too late. There's a lot of people listening right now. Oh shit. Let's do a hosted cloud desktop. Let's put cloud desktop, cloud desktop in the cloud and then let's feed it access or data that it needs to do what you want it to do. So let's only give it access to that SharePoint folder, that Google Drive folder, that Dropbox folder that you want Jared Correia (33:43): It to Diana Scott (33:43): Have access to. Let's not put it on your desktop PC where you have every single SharePoint folder for the entire organization sitting there and it potentially able to access it. Jared Correia (33:54): Which is similar to how you manage security with people. So they don't need access to more than they need to do their job. Yeah. Diana Scott (34:04): If you hire an admin assistant and you're like, "Here's all of our files for our entire firm." That would be a Jared Correia (34:12): Problem. All our financial files, nobody would do that. Yeah. Diana Scott (34:15): Yeah. No one would do it. Oh, that HR folder? Yeah, here you go. What's your role? What are you doing? And so if you need access to it, of course, if your role doesn't require access to it by default, you don't have access to it. So setting up this kind of managed, let's put Cloud in this place and then let's thoughtfully plan out. Oh, well, I want Cloud to interface with these files. I want them to take a customer fills out a form and then I want to take that data from the form and I want it to do this. Okay, let's give Claude just access to that funnel from that form. So there's kind of a base level simple version and then we can get complicated and we can get more custom from there. And the other thing that's very much like it is managed OpenClaw. (34:54): So OpenClause, sort of like an AI assistant agent, OpenClau, extremely powerful. Also OpenClaw could really, really and has caused major issues and headaches for people because it's not an agent that waits for you to tell it what to do. Jared Correia (35:12): You Diana Scott (35:12): Give it access and it starts to proactively do things on your path. Now that can be extremely helpful, of course. It's basically like an AI assistant that's truly equipped to help you. Yeah, let's not make it wide open. Let's do a managed instance of OpenClaw. And our base thing for that is for now Microsoft 365 customers, I'll give an example. I want OpenCloud to just start proactively helping me with my inbox, my Outlook, everything involved with that. Let's give it read-only permissions right now. Let's give it so OpenClau has like OpenClaw itself, wide open. Your IT company, we're going to go into Microsoft 365 and adjust permissions around read-only access to the mailbox. Also, we have to isolate it because OpenClaw has leakages. I'm almost done with the crazy technical speak, I promise. Here's what you don't want to have. Let me give OpenClaw access to my mailbox and then let me give Openenclaw access to my employees mailbox. (36:05): Oops, OpenClau has access to both. Oops, it starts talking about data that really should only be in one person's mailbox and not my employee's mailbox, my employee shouldn't be able to interact with AI and start talking about emails I'm receiving. Yeah, there's security that needs to go into place to ensure that separation's in place and that's something as the man IT side of things we can help configure. But yeah, that's Jared Correia (36:29): What we have. I didn't think that was highly technical at all. I thought that was really accessible. This is like the story of AI though, right? Anthropic's like, "Hey, we got this new tool called Mythos. It's like really kick ass, but then it can also destroy the world. So what do we fucking do? " All right, last question for you. Let's wind it back a little bit before we move to our next segment. I get questions like this from attorneys all the time. There's still use cases for traditional desktop software. And then what happens if I get something that breaks and I need someone? Do MSPs provide that as service? So for my old school law firms out there, go ahead. Diana Scott (37:12): Okay. So the first question was, do I still need that desktop software? Are we talking firms that have their case management still on the server, not in the cloud? Is that kind of what we're Jared Correia (37:21): Talking about? Should I be using fucking Needles case management software on my desktop? Or I use Outlook, but I only use Outlook and it's on my computer, not in the cloud, that kind of thing. I literally have people asking me about that today. Diana Scott (37:38): I think that unfortunately we don't have as much control around this because every company and their mother is moving us to that cloud SaaS software as a service model. In QuickBooks, Stalwart, everyone on QuickBooks and they're like, "Yeah, you can't just buy our QuickBooks anymore and own it for life. You have to do a recurring monthly or annual subscription model." So everything is just pushing you that way, whether it's the best thing or not or the advantages almost kind of moot point because it's not even an option on the table anymore. You are just getting pushed towards the cloud hosted and it's more about how do we navigate the space now that we're here because I don't foresee or predict a major shift in the opposite direction. Unless some company could really benefit from being the company that sells that model because they stand out from the rest of the world until that happens or something like that, I just don't see us. (38:42): Anything that's really- Jared Correia (38:43): It's more of a cultural shift. I think that's right. Diana Scott (38:45): Yeah. Anything that right now is perpetual software and a desktop 10 years from now, I really don't know how much of that still exists. They're going away or they're dropping Jared Correia (38:55): Off Diana Scott (38:55): Those companies. Jared Correia (38:56): In-person help, what if you're working with somebody and they're in Arizona and they need somebody to come and fix their stuff, what happens? Diana Scott (39:04): You mean how my company handles it or just generally that concept? Jared Correia (39:10): Either. Dealer's choice. Diana Scott (39:13): The thing about today, most IT type work ... I've got customers down the street, let me put it this way. We're in a post COVID era too. So everyone's cool, Zoom, remote, we're very much used to it. I have customers down the street that it's still faster for my team to just remote in right here and fix it. Even just the 10 minute drive down the street is like wasted time for you and me. Yeah, fair point. So most situations we have the remote setup. The truth is that physically speaking, what's limited now to physical support, no one's coming to your office to change out a hard drive anymore. Most of the devices you or buy, you can't even change the hard drive. You can't change the RAM. It's locked in. Apple products, forget it. There's no hardware to be dealt with. So now it's like I need someone who can use their finger to push the power button on and off and I need someone who can really plug in an ethernet cable on occasion. (40:12): Not even that common as common anymore because of wifi. So unless we're talking about servers hosted locally, like still an environment where you have your servers on premises, if we're just talking about workstations, printers, yeah, I mean that's generally worked out and worked with staff that are there who can power stuff on, plug stuff into power or not. And worst case scenario, like in our situation, BlueCastle IT, we have law firms throughout this country. Generally speaking, if they actually have an office, they're not fully remote themselves or they're hybrid or something like that. Worst case scenario, we have a network of sort of hands on deck that we can send out in those cases. Eight years of owning my own IT company before that, five, six years at a MSP, that's not counting help desk time before that. Actually, I don't know if we've had to dispatch anybody onsite physically outside of our onsite range. (41:20): I'm Jared Correia (41:20): Racking my Diana Scott (41:20): Brain. I can't think of it. Jared Correia (41:22): Excellent stuff here, really. Now we're going to unplug and plug back in with our next segment. Will you join us back here in a moment? Diana Scott (41:32): Yeah, let's do it. Jared Correia (41:34): All right. We'll be right back, everybody. Welcome back everybody. That's right. It's the counter program. It's a podcast within a podcast. This is a conversational space where you can address usually unrelated topics that I want to explore at a greater depth with my guests. Expect no rhyme and very little reason. Diana, welcome back. How are you? Diana Scott (41:57): Doing very good. Jared Correia (41:59): Well, as you can see, we brought back the wheel of justice for you. This is based on the wheel of drinks at Backowski Tavern in Boston, where you spin the wheel and you got to buy whatever drink the wheel dictates because the wheel is wise and the wheel is just ... So we'll spin the wheel in whatever category comes up. I'll ask you the question associated with it. We'll do six of these. We'll spin the wheel and we'll see what comes up first. So Evan, please spin the wheel. Let's see what we come up with. Monkeying around. Monkeying around. Okay. Half of these topics are legal specific, business specific topics. Half of these are totally generic, like wild stuff. Okay. So monkeying around, what is your favorite prehistoric animal and why? Diana Scott (42:45): I've done a lot of thinking on this subject. No, just kidding. I don't know. Probably the terradactyl maybe. I think it's Jared Correia (42:56): Really cool. That Diana Scott (42:57): Counts? Yeah. I don't know. I think it's really cool that today's birds are dinosaurs that have just sort of ... Jared Correia (43:04): Oh, you've seen durasic park. Diana Scott (43:06): Yeah. The direct continuity of the little bird out my window to a dinosaur millions of years ago, not just millions of years ago. I think that's cool. So I guess I go with a terradatal, something bird-like. Jared Correia (43:18): A little bit different though to have a cardinal on your windowsill versus the fucking terradacal. Diana Scott (43:23): Yeah. Jared Correia (43:24): Or Diana Scott (43:24): Peridactile. Yeah. Yeah. A little different. I like this version. I like what the dinosaurs have really come up with these days. Jared Correia (43:32): Yes, these are better. I don't know. I spend a lot of my time watching YouTube videos about prehistoric animals. Oh, Diana Scott (43:39): Cool. Jared Correia (43:39): Randomly, my kids woke up at 5:00 AM the other day and we watched PBS documentaries about prehistoric animals for two hours and my wife came down and she was like, "What the fuck is going on here?" Which is a fair question to ask. So I have many choices for ... I don't know if I could pick a favorite prehistoric animal because there's so many. All right. Let's spin it again. What'll we get for our second question on the wheel of justice? The wheel decides. Okay. We got back that Cash Up. We love puns here at legal late night. Back to that cash up would be a business related question. Diana, what is the best backup protocol for a law firm? You referenced this before. You got a ransomware attack. You want to be able to back your shit up so you can recover it. What's the way to do that? Diana Scott (44:38): Yeah. Well, so if you have anything like a server, you have your case management data locally hosted. You're going to want local copy of that data. You're going to want a second copy also locally ideally. And then you're going to cloud hosted copy of that data. In the industry, we call it the three, two, one rule, or you have the original local copy, cloud backup generally is how you can think of it. And you want to sprinkle in something called immutability. So for example, our customers, we provide cloud backups for 30 days. Once it hits the cloud, no one can delete it, modify it, alter it. We can't modify or delete it. You can't modify or delete it. The provider who provides that immutability style backup, they can't destroy it, which also means you're paying for it for 30 days. So you can't be like, "Oops, I don't want to pay for this anymore." Too bad you are, because no one can delete it for 30 days. (45:33): But that's the way to do it if somebody, because even if somebody on the inside is like, "I'm going to delete all the data here." They can't even attack that immutable copy for that length of time that you set. And if you're using a third party apps, if you're using Microsoft, Google, back that up, back that up as well. There's so many third party backup products that you have for your Microsoft 365 and Google Workspace, both your mail emails and your, what do you call it? Cloud storage, your file storage, Google Drive or SharePoint and what have you. Back it up because you delete something maybe in purpose, but later you think, "Oh no, I needed that thing. I needed that mailbox from that employee who worked here six months ago." After you delete it and after that grace period with Microsoft Microsoft or Google, it's gone. (46:26): They're like, "That's not our problem." So having your own third party backup of that data is the other huge, huge thing you're going to want to have. Jared Correia (46:33): Excellent. Let's spin the wheel again and see if we can do something more fucked up. Diana Scott (46:39): That seemed like a plant. I think there's going to be comments that will be like, oh, Jared Correia (46:42): There is some place here. About backups.You didn't tell me to ask you about backups though. Diana Scott (46:47): Yeah. Jared Correia (46:48): I just want to be clear. Okay. Our next topic. Diana Scott (46:52): Vehicular. Jared Correia (46:53): Vehicular nomenclature. What was your favorite car that you've ever owned? Diana Scott (47:00): Oh, I mean, I'm lame with cars. I'm not going to lie. You don't have a favorite. I love my little Civic Hatchback. 2018 Civic Hatchback. I love that thing. Jared Correia (47:11): 2018 Civic Hack. What color? I still have it. Diana Scott (47:14): I still have it. It's not my main car anymore, but it's now. But when I got that, there's that whole kind of Honda Civic loving subculture. Jared Correia (47:27): There is. I used to have a Civic myself back in the day. Diana Scott (47:31): Yeah. And Honda knows it. And so they're making some design choices and they're making some ... I think it looked cool. I had it when I lived in New York and New Jersey and having a hatchback in New York City is like having a pickup truck anywhere else, meaning I moved so many friends. It's incredible how many people I helped move in my 20s with my hatchback. Jared Correia (47:59): 2018 Honda Civic hatchback. Did you give me a color? My car before that. What was the color? Diana Scott (48:05): Black. Jared Correia (48:06): Oh, okay. My favorite car that I ever owned, no one asked me this, but I'm going to say it anyway. 1980 Mazda 626 that I could not get it to accelerate. The gas didn't do anything. So what we did was we kicked the idol up to 25. So I would take my foot off the brake and this thing was fucking flying. It just cut a cruise. Yeah. But then it would only hit a tos speed at 25 miles an hour. Diana Scott (48:32): Unless you caught a hill Jared Correia (48:34): And then you- Unless I caught hill at the 90 style, right? All right. Let's do the next one. That was a fun one. Question four. Will it be a business question? Will it be some complete bullshit? And it is ... Electric slide. I was hoping it was the other one. Okay. Electric slide. The tube one is good too. Electric slide. What is your favorite electronic device that you've ever owned? Blackberry Flip phone, smartphone, whatever. Give it to me. And we get two more after this. Diana Scott (49:07): That is the hardest question for an IT person. Jared Correia (49:11): I know. I thought you might have a good answer. Diana Scott (49:17): What's the coolest or what was it? What was the best? Jared Correia (49:21): You could do coolest. This is the electronic device version of your 2018 Honda Civic hatchback. Diana Scott (49:31): I'll say at the time this was really cool, which was I had a Sony laptop and it was in my college era. And Sony owns the Blu-ray discs. Jared Correia (49:43): So Diana Scott (49:43): This is like late aughts. And I had a laptop, Sony laptop that had a Blu-Ray drive in it. So I could play Blu-Ray movies in my laptop. Now at this time it had an HDMI port. So I'm walking around with basically a Blu-ray disc player that's portable and also a laptop. And at the time I thought that was pretty damn cool. That's pretty bad. Because everyone else was with their lame Dell and HPs. They didn't have Blu-ray disc players. I could hook that up to a TV or watching a Blu-ray. Jared Correia (50:17): That's a great choice. Dell fucking sucks. All right. Spin the Wheel Evan. I hate Dell. I have a rational hatred of Dell. Yeah. Let's see what comes up as I try to get a suit. Oh, could it be? Oh. Yes. I was hoping this would come up totally tubular. What's the best toothpaste? Diana Scott (50:41): Oh, I'm so basic. I just use Colgate, whatever. Jared Correia (50:45): Not even like the type of brand of Colgate? Colgate Supertooth? Diana Scott (50:51): I'm on the fence for this one, but I do have these ones that are called Bite. I think they're just called Bites or whatever, but they're little almost like Tic-Tacks, but you're supposed to bite into them and then you like wet toothbrush and it's supposed to replace toothpaste. Yeah. And it's supposed to be one of those things where it's really just good for the environment. It's not like the plastic tubing. They come in a little glass little jar and you can get refills. My only problem is that it's not pasty. It's like crunchy. Biting a Tic Tac and then brushing your teeth with it is how it feels, even though the contents are supposed to be really good. So I have that and I've been trying it. I don't know if I'm sold on it, but it's cool. It is pretty cool that toothpaste comes in these little Jared Correia (51:35): Bites. I didn't even know that was a thing. It kind of sounds like adjusting to paper straws, which I struggle Diana Scott (51:42): With Jared Correia (51:42): On a daily Diana Scott (51:42): Basis. Yeah. All right, Jared Correia (51:45): Good answer. We got one more question. Let's see what comes up. Let's spin the wheel one final time. Danny, you were not prepared for this, but you've been pretty good. And I'm glad we've got a random set of questions coming up. Let's see what comes up next. And it is Brass Bonanza. Diana Scott (52:00): Bonanza. Okay. Jared Correia (52:01): Do you know what Brass Bonanza is before we get started? Diana Scott (52:04): No. Jared Correia (52:05): Okay. As a Connecticut person, I feel like you should know this. Brass Bonanza was the theme song of the Hartford Whalers before they moved to Carolina. Diana Scott (52:17): Oh, no kidding. I did not know that. Granted- Check it out. I was young when they left. I try to pry like anyone. I'm like, "Bring back the whalers." As if I had ever gone to a game when I was a girl in the '90s. Oh, I never went to Jared Correia (52:31): A whalers game either. But brass bananas- But Bresband's the jam. Okay. So what is your favorite Connecticut sports team right now? Diana Scott (52:42): Oh, I mean, come on. I mean, Yukon, Husky. I mean, the basketball ... The harder question is women or men. That's a hard question. But I'd probably say women, women's basketball team. Yeah. I mean, it doesn't get better. Jared Correia (52:55): They do. Diana Scott (52:56): Yeah. The easiest question. Jared Correia (53:01): The less that about Yukon for me, the better. I'm a Duke fan. All right, let's wrap this shit up. Diana, thanks for coming on. Get out. You were great. Come back again sometime. Diana Scott (53:13): No, thanks for having me. This was a lot of fun. Thanks, Jared. This was great. Jared Correia (53:16): All right. We'll talk soon. Thanks for our guest today, Diane Scott, who's the founder and CEO of Blue Castle IT Solutions. To learn more about Diana and BlueCastle, visit BlueCastleit.com. That's B-L-U-BlueCastle, C-A-S-T-L-E, IT.com, BlueCastleit.com. Now, because I'll always be a 90s kid who enjoyed a 3D Dorito from time to time, but whose true passion is burning CDs for anyone who would listen. I'm not just doing the monitored version of that, which is creating Spotify playlist for every podcast episode that I record, where the songs are tangentially related to an episode topic. For this week's playlist and in honor of Diana's appearance today, I put together a list of songs about castles and it's all brought to you by White Castle, those delicious sliders. Though I won't limit my playlist to just blue or white castles, I've not actually secured a sponsorship from White Castle, sadly, but if those delicious bastards would like to come my way, they know where to find me. (54:22): Join us next time when I buy new pajama pants while recording the show.