New information services options for law firms

Managing vendors to control maverick spend

January 19, 2017

Home Blog New information services options for law firms

Law firms that find and leverage the best information will always excel, but that requires great deal of time and effort.

The good news is that firms have more research options and vendors to choose from. The bad news is that it’s becoming an increasingly difficult task to manage them all. In addition, the legal industry at-large continues to have widespread disruption and intense competition due to slower growth projections. Vendors, too, are being disturbed by rapid changes in technology, the economy, mergers, partnerships and customer budget constraints.

As my colleague Robyn Rebollo pointed out in her recent report, In the beginning there were two, LexisNexis and Westlaw are still dominant vendors. Yet as the landscape becomes crowded with more niche services and new vendors, their share is down to about 40% of legal information resource budgets.

Meanwhile, the big two, along with other niche players like Mergermarkets Group, Bloomberg and Wolters Kluwer, continue to grow modestly, whether through acquisition or innovation and internal development. With size, power and more to offer, they offer their own competition to Thomson Reuters and LexisNexis.

And greater competition means these companies are finding every possible way to push content into firms.

CCM executives presenting at LegalPros

February 1, 2017
1:30pm – 2:30pm
New York Hilton Midtown

Tools of the Trade: Negotiation Skills

With the aggregate of information-related costs often reaching nearly 5% of a law firm’s total budget, it is imperative that the firm’s key negotiator on legal information issues be the person with the critical knowledge base.

Natalya Berdzeni, Executive Vice President, Chase Cost Management
Robyn Rebollo, Vice President, Chase Cost Management

http://legalweekshow.com/legalpros/

So many vendors and too many interested buyers

Information service providers once focused their law firm selling and marketing efforts on the library director. Today, many are soliciting business to different user groups, partners and executives who are not always aware of the service subscriptions and contracts already in place at the firm.

We see this problem in large firms that have a wide number of practice areas, with each one operating in a silo environment. It’s also prevalent in firms with multiple offices, and global firms with international locations bring a heightened level of issues, depending on how centralized or decentralized a firm chooses to operate.

Yet I see this as the evolution of technology, which is always creating new opportunities for services for specific practice areas or specific functions like marketing. It’s natural for a niche vendor to go directly to people in the firm that will recognize their value and have a need for their offering – especially when these vendors have no pre-existing track record or library relationships to rely on.

The problems with maverick spending on information services

While certain offices or practice areas may have unique research and information needs that must be addressed, it’s not advantageous for law firms to have many different people making independent purchasing decisions, especially on services that overlap and affect so many users within the firm.

Maverick spending on information services:

  • Adds to library budgets, since that is where the funding generally comes from in most firms. This creates an additional burden on a spend category that remains flat.
  • Is not a prudent, strategic use of the firm’s financial resources.
  • Lacks cohesiveness and leads to inefficiency at a time when firms need to be focused on streamlining and eliminating unnecessary waste.

Library directors are focused on content and user satisfaction, which means they may be saying “yes” when the better answer would be “Is this necessary?” or “Let’s explore options.” Also, when library directors offer critical recommendations on eliminating content or not agreeing to new acquisitions, they often find less support from their superiors at the top level if the suggestion is unpopular with some users.

In addition, they have less time and fewer employees to deal with the ongoing administrative tasks of vendor management. For example, information service contracts may not come on the library’s radar screen until renewals, when the decision cycle is short – often 30 days, or even just 15 days. That’s not enough time for adequate assessment and simply leaves no leverage or negotiating power.

As for procurement, even the largest firms still lack purchasing sophistication. They may not have a formal procurement function, and if there is, the procurement staff have limited depth of knowledge on specific spend categories. They lack benchmarking data, product understanding and vendor insights.

The rewards of professional vendor management

Spend management services from a company like ours can pay for itself in savings and other benefits. CCM is unique in that we are armed with library and information resource expertise. Our team includes not only procurement specialists, but former law librarians who identify shortcomings and uncover savings opportunities in electronic research services, fee-based solutions for competitive and business intelligence, and other library software systems. They know when niche services are worth the investment, and when they are not, considering unique firm environments. They are pros at finding duplications, where a firm is paying for redundant content and services, and recommending the best ways to approach it to maintain user satisfaction within the firm.

Perhaps our biggest value comes in being outsiders to the firm’s politics and hierarchy – we can challenge partners and other decision-makers and play the role of the “bad cop” because we can make recommendations without negative consequences. We can be objective in assessing needs and personal preferences. We are strategic about matching needs with options and recommending alternative approaches, and we can offer scenarios that have been tested in similar situations with our other clients.

If your firm is running leaner than ever, consider outside support from experts like CCM. We can level the crowded playing field of information service providers in your favor.

I am happy to answer your questions, or to schedule a complimentary consultation. Meanwhile, I hope to see you at LegalPros on February 1.

Robyn Rebollo

Robyn Rebollo

LAC Group Vice President, Robyn Rebollo, is a research services consultant, strategic procurement adviser and information services professional. Her reputation has been established through many years of experience and numerous contributions to the design, development and implementation of information and knowledge solutions for corporations, law firms and universities.
Robyn Rebollo

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