Everyone is familiar with the age-old adage that “information is power.” I will tweak that to read, “Information is both power—and profit.”
And that will be the theme of my upcoming session at the Ark library conference on February 21 in New York. My presentation is “Who moved my cheese? How firm libraries create new top-line (and bottom-line) value.”
If you’re attending the conference, I welcome the opportunity to meet you and answer your questions personally. Here’s a synopsis of what I’ll say.
Modern law firms face many challenges
Law firms face numerous challenges to maintain and improve their success:
- Flat demand for services.
- Fierce competition.
- The challenge to recruit “rainmakers” in order to expand client base.
- How to differentiate a firm from its competitors.
- The challenge of maintaining + improving profitability.
The biggest but often overlooked law library challenge is how to contribute to firm profitability and more closely align library operations with the firm’s business strategy and profit generation.
Identify paths to increased profitability for legal libraries
When considering which actions and strategies would provide optimal results in increased profitability for their firm, it’s important that legal libraries consider the factors at play—specifically, measuring both the value and ease with which actions can be taken to increase profitability.
As is the case with virtually every other aspect of both business and personal life, technological advances continue to transform the role played by legal libraries. By actively addressing this reality, law libraries not only ensure their own continued importance, but also play an integral role in helping to ensure the long-term success and viability of the firm.
In fact, there are multiple paths to promoting profitability that are worthy of consideration by legal libraries.
Ranking profit enhancing options — an interactive session
I will run a very interactive session. I’ll offer nine ideas to boost revenue or decrease cost. For each, I and the conference organizers will poll the audience to rank the value and ease of each idea. We’ll try to capture the average score for each factor in real time but in any event publish them after.
The audience may agree or disagree with some of the ideas or the details. That’s fine. The exercise is as much about creating a framework and generating ideas as it is about developing one specific recipe.
The ranking will place the options on this 2×2 grid:
Librarians can try to increase direct revenue by improving cost recovery through actions such as charging clients for direct work. Another option is to make the library client-facing, at least with mid-market clients, and direct bill clients for research services and perhaps even subscription alerts.
Historically, supporting the firm’s business development (BD) efforts was not a priority. In fact, 20 years ago, few firms systematically pursued BD. With a flat market and fierce competition, however, BD reigns supreme. By providing better competitive intelligence, law libraries can play a pivotal role in enhancing ‘pitches’. In addition, law libraries can identify emerging business opportunities based upon trend analysis of research requests, and develop early warning systems to identify competitive threats.
Librarians have multiple options to reduce cost:
- Centralize service in a single location.
- Minimize the library’s physical footprint (if not already completed).
- Create standard intake forms and output templates for more routine, high volume business research requests.
- Monitor utilization to ensure attorneys and staff use resources appropriately.
Another cost reduction method is centralizing business research. In many firms, this can lead to questions about which departments own or should own that function. In my view, librarians can make a strong case that they should.
Managing and negotiating better contracts is, of course, a big job for most librarians already. But have the opportunities to move to “just in time” acquisition over “just in case” acquisition been fully explores?
In my reading, I was struck by a quote from Ariela Tannenbaum, Chief Financial Officer of Wilson Sonsini Goodrich & Rosati. She said that “law firms, whether by sheer inexperience or willful ignorance, often either miss opportunities to make money or fail to take advantage of money already earned.”
Avoiding “missed opportunities” to add to the bottom line may well determine how libraries fare in the future.
View conference agenda and register to attend.
Contact me if you have any questions or comments.