How to drive growth with essentially flat demand and hold onto existing markets and clients.
That’s the overarching concern in most medium-large law firms today, which are looking at their entire financial and operational picture to deal with:
- New competitive options for legal services
- AI and other emerging technologies
- Clients expecting and demanding more
These forces are causing managing partners and other firm leaders to explore every possible way to operate, innovate and compete to their advantage. Every internal process and function is being looked at, including research and intelligence. While research was once focused on legal issues and client matters and supported by the firm’s library, today’s firm has more diverse information needs, like market and competitive intelligence, and the firm’s library is mostly digital. These are some of the factors that are leading firms to LAC for guidance on getting the information services they need, in a way that maximizes value and minimizes costs and administrative burdens. It’s where the crucial decision of “building (and maintaining) versus buying” comes in, with multiple considerations that I’ll review here.
Let’s start with money, as it’s one of the primary drivers behind every buy versus build decision. Buying a service like research and intelligence is attractive to many firms. By leveraging the special expertise and infrastructure of the service provider, they gain freedom, flexibility and more consistent, predictable costs while reducing burdens and risks. Even if the cost structure ends up being about the same, these advantages deliver considerable value, especially considering the transition from initial investment to long-term maintenance.
Building infrastructure is undeniably expensive. Recognizing that law firm libraries were becoming more of a service than a place thanks to the shift to digital formats, LAC Group developed the Library as a Service model, which gives firms the comprehensive research and intelligence they need, but on a fractional cost basis.
Change and innovation
Business innovation in general, and legal innovation in particular, is a trending topic. According to Deloitte, a significant share of information technology budgets across all industries are allocated to business innovation and incremental change. I call these two goals the “last mile” of the journey, because technology is only a tool to support change and innovation efforts; the actual work of innovating and changing requires human judgment, creativity and awareness. Going back to financial considerations, it’s common knowledge that innovation can be costly. Also according to Deloitte,
“Because today’s innovation investment can become tomorrow’s operational expense, it’s critical to understand the long-term total cost of ownership of innovation investments.”
Law firms are not always taking a holistic, long-term view of all their research and intelligence costs or viewing them as part of their innovation investment.
Timelines and deadlines
Maintaining a smooth workflow can be challenging. In-house research and intelligence teams are often understaffed to begin with, making vacation time or sick leave an additional burden. As our CEO Rob Corrao likes to say,
“Research requests don’t come in sequentially, in perfect order. It’s either feast or famine.”
Buying instead of building is an effective way to manage the peaks and valleys of demand by delivering additional researchers as needed as well as extended hours of coverage. For example, LAC Group has people coast-to-coast in the lower 48 states and eastern Canada. Our work day can go on from early morning well into the evening for businesses in North America, without overtime.
Specialized skills and experience
Digital transformation is often considered a technical challenge, when it’s actually a human one. According to Gartner, 70% of employees haven’t mastered the proficiencies needed for the jobs of today.
The legal industry is not the only one facing a lack of digital proficiency and shortage of information science skills. The concept of acqui-hiring, which is the practice of acquiring a company to gain its employees, is becoming more common. Recruiting and hiring costs continue to increase and even with adequate budgets, finding the right talent for a given location is difficult. In large cities with the biggest talent pools, competition is greater. Smaller cities and markets have fewer candidates to choose from.
Partnering with a company like LAC Group is one way to gain access to the skills and experience you need, without an acquisition. We have remote workers in multiple time zones and continents and a center of excellence for research and intelligence in New Brunswick, Canada. In addition, we conduct regular outreach through newsletters, social media, industry conferences and our LibGig career site, giving LAC a leg up on finding and recruiting information professionals.
Workflow and allocating the right staff for a given task are important, yet often challenging. Both attorneys and support staff are doing work that is necessary, but ancillary to their specific jobs and expertise—like marketing staff or attorneys doing their own competitive intelligence gathering or other research that can be done better and more cost-effectively by skilled researchers. These added burdens also lead to stress, reduced productivity and lower morale. A managed solution can free employees to focus their efforts on the work they were hired to accomplish.
How a firm utilizes its information assets and resources will help determine its competitive status. Buying instead of building—or only partially building—gives you fast access to the resources you need, when you need them, wasting less time and money on over-provisioning while avoiding the risks of under-provisioning. There is definitely a place for an inside function, but information service providers like LAC Group bring economies of scale and expertise that organizations can exploit to fully utilize our resources on a dedicated yet fractional basis.
You can build your own research and intelligence function, in which case we would say, keep us in your back pocket as an option. You can take a hybrid approach, or you can buy a service that’s essentially ready to go. My view is that we’re agnostic toward the ‘buy versus build’ argument, and that firm leaders need to explore and understand both options to make the right choice for their information needs.