The April 2011 ILTA White Paper publication on Financial Management includes an article from me on “Bringing IT and KM Value to AFAs." I provide a synopsis here on our blog and encourage you to check out the full paper.
After laying foundation as to what an AFA (Alternative Fee Arrangement) is, the white paper explores the AFA process from a high level and then identifies opportunities for IT and KM folks to bring value to the AFA world. The AFA process includes: setting budgets, modeling for profitability, moving an AFA through an approval process, monitoring the work against the AFA and finally, post engagement review and evaluation.
The obvious first opportunity for KM and IT to support AFAs is with budget building tools and knowledge. The article outlines a number of budgeting tools, but also points out you probably already have some basic tools so you can get started now on this effort. Following from budget building, will be budgeting monitoring efforts. Again IT and KM can bring high value to AFAs with systems and a strong knowledge base for monitoring and assessing AFAs throughout the life of an engagement. The final opportunity is that of capturing AFA knowledge. From my experience, a lot of AFA effort right now is guesswork and gambles – which is OK. However, firms will need to learn from their experience (a.k.a. mistakes) and get better at AFAs over time. So knowledge repositories and systems that enable this effort will have great value.
The bottom line for the white paper is that IT and KM can play vital roles in the emerging AFA space. Now is the time to get involved in these efforts and help build the future.