Image [cc] spanaut

While attending the AALL Futures Summit last week, I got to talk with a number of young members (those within the first five years of the law library profession) and found the discussion to be absolutely wonderful and enlightening. I have a number of topics that I’ll probably blog upon over the next few days, but the first one I wanted to cover was the dichotomy in the social personalities of those younger members who have hundreds of online friends, but find it very difficult to interact in social settings at the annual conventions. One friend said it more frankly, and describe it as a schizophrenic-like situation when it came to social interaction. Perhaps, on the surface, it looks like there is a conflict with the idea that someone can have hundreds of Facebook friends, and not be able to connect with real people (even those that are in that Facebook friends list), but I think that there is a solid reason for this dichotomy, and potentially a way to work out a solution to help bridge this gap.

Right now, the common “social setting” at an AALL conference (and I’d go out on a limb and say this is probably common at most other conferences as well) is that of the Member Reception. It can be an opening reception, or a member luncheon, or even a happy hour for smaller groups during the conference. When you think about it, receptions are really old-school social settings. These are the social settings that represent how we have networked for the past 50 years or so… maybe longer. The idea is to put similar people in a room, pump in a little music over the speaker system (live band if times are good), provide a few snacks, add a little alcohol (a lot of alcohol if times are bad), and voilà… instant networking. The whole thing’s a bit unstructured, but has been the traditional method of networking and has worked fairly well. However, I don’t think that this is working all that well with the newer members, and I think I know why.

I had a number of newer members tell me that they were uncomfortable in large social setting, that they hated the reception environment at conferences, and that in all honesty, they were introverts and struggle with how to work a social setting. Many of us agreed that, while it may be an overly stated stereotype of librarians, we do tend to attract introverts to the library profession (obviously, not all are, but many in the room admitted that they fit that introvert category.) However, most of same people that admitted they were introverts were very comfortable on Twitter, Facebook, Quora, LinkedIn, etc. In fact, right after the conference, many of the newer members that I talked to quickly friended me on Facebook. So why the dichotomy? Yes, shyness plays a part in this, but how can we create a better environment for networking? I think the solution is setting up social gatherings that have structure, rules, and guidelines.

What was interesting, was the common suggestion that was made to fix the social networking challenge for newer members was to set up an environment that mimicked Speed-Dating settings. Yes, this got a chuckle at first… and made many of the married members of the crowd whisper, “I don’t think my husband/wife/partner would approve of me going to a speed-dating session.” However, as the idea started making the rounds around the room, it started getting more and more traction, and I started understanding why this type of setting would appeal to new members. I think the primary reason that this type of session would work is because it has structure, and newer members don’t have to wonder “What am I supposed to do in here? What do I do next? How do I follow up from here?”

The Speed-Dating (you know what… let’s change dating to networking for the rest of this post) Networking structure helps the network-challenged members in the following ways:

  • There are rules to follow 
  • It is easy (show up, follow instructions)
  • It can be effective (meet far more people in the time that you would in a reception environment)
  • If you like someone then you have a reason to get back in touch with them (“Friend” them)
  • If you don’t like someone, then at least you only have to spend a couple of minutes with them (“un-Friend them)
In a way, it is like taking the structure of online social interaction and transferring it to a real-life setting. 
Even the older members would benefit from something like this. Many of us have a core set of friends that we hang out with at meetings. This isn’t necessarily a bad thing, but after a few years of keeping your social circles stagnant, it can get a bit stale… or can be seen by others as being a bit cliquish. Therefore, the Speed-Networking reception can help expand even the most seasoned member’s social circles in an easy and fun way. 
I’m not sure if we can have a Speed-Networking session set up as a stand-alone session at next year’s AALL meeting in Boston, but we did have a great idea for how an informal one could be set up. One of the newer members suggested that an area in the back of the room be roped off with chairs set up for a speed-networking session for those that wanted to participate. We’ll have to see if the idea gets off the ground, but I think it would be a great way to help newer members network in a way that better fits how they currently interact, and provides the structure they need to network a room.
Image [cc] James UK

One of the questions that you may hear at a conference is “What would you do if you could start your department from scratch?” Well, this week’s Elephant Post question simply asks that same question. If you could re-brand your department or profession, what would you call it? Would it help remove the stereotypes that are associated with your existing profession? Would you even change the name at all??

Last week, this question came up at the ARK Group KM conference in New York. Although this time it focused on the issue of “Should we even call it KM??” However, many professions ask this same question of themselves. In fact, Librarians even went as far as actually adopting (or attempting to adopt) new names for themselves such as “Information Professional” or calling the Library the “Information Research Center.”

We have a few responses, but I think the question may have been a little tricky for many folks to wrap their heads around. That’s okay… maybe once you see the answers below (especially the AWESOME one that turns the Library and KM departments into a “KILLER Group” you’ll think of a few things to place in the comments section.

Next week we ask what “New” things are you looking to bring in next year. It’s budget season for many of us, so let us know what you’ve fought to bring in for the 2012 fiscal year (even if it’s on your “wish list” at this point.)

Steven B. Levy
Author, Speaker, Trainer, Consultant
Matter Management

Legal Project Management still has a limited connotation. Too many folks still confuse it with project administration, or think it’s a high-process endeavor, or don’t realize that it includes virtually all of the non-substantive work a lawyer and legal team do, including people management, communication, profitability, and, yes, project management.  It is the management of the entire matter.   Trouble is, of course, that ‘matter management’ is already taken! Somehow, MTWE, ‘managing the whole enchilada,’ doesn’t have the right ring to it either.

Greg Lambert
Library/Records Guy
Knowledge, Information, Law Library, and Enterprise Resources Group

I would call it KILLER Group for short! (just because I love that acronym!)  I’m actually still a little disappointed that many of the KM projects that started in Library Services got spun off and into their own departments. I thought that it would have been a lot smarter to keep those two important information resources (internal knowledge and external information) together.   The two groups (separately) think too narrowly on the overall mission they provide to their firms. This is definitely something that I believe where the sum of the two individual parts is greater that their individual pieces. Information wants to be shared… knowledge wants to be built upon… new pieces of data wants to be found and placed in its most effective place.  Would this be a KILLER Group?? hmmm???

Toby Brown
AFA
Strategy and Innovation

Although AFAs and pricing are cutting edge concepts, what I do is really focused on strategies for growing the business and as a corollary, the systems and processes need to get there.  Absent a defined strategy for a firm, most efforts are shots in the dark at moving targets.   The real challenge would be getting a firm to see the light of this idea.

Scott Preston
Information Technology
Knowledge Infrastructure Systems Support

The label Information Technology (IT), like Knowledge Management and Library Services, says nothing about what IT really does. IT is traditionally an infrastructure support department. IT has the responsibility to understand business needs and to provide infrastructure support (systems that facilitate meeting business needs).

I believe Knowledge Infrastructure Systems Support (KISS) better describes what IT does and does a better job of communicating what is to be expected from this group. Best of all, the KISS acronym should remind technologists of their first rule of operation – Keep It Simple Stupid.

Next Elephant Post:

What are the “New” Things In Your Budget This Year?? 

For most of us, it is Budget Season!! That means we’ve all pulled out our pens, pencils, spreadsheets, and calculators to determine what we’re keeping and what we’re ditching. It is also that sweet time of year when we get to put new things in our budget (usually after cutting something of equal or greater value.) After three years of cut, cut, cut, there is talk that some people are actually looking to add in new things for 2012. So, we thought we’d be nosey and see what kinds of new items are on the agenda for 2012. Are there any new and cool products you’re looking at (even if it is on your “wish list” at this point)??

Image [cc] TopatoCo

I’m all packed up and ready to fly off to Chicago tonight to attend the American Association of Law Libraries (AALL) Future Summit. Actually, everyone can be involved in the keynote by watching the live stream of Andy Hines keynote address (1 PM CDT on 11/3), and by submitting comments and questions via Twitter by using the hashtag #AALLFS.

The emails flying back and forth on the AALL member communities over the past couple of weeks have been great, and I look forward to the discussion… maybe even a few arguments along the way.

Here are some of the questions that we will cover at the AALL Futures Summit (with a few links to the Google Docs form if you want to contribute your answers):

There has already been some great discussion on these topics via the AALL Communities page, and I think there will be a lot more to cover in Chicago.
Librarians can be some of the most passionate people you’ll ever meet… especially if the topic revolves around how all of us (and our professional organizations) can better serve our constituents. I once sat across the table from Ron Friedmann during a heated Library Association discussion, and finally Ron chimed in that he has never seen such a passionate discussion about a professional association. I should have warned Ron that when it comes to these sorts of issues… it is never boring!

I really hope that the same level of passion shows up again this week during the AALL Futures Summit… I’m thinking I won’t be disappointed! 

I hope to see you there. If not, don’t forget to tune in the live streaming of the keynote at 1:00 PM Central on November 3rd.

Last week I had the fortune of attending two valuable conferences – the Ark-Group KM and the COLPM Futures Conferences. Perhaps the greatest value to me was the back-to-back participation I enjoyed. This merging of ideas and forums lead me to a new epiphany – or more accurately, an expanded epiphany.
At the Ark-Group KM conference, I was co-presenting with my good friend Kingsley Martin. In our presentation he made this point: Law firms focus on high-end documents for analysis. Clients focus on high-volume documents. His point was that clients were finding value not in gaining efficiencies in Bet-the-Farm work, but instead in bread-and-butter (a.k.a. Law Factory) efforts.
At the COLPM conference there were two things I observed, that combined, make that same point from a different perspective. One was comments from a general counsel (GC) about how BigLaw is not listening. The other was a discussion on how big is the middle segment of the legal market. The GC is bringing the bread-and-butter work in-house (by adding staff) since his outside firms were not addressing that need. The discussion on how big is the middle segment was curious, since people seemed uneasy about actually naming the size of the elephant in that room.
Here comes my epiphany …
The overall size of the market is not growing, or growing very modestly. One stat on this came from another Ark-Group KM presentation. But here is the interesting part – when it comes to the shape of the market, clients have recognized that significant amounts of their work are actually bread-and-butter, in the middle matters. This means the middle of the market is likely growing at the expense of shrinking in the bet-the-farm segment. Or in other words – the overall size of the market is stable, but the shape of it is shifting.
When Ron Friedmann and I posted our Bet-the-Farm versus Law Factory posts a while back, I made the Law Factory argument on the logic that there are too many firms chasing the Bet-the-Farm market segment, making it overly competitive and expensive to chase. This new layer of thinking extends my Law Factory point-of-view, since it argues that bet-the-farm work is shrinking while law factory work is expanding.
For me, this new epiphany further bolsters the Law Factory argument. I understand my thinking is more intuitive than data driven at this point. However, the market continues to highlight clients’ pain which appears to be much more focused on the Factory than on the Farm.
Thoughts on my epiphany?

At the ARK KM Conference last week, there was a statement made that caused a few feathers to be ruffled in the audience… and, surprisingly, I wasn’t the one that said it. One of the presenters mentioned that he sat in on client pitches in order to show the importance that Knowledge Management plays in the effectiveness of the law firm’s representation of the client. Although I don’t remember the exact quote, this was followed up with a statement that roughly said: “In order to have a successful KM program, you have to be in these client pitches.” During the rest of the program, I had a number of audience members come up to me and mention that this statement was simply not true and that KM can have a presence in these meetings, but that doesn’t mean they have to physically be there to have an influence on the client’s decision.

Most of the people I talked to said that they would be willing to pitch to the clients about the value of KM, but that they focus on making the Partners aware of the value of KM, as well as working with Marketing to make sure the materials that the clients see explain the processes that the firm focuses on, and how the processes are streamlined through the overall Knowledge Management program. In other words, KM has a presence in the pitch, but doesn’t need to give a five-minute dog-and-pony show to the client on all the whiz-bang processes that KM supports to provide better, more effective, services to the client.

[Sidebar: Now, I’ll let you in on a secret… sometimes – especially at these types of specialty conferences – people can over-hype how important they are back at their firms. Sometimes, some of those great looking interfaces that they show you on PowerPoint slides… they don’t really work as well as the presenter says they do. Sometimes, a presenter may say they always have “A Seat At The Table” when they really only walked by the table once and gave a quick presentation (all while standing beside the table, because all the chairs were occupied.) So, be careful on taking some of these stories at face value. A serious “red-flag” is when someone talks up something, then finishes up with the old standby of “I’d love to say (or show you) more, but this is proprietary and my firm won’t let me.” Remember, if it sounds too good to be true… it usually is.]

All of this isn’t to say that there isn’t times when having KM at the client pitch wouldn’t be useful. In fact, there was one scenario that one of the speakers brought up that would make perfect sense for KM to show up at the initial client pitch, and that is when you are pitching to General Counsel that is an alumni of your firm. The GC is probably remembering how inefficient he or she was when they worked at your firm, and assumes that you are still as bad at it as you used to be. If you’ve improved the processes and procedures of legal work at your firm through KM projects, then this is the time to bring those out into the light.

It’s important for KM to have a presence when pitching the overall services to a new or existing client. However, it doesn’t seem that in order for a firm to have a “successful” KM group, that they need to physically be present at the client pitch unless doing so solves a specific question the client may have. Quite frankly, this rule fits most of the cogs of the great law firm machine. Each of our individual pieces should remind those needing to be in attendance on the client pitch of the value that we bring in representing the client in an efficient and effective manner. It really is a matter of having a presence in the overall abilities of the firm to represent the client, even when we are not actually present in the room with that client.

Image [cc]  JaseMan

The comment I hear a lot when the words “technology” and “legal industry” are mentioned in the same sentence (besides a quick chuckle) is that we tend to be five years behind the rest of the world. I obviously can’t see you, but go ahead and raise your hand if you are still running Windows XP at work… how about Office 2003… Internet Explorer 7 or 8… If you’ve had to confiscate a Partner’s computer because he illegally put a copy of WordPerfect 4.1 on his firm laptop… Okay, everyone put down your hands.

Just because the legal industry is slow to change when it comes to new technologies, doesn’t mean that there aren’t a few that sneak through. We asked for your perspective on what technologies you think are innovative and have made it into the law firm environment. Although we didn’t get a lot of responses, we did get some thoughtful ones. Perhaps there are some additional products out there that you don’t see listed below… if so, put it in the comments and I may even place it back into to main post in order to make it more visible for readers that find this post later.

Next week’s Elephant Post (see below) is a question that Toby and I came up with while attending the ARK conference on Knowledge Management. It deals with a scenario where you could re-brand your Industry/Profession, what would you call it, and how would it be positioned to be ready for the future. So, read through this week’s, comment on any additional tech you like, and then go ahead and fill out the convenient form for next week’s question.

Steven B. Levy
Author, speaker, trainer, consultant….
OneNote

I’m sure others will cover the more obvious answers, from Legal Project Management to easier timekeeping to advances in e-discovery.   OneNote is included in every copy of Office 2007 and 2010 (and if you’re still on an older version of Office, stop reading and fix that *now*). It’s an off-center but highly effective place to keep all of your notes — client meetings, discussions, strategy sessions (even those where you’re the only attendee), etc. You can even record meetings (or depositions) and annotate as you go, so that when you click the annotation the recording plays in synch with it.  It does take a bit of experimenting to figure it out — not how to use it, which is super-easy, but *why* to use it.  It can also be set to automatically back itself up online, and even to synchronize notebooks automatically between multiple computers.  And you can with one click share a page with someone else in your firm so you can collaborate on the fly, in effect giving you a shared whiteboard.  There is a free alternative called EverNote which isn’t quite as powerful or elegant but works well for those who aren’t Office users.

John Gillies
KM lawyer
Kiiac

This is the tool that finally enables us to analyze a representative set of a particular document type to discover the most commonly encountered structure to the document, the clauses that should be included as the core clauses, the deal-type or matter-specific clauses, and the unnecessary ones. This provides invaluable assistance in not just creating but maintaining precedents. Further, it has a built-in document assembly tool. And finally, it enables a benchmarking comparison of a first draft received from opposing counsel against the template, which is not feasible when comparing their draft to your firm’s precedent.

Stephanie Kimbro
Lawyer, Author, Tech Evangelist
Web Advisors/Calculators

The addition of web calculators and advisors to the law firm website serves a number of different purposes that benefits the firm and the prospective client. These online tools are forms of unbundled legal services and can be provided for free or for a charge. There are child support calculators, term sheet generators, fee calculators that firms will create and embed on their websites. This increases the SEO for their site and also invites leads to the site to engage with the tool. Some of these tools will have document assembly or automation systems integrated into them so that the prospective client is able to input their data on their own and then has the option of taking that information, whether it’s a calculated number or a legal form, and proceeding on their own or turning to the firm for either full service representation or for additional unbundled legal assistance. A large number of these folks use the tools and realize the value of the attorney and that they need that additional assistance and a prospective lead is converted into a paying client. These tools can be used by private practitioners and law firm and by the legal services industry to assist pro se litigants through the justice system.   A2J Author is a great example of the application of a web advisory in the legal services industry.  In private practice, Lee Rosen of Rosen Divorce Law Firm’s, child support calculator or Wilson Sonsini’s term sheet generator are good examples. Also, take a look at FairOutcomes.com which is a fair buy-sell online tool that uses game theory and could have many interesting applications for unbundling use within the legal industry. I think we will also see more ODR tools developing for use by practitioners. These are all forms of unbundling and as the profession becomes more commoditized, we will see innovative tools being developed that facilitate delivery of limited scope services online.

Katie Sunstrom
Lawyer
web based collaboration tools

We have clients that are constantly on the go.  Web based apps such as google docs, dropbox, Basecampdropbox.  I have not used it with clients because I’m concerned about security but I’ve used it extensively in event planning and sponsorship tracking, etc.

Next Elephant Post Question:

If you could re-brand your profession/industry, what would you call it? How would you position it for the future?

Think about when someone asks you what you do, and how you define your profession. I’m a “Law Librarian.” I’m a “Knowledge Manager.” “I’m a Lawyer.” “I’m a technologist.” So on and so forth.

Once you say this, do you think that the person asking the question has suddenly place you in a box and has made many assumptions on what you do? Do you think that what they are thinking is actually what you do, or is it a narrow (or perhaps wrong) definition of what you actually do to bring value to your profession, your industry, and to your specific work environment?

I sat in at the ARK conference on Knowledge Management and listened to many of the same stories that I’ve heard for years in Law Library conferences. “Should we re-brand ourselves?” “Should we call ourselves something else in order to better define the value we bring?” “Are clients refusing to pay for our services because they have a false perception of what we actually do?”

I’m guessing that Librarians and Knowledge Management leaders aren’t the only ones that feel limited by the stereotypes that surround our professions. Therefore, we want to hear from you on what you would do if you could re-brand your profession or industry. What would you call it? Would you keep it the same? How would you advertise your skills and the value that you and your peers bring to the table?

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Purchasing a notebook computer requires balancing three distinct parameters, portability, capability, and usability.  These three parameters are different for every person and as such, each buyer must adjust the value of these needs accordingly and make a purchasing decision that most closely aligns with their particular requirements.
Portability This is the most obvious parameter to consider when purchasing a notebook: the size, weight, and shape of the computer.  How easy is it to carry with you?  Does it easily slip into a bag, or does it require it’s own case?  The difference between a 3 pound laptop and a 5 pound laptop can be the difference between carrying it with you everywhere and leaving in the office on the desk.
Capability This is usually the second consideration when comparing notebooks; the specifications of the computer itself.  How fast is the processor?  How big is the hard drive?  Historically, the smaller, more portable, notebooks were limited proportionally in capabilities.  That is no longer the case.  The capabilities of most notebook computers can compete with your average desktop regardless of size.
Usability This is probably the most important of the three parameters and yet, it is typically the most overlooked.  How easy is it to use this computer in the manner that you intend to use it?  This parameter is often confused with portability, in fact, portability is a subset of usability, but it is useful for our purposes to consider them separately.  How does the keyboard feel?  Is the screen large enough to use for long periods of time without an external monitor?  Can you connect an external monitor?  A second external monitor? What connectors are built in? Which type of display connection? USB? Ethernet? Does the notebook have a docking station to connect all of your peripherals in one action, or will you need to manually connect monitors, keyboard, mouse, etc. each time you put your notebook on the desk?
When making a single purchase the right balance is a personal preference.  There is no one correct answer for the entire population.  If I am checking emails, surfing the web, connecting to a virtual machine via VPN to do most of my work, and traveling 6 months out of the year then portability is going to be my top priority.  The heavy lifting of computational ability will be done on my company’s servers somewhere far away, I don’t need to carry a particularly capable device to be able to do my work.  If I use my notebook to run virtual servers to showcase my company’s server based product on a stand alone machine, I need to make sure I’ve got a fairly powerful device that is capable of running both client and server side applications.  In that case, capability trumps the other two parameters.
If, however, you are purchasing a fleet of notebooks for a large number of professionals, each with different needs, then the balance of the three parameters needs to shift heavily toward usability.  Portability and capability are still important, but once a certain minimum level of portability and capability are met, usability should be the top priority.  This is the situation faced by law firm IT departments as they choose a firm-provided model notebook computer and this is where the consumerization of IT hits a wall. 
Consumer level devices are made for personal use.  As I’ve argued above, the needs of an individual may be wildly different than the average needs of the population.  If the individual has personally chosen to make due with the limitations of the consumer device, that is an acceptable trade-off.  If however, the enterprise purchases consumer level devices and distributes them to their user base, the trade-offs may be entirely unacceptable to a large portion of the user base. 
Let me use the Macbook Air as an example.  I love this computer.  It’s beautiful.  It’s elegant. I would love to own one for my personal use.  But it’s entirely unacceptable as a fleet notebook in a law firm.  It certainly meets and even exceeds the portability and the capability minimums, but it falls woefully short in usability.  Here, the culprit is not the screen or the keyboard, but the connectivity of the device.  First, there is no docking station.  It may seem like a small trade-off for such elegance, but after a year of manually plugging in and unplugging 5 or more peripherals each time you get to the office, you’ll wish you had a docking station.  Secondly, there is no VGA or DVI monitor connection.  I know, VGA is so last century.  I agree.  Unfortunately, most projectors in the world still use VGA.  If you want to use your shiny new Macbook for presentations, you’ll need to carry around a Thunderbolt/Displayport to VGA dongle.  While we’re discussing necessary dongles, the Macbook Air is designed to be used wirelessly, it doesn’t have an Ethernet port.  You can’t connect it to a wired network without the USB to Ethernet dongle.  Not a big deal, until you are in a hotel room with a broadband connection, but no wi-fi, or if you are at a conference with 500 people trying to get on wi-fi and can’t get an IP address.  At that point you’ll need the dongle.  Optical drive?  There isn’t one.  No watching movies on the plane, or loading up the client’s latest software on CD.  Unless of course, you have the USB DVD drive. Once you pack all of these peripherals into the bag, the portability of the device is severely diminished and judging by the number of power supplies I’ve seen attorneys go through in the three year lifetime of a single notebook, the firm would have to purchase dongles and peripherals by the truckload.
Now, I don’t mean to pick on the Macbook.  I am admittedly an Apple fan boy.  I really do love this device.  There are plenty of similar Macbook Air wannabes on the market, but I don’t believe any of them are currently appropriate enterprise devices.   When wi-fi is ubiquitous, no one uses optical storage anymore, Displayport projectors are the norm, and all peripherals are wireless, then maybe we can roll out consumer level notebooks.  Until then, as much as it pains me to say, we should probably stick the boring, ugly, corporate notebooks with acceptable portability and capability, and extreme usability.

For the upcoming COLPM Futures Conference, I was tasked with defining value in value billing for law firms. This is a great problem to tackle. I think the market has given us a lengthy list of value billing propositions clients want, but absent getting full-rates (which is a myth by the way), not many talk about value in value billing from a law firm’s perspective.
I have previously discussed the ongoing shift towards a profit-margin business model for firms. This shift is a key factor in defining billing value for a firm. At its most basic level, what firms need is a reasonable fee for a defined piece of work. (My own opinion is that rates are becoming much less relevant within this context.) The problem is that clients, in addition to wanting lower prices (rates or fees) are asking for pricing without giving much, if any, scope – and are staying very involved in the details and staffing aspects of work.
And now for my Typical Car Analogy: That’s like saying you will pay $30k for a car, then over time, bit-by-bit, your ‘feature’ requests spec out an S Class Mercedes. If the law firm knew up front, even from a general idea that you wanted a luxury sedan, they could have given a competitive price and known whether or not they could make money on the deal.
I know this sounds simple. And that it isn’t. Yet.
Law firms and clients are in the process of learning how to set prices at the fee level and develop some level of scope for each engagement. Part of the goal of the value session at the COLPM conference is to begin developing standard terms of art and other building blocks to facilitate and accelerate this process.
And now for The Value Billing Value Propositions for law firms:
#1 – Relationship Building. Since the legal market is driven by relationship, developing broader and deeper relationships with clients has the highest value. Value billing presents that opportunity.
#2 – Expand the work – as appropriate. Yes – firms would like to grow the business. As opportunities come available, law firms will find value in expanding their presence with clients, leveraging value billing in the process.
#3 – Ability to earn a reasonable margin on the work. Yes – firms want to remain financially healthy. In a profit-margin business model this comes about via reasonable prices on known scopes of work. Value billing presents this opportunity as well.
So the question then becomes, what needs to be in place for these value propositions to materialize? Which leads us to my Value Billing Wish-list for a law firm:
1) Client knows what its fee goal is (beyond cost containment)
a. e.g. predictability, certainty, risk/reward alignment, …
2) Absent #1, client is willing to sit down with law firm to explore and determine what #1 should be.
a. BTW – Vague or broad RFPs run counter to this.
3) Client will give at a minimum, some level of scope
a. Or even out-of-scope assumptions
4) Absent #3, client is willing to sit down with law firm to explore and determine what #3 should be.
5) Client understands their outcome goal for a given matter or group of matters
a. e.g. What is the risk factor driving a higher or lower fee?
6) Absent #5, client is willing to sit down with law firm to explore and determine what #5 is.
7) If client has an idea of what they want to spend for a given piece of work (a.k.a. its value to them), they share it with the firm(s).
a. This will open a dialog to the level of effort that may be needed and where that effort should be made.
8) Client engages with a firm as a partner, working together to manage costs and insure value
a. For instance, consider committing larger volumes of work to a firm. The cash flow and knowledge gained over time by the firm will enable savings for the client and profitability for the firm.
9) Once a fee arrangement is in place, client lets the law firm manage the work
a. Especially under fixed fees, firms will be motivated to use the right level of expertise for each task (even when it’s a first year lawyer).
10) Finally, and most importantly, client is willing to engage in a sincere, trusting relationship with the firm. Without trust, none of the above matter.
The theme of trust obviously emerges from this wish-list. And that is the bottom-line. In my humble opinion – value billing works when there is trust. The wish-list provides opportunities and ways to build that trust.
To move in that direction, clients should recognize this need for trust and take an active role in working with firms to drive a new value model: one that achieves the goal of controlling costs while maintaining quality. And one that insures financially healthy partners, committed to clients’ success.
Trust me … trust is the answer.
Image [cc] AsGood

Tom Baldwin and I will be “debating” the issue of Knowledge Management and its strategic reach… or is it “overreach” at the ARK KM Conference this week. As I’ve been going back through my previous discussions and presentations, one thing kept coming back into my head that made me wonder whether KM and Library are flip-sides of the same coin when it comes to balancing the mission of the department against the projects we take on and support on behalf of the law firm.

There have been many times where I’ve talked about what I’ve perceived as a “desire” by many law librarians to go back to a standard definition of what a law library does, and spin off any activities that are outside that narrow definition. New ideas that have sprouted out of the library – Knowledge Management, Competitive Intelligence, etc. – tend to evolve to a point in the library, then are pushed out into other departments, or even into their own individual departments. The library is then brought back into line with the mission of collection and research of external resources that support the needs of the firm.

Now, let’s think about what Knowledge Management has been doing over the past three or so years. There have been many great ideas, products, procedures, and processes that the KM groups have implemented. Unlike the law library, however, there really isn’t a “standard” in the Knowledge Management domain that discusses the boundaries of what KM’s core duties are. In fact, give me 30 different law firm KM departments, and we can probably come up with 30 different mission statements. Yes, many will come up with the old generic statement of “providing the right information, at the right time, to the right people” definition. Unfortunately, if you really boil that language down, it is so generic, that the Library could use it… IT could use it… Biz Dev could use it… heck, an attorney could use it in describing what he or she does for a client… so on and so forth. So this got me wondering – could a basic problem with such a diverse KM world be that it doesn’t know what to keep and what to spin off? In other words, the Library tends to have its projects moved to more appropriate departments, while KM is stuck supporting all of its projects and has to take on more and more.

I poked fun last year after attending the ARK Conference on KM when I wrote a post called “You Can Call it Knowledge Management if that Makes You Feel Better About Yourself.” In that post, I asked what happened to KM? When did it become a resource for placing an interface over financial applications, and creating dashboards for third-party products? Knowledge Management suddenly became the resource for law firms to use to make “cool and useful interfaces” and had ditched the more traditional process of creating the traditional “Collective Knowledge” through either automation and participation. A year on, it seems to me that KM has a bigger problem in that it now is expected to actually produce the “cool and useful interfaces” and at the same time, figure out a way to maintain collective knowledge through automation and participation. To make matters worse, the automation and participation part of their mission has to be accomplished in a way that doesn’t affect the way lawyers perform their day to day work flows.

So, how does KM decide on what projects it needs to take on and develop? How does KM decide what projects need to be killed off? What can KM do to spin off projects that need to be maintained, but no longer needs the specific skills of the KM team? If those questions can’t be answered, then KM will find itself over-extended and buried under its own weight of project upon project, interface upon interface, and process upon process.

One of my KM friends talked about walking this fine line between obvious projects of KM and necessary projects for KM. I’m afraid that I’m paraphrasing this a bit, but basically there are two reasons to have KM projects:

  1. There is a need within the firm that keeps Partners up at night and KM can solve this issue.
  2. There is a need within the firm that KM can solve, even though the issue may not be one that Partners are asking to be fixed. (AKA – Sticking Your Neck Out Projects)
If the project/process/procedures don’t fit one of these two reasons, then KM shouldn’t be supporting them. 
Of course, it is easy for me to sit at a keyboard and type out that last sentence. It is another thing altogether to step up and either kill an existing project, or position the project so that another department can take it on, or announce that there are projects that should be outsourced to third-parties outside of the firm. If none of those options can be made, then you have to start talking about increasing personnel to support them (and we all know how those conversations go.)
These aren’t easy issues to solve… but solve them you must. To borrow from Toby’s post on Friday – It’s either that, or pick an easier profession.

Having been in the legal business for 25+ years, I have long marveled at the machinations of lawyers over their billing rates. I recall being a bit shocked back in the 80’s when I first saw lawyers having fits when “The Firm” raised their rates – yet again.
Why was I shocked? Only the week before these same lawyers had been bragging about how awesome they were in court and about the high-value results they delivered to clients. So which is it? As a lawyer are you highly valuable (justifying a higher rate) or are you low value? At the time I remember thinking, “Pick one option and go with it.”
Fast-forward to the present – and just like all things in the legal market – we are still having the same conversations. In talking with a colleague from another firm, the rate-increase topic came up. He was lamenting his upcoming, potential rate increase. He noted how poorly he predicted clients will react to ANY rate increase, especially in this market.
So I asked him my old question. He didn’t like it.
After he calmed down I shared some thoughts with him.
Rate increases are a relationship building opportunity, but only if you treat them that way.
A better question for my colleague: “How many clients just pay your rate without asking what it is?” I’m guessing not many. What this means is you should already be having these conversations with your clients. Rate increases are an opportunity to get in front of clients and engage in conversations about pricing options for the coming year. Isn’t this what clients are asking you to do?
Rates are a tool, but should not be treated as a hammer.
Why treat your published rate like it’s chiseled in stone? Rates are merely the starting point for rate and fee conversations. Come to grips with the notion that price increases are a fact of life in business. However, the days of sending letters to clients announcing your annual rate increase are over. What’s important now is how increases are communicated to clients. (In-person is the right answer – btw.)
Rates matter, but fees matter more.
Have conversations with clients about pricing, versus rates. At the end of the year, or end of a case, what really matters to a client is the fee. How much did the case or deal cost them? Your rate could be $10 per hour, but if you took 100’s of hours to complete a task, the fee is going to be high. A challenge here is that clients tend to compare pricing on a rate level, instead of a fee level. Use the price conversation to help the client shift their thinking towards fees. In the long-run this will greatly benefit them and solidify your relationship with them.
It’s Not Easy
I know … having pricing conversations can be challenging, especially in the current environment. The new question I should start asking lawyers: “Did you pick law because you thought it would be easy?” I’ve yet to meet a lawyer not up for a challenge. They just need to add pricing conversations to their list of worthy challenges.
It’s either that, or pick an easier profession …