What KM support does the business really need?

There may well have been a shift in overall strategy for your business as a result of the recession. It is crucial that you are aware of any changes, no matter how subtle, and that your KM strategy is completely aligned, or re-aligned, to meet this. When funding is tight and all practice areas are making requests for limited resources, you must demand convincing business cases to support new areas of expenditure. All areas will need to be maintained but you need to ensure that the bulk of any new investment is directed towards those areas which need it most in the context of current strategic direction.

Be ruthlessly objective in assessing your current portfolio of KM products and services. Any services in which you invest time and resources have to be valued highly by the business to justify continued investment. Questions to ask include:

How much does this service cost us?

It can be extremely illuminating to explore the full cost of delivering any service. Take, for example, an internal current awareness service. If you manually scan, edit, compile and circulate an update, the cost may appear to be relatively low. If, however, you measure the time taken to produce this update, combined with the pro rata salary costs of team members involved, it can start to look like a very expensive service to deliver. Who receives it and do they even have time to read it? Does it support current strategy? Evaluating the value against the cost, can you justify continued delivery? Even with electronic current awareness feeds, there can still be an element of editing or re-formatting – what is the combined cost of the commercial product and the internal resource? Again, is it worth it? Does a reduced requirement for KM input, as a result of introducing multiple RSS feeds, for example, always save money, or can it lead to more lawyer time spent sifting and reading multiple alerts? Is that good financial management? The answer will differ from service to service and business to business, but brings us back to the point of strategic value. Is the service valued beyond “interesting to receive.” Has it actually led to new or retained business?

Can we do it faster, cheaper and better?

It is a common perception that trying to deliver services faster and at less cost results in a deterioration of quality. This does not have to be the case. E-learning, for example, has revolutionised the way in which some law firms, particularly multi-site operations, deliver training. Interactive webinars now take the place of group training sessions, large or small. A session on European legal research techniques, for example, can be delivered in real time with participants working through slides and the trainer providing commentary and explanation. Questions can be asked verbally or posted on screen for all participants to see and comment upon. Crucially, the participants are in many different locations from Paris to Cardiff, at their own desks. The webinar can be recorded and accessed by individuals unable to attend the live session, or used as a refresher by the original participants at a time to suit them. The alternative would be to have a trainer on site, or travelling to every location where many participants may not be able to attend, necessitating constant catch up. People will always prefer face-to-face interaction, but this is a very good alternative option with distinct advantages and to maintain the on site approach, in light of this, would simply be un-commercial and unrealistic.

Can someone else do it faster, cheaper and better?

Those of us who are considering outsourcing for the first time are in a potentially better position than others who pioneered this approach.

“The credit crunch can be seen to be undermining the economic model of outsourcing with discounts offered in the early years of a contract disappearing in the face of a recession…. the crisis is having a dramatic effect on the pricing of long term outsourcing deals.” [Computerworld UK, 28th Jan 2009]

Off-shoring or outsourcing is often seen as a threat to KM teams, but it can equally be seen as an opportunity and does not always equate with headcount reduction. The time of the onshore team may be released to work on more challenging and added-value KM service delivery. It would be foolish not to look at the options available.

Any outsourcing opportunity must be explored in detail and you need to be very sure that it will actually deliver a positive impact to the bottom line. The higher the salary of the KM professional, the more likely is a reduction in cost achievable. If the tasks currently performed onshore are delivered by relatively junior staff on average KM salaries, your costs, which will include the salaries of the off-shore team, the on-shore management costs and any additional licences for subscription sources, may only just break even. When you add intangible costs to the equation, such as training time for the off-shore team, quality checking and potential delays in turnaround, you might not achieve the cost reductions you were seeking. Conversely, paying an annual subscription fee for a generic knowledge service which, to replicate internally, would involve the recruitment of a far higher number of highly skilled knowledge professionals, can be a very sound and sensible investment.

Budget: realising cost savings to implement strategic investment

“The overall impact of service delivery will be key in the external client chain and will impact on profits.” [Legal Week 20/7/2009]

The credit crunch has, in some cases, actually helped KM teams push through efficiencies and cost-cutting measures which could have been very difficult to gain support for before the credit crunch, so it is not all bad but… we must be innovative enough to maintain excellent standards of service delivery even though resources are reduced. Only when you have reviewed your services, verified their value and aligned them with strategy are you ready to consider your budget. The majority of us took pride in running a “tight ship” well before the credit crunch. Mid-crunch however, any “wriggle room” incorporated into even the tightest budget has disappeared and will not be coming back. Many of us have taken, or are considering, cost-cutting measures which we would have regarded as unthinkable only a few years ago but, maybe we should have been more radical pre-crunch? Managing a KM budget through recession calls for innovation and a love of challenge!

KM resources

Have you heard about the lawyer who still uses a quill pen and ink for drafting because, “I'm comfortable with it and I know how it works even though it can be a bit inconvenient sometimes…”?

No, neither have I, but I am sure you have heard of the lawyer who still insists on using hard copy Halsburys Laws with a manual index of several volumes. even though he/she has a fully searchable, full text, electronic version on the desktop. Essential handbooks aside, providing duplicated formats is a luxury very few of us can justify, particularly when the hard copies have to be replicated across multiple office locations. Only a few years ago, withdrawing hard copy would not have been considered an option, but an increasing number of firms are weaning their lawyers from this format. Active and ongoing promotion of, and training on, desktop resources not only assists this transitional process but also leverages full return on investment. Regular analysis of usage metrics of volume and types of use also facilitates this approach. Equally, can we really justify subscribing to multiple aggregator, multiple publisher products, at significant cost where a large degree of overlap clearly exists? Are the few, unique modules/sources available really worth the full subscription cost of the total product? I do not think so.

A wholesale review of journal subscriptions can yield surprising results when a practice group is given a public, target reduction to achieve or, for example, is told that they can have the new resource they are requesting, if they are able to cancel an existing subscription for a similar amount. The by-line of “is it essential or nice to have,” comes into its own in these circumstances. How many lawyers do you know who actually have the time to read all the journals to which they subscribe? The essential ones will be read but the “nice to haves” will languish in the Outlook folder or under the desk for several weeks if not months. Only a few options are discussed here, but there are numerous ways in which we can, at least, try to realise savings. Opportunities for income generation, although not so numerous, do exist. The key to achieving radical budget management lies in the ability to deliver an innovative yet pragmatic business case and, as in so many other things, earning buy-in and visible support at a very senior level in the business.

KM headcount

Having identified your essential services, inevitably you must consider the level of staff required to implement and deliver them. Many law firms have, unfortunately, over the last year, suffered redundancies across legal and business support teams. If you should find yourself in the difficult position of having to reduce headcount, retaining your objectivity, transparency and sense of fairness is crucial. A manager must strive to achieve what is best for the business and look outward, not inward. The KM team must be considered in parallel with other support teams. Any duplication of effort and resource must be identified and appropriate skills must be aligned with appropriate tasks at appropriate cost levels. Are current work models efficient/still valid – would restructuring deliver what the business needs? Clients in in-house legal teams often deliver with very little knowledge resource and support - how do they manage and what can we learn from them?

What skills are needed to deliver these services? Above all, we need people in our KM teams who understand, or who have a real willingness to learn about the business, the legal sector and the industries in which our clients operate. Crucially, particularly in this economic climate, they need to be innovative with a strong commercial and pragmatic approach. The ability to market themselves and the team, communicating and building relationships in virtual environments is vital, together with the ability to negotiate, at a senior level, internally and externally. Self-belief and acceptance within their legal peer groups is particularly important. Do these skills and attributes matter more than a professional information or knowledge qualification? For me personally, the answer is a resounding yes. I would far rather hire for attitude and train for skill. It is a bonus if they have the qualification and the “attitude” skills set, but the lack of formal qualification does not preclude the offer of employment for me.

Is the credit crunch a KM opportunity in disguise?

Think about it. Has there ever been a better time to argue the business case for KM and a good know-how system? Most firms are experiencing a higher number of staff departures than they have seen in recent years and those leaving are taking their knowledge with them. Highly experienced individuals are leaving firms not through lack of ability or knowledge, but as a result of current market conditions. We should at least be trying to retain their knowledge. The exodus of departing baby-boomers is also starting to hit. What are we doing to capture their knowledge before they go? Shouldn't knowledge capture be part of current exit strategies? Further down the line, when the upturn comes and we need to recruit again, where will our new colleagues turn to gain experienced input and advice? A good know-how system will save time and money and reduce risk. If no formal knowledge systems are in place, but you have access to technology such as Microsoft Sharepoint, for example, you can still quickly and easily provide access to knowledge streams capturing informal know-how via discussion boards and wikis etc.