Law firms have a wealth of information available in their organisation but are unable to access much of it. Andy Sparks discusses how to maximise usage.
Mergers are viewed as means for growth for the modern law firm: building a national presence, driving international expansion, and better serving global clients. Indeed, for many firms, this is the primary way to deal with market changes and even survival. According to legal consultant Jomati, merger activity among the top 100 law firms reached a record level in 2013. This trend is expected to continue in 2014.
While the jury is still out on whether big firms are necessarily better, the underlying objective must be to deliver increased value for shareholders. For merging firms, this requires ironing out the operational and cultural issues that individual firms bring to the table and finding levers to drive top (and ultimately bottom line) growth. Only then can the merged entity derive the most value from its combined operation and deliver against stakeholder expectations in the mid to long term.
Evidence from LexisNexis’ customer base suggests that more than anything else, firms today are most challenged with how to change the way they operate; this issue is exacerbated in a merger scenario. Adopting the right technology can facilitate (and to an extent help mandate) change by providing efficient and joined-up access to the required business operations.
In one sense, this is simply about using technology to reflect the way the business wants to work. For example, a financial management platform enables the business to manage a single P&L and allows users in multiple locations to seamlessly work on shared client files. There are tools that let the business manage and develop a global workforce, and report on client, matter, and departmental profitability. Solutions for customer management and business development help exploit the shared connections across the entire business.
Most firms have a wealth of management information residing in their organisation, but it is often disjointed and inaccessible. Timely and clear reporting is necessary for informed decision-making. An understanding of a firm’s health metrics offers the opportunity to identify areas to drive down costs, create more efficient workflows, enhance productivity and even do things differently. End-to-end, fully-integrated, cross-department technology platforms automate and combine time recording and billing. This gives clients transparency of how their budget is spent. Such systems provide insight into resource utilisation; and where tangible improvements can be made globally for value to clients, better client-win rates and profitability. They come with built-in business intelligence reporting functionality.
Especially in a merger situation, human resource must be carefully managed. Technology allows this function to be integrated with all other firm-wide workflows and IT elements. This can help merging organisations establish their own individual culture and style of operation. Firms can undertake talent management too – identifying and rectifying gaps in skills, attracting new talent, developing reward and motivation schemes, and so on.
A well-rounded understanding of customer requirements is essential to being able to identify new service and cross-sell opportunities. Customer Relationship Management systems provide relationship intelligence that exposes the deep-rooted interconnections between individuals and organisations. This can serve as valuable input for business development and revenue generation activity. More importantly, firms can use the insight to ‘listen’ to clients, and improve the experience that clients have in dealing with the organisation.
Flexibility and agility
Law firms require flexibility, agility, efficiency and scalability to meet/exceed business targets. So ‘change’ must be a constant and embedded in the organisation. Firm-wide technology systems enable exploration of new ways of working, fine-tuning of business processes, adoption of innovative pricing models and cost adjustments – in tune with market requirements. Formula 1 comes to mind here – the teams that win are the ones that are able to continuously make small incremental improvements to their operations during the race.
Newly merged entities need to articulate a vision, develop a strategy based on sound business/market insight and create an internal environment to enable that vision. Otherwise, organisations may find themselves ineffectively propping each other and defeating the very purpose of their merger. Law firms will find value in adopting integrated business management systems that offer interconnected capabilities to facilitate efficiency, develop new services and drive down costs.