Por y para profesionales del Derecho

Portal jurídico de Aranzadi, por y para profesionales del Derecho

27/03/2023. 03:30:32


Por y para profesionales del Derecho

Brave in the new world (I)

founder of Hedley Consulting Email:

In the current recession, managing partners have a great opportunity to overhaul their information and knowledge-management functions for long-term growth and profitability. To succeed will require addressing critical information and knowledge-management issues, but the results will fundamentally re-shape legal business creating the profitable next-generation law firm.

Brave in the new world (I)

The evolution of knowledge management (KM) and KM systems has been at the core of advances in law-firm infrastructure. This has allowed the modern law firm to create a scalable business in which embedded knowledge can be applied consistently across the organisation to provide consistent, high quality solutions.

As we move towards the second decade of the 21st century, it is right to consider more deeply what the core purpose of knowledge management should be in the next-generation law firm. How is it likely to differ from the current role? Importantly, how can managing partners ensure that their firm's knowledge-management function is prepared for this challenge and fit for the future?

I have written before about the central role that knowledge management (defined in the broadest sense) plays in the modern law firm. When considered at this level, what else does a law firm do but manage knowledge and manage relationships? From this perspective the importance of leading-edge knowledge across the full gamut of the firm's business functions is clear. Law firm management now has an opportunity to trail-blaze the reshaping of law firms through leveraging current knowledge-management skills and developing new ones.

Advances in technology and working practices have enabled a speed of action and insight that would have been incomprehensible only a few years ago. As technology becomes more deeply embedded, the challenge is moving from being efficient to being effective. Being effective means delivering added value and creating distinct and difficult-to-imitate sources of competitive advantage. Efficiency is expected, effectiveness is what is now required.

At the same time, alternative business models are emerging that envisage law firms stripped to their core activities with everything else being subcontracted or outsourced. Knowledge management cannot, and indeed should not, sit outside this trend.

In order to identify the areas in which future efforts should be channelled there should be a disaggregation of knowledge management into its constituent parts and the assignment of ‘value-added' to each component.

In making this assessment a scorecard will need to be constructed that considers and weights the key decision dimensions such as:

  • What is the core purpose of the knowledge-management function, how is this articulated nd how does it map onto the firm's wider vision, strategy and business plan?
  • What elements of the firm's knowledge management and service provision can only be done by the in-house professional?
  • What elements of the knowledge mix can be delivered by external knowledge providers more efficiently or cheaply than by deploying internal resources?
  • What is the opportunity cost assessment of retaining in-house activities that are "at the margin" when set against how the available (and finite) internal resources could be re-deployed to create unique knowledge assets?
  • What knowledge processes are commoditised (or will be commoditised soon) and is the firm best placed to deliver these internally, regardless of how muchthey are a historic vestige of ‘how things are done around here'?
  • Does the skill mix and profile of the current knowledgemanagement team map onto that which is required for the future or will some re-shaping be needed?

By taking a considered and rational approach, two immediate issues are addressed. First, due consideration is given to what should (and what should not) be ‘in play'. Second, the process provides transparency for the firm as a whole to understand the priorities of the knowledgemanagement function and to appreciate why change is necessary.

Published in 'Legal information in a recession: A restructuring opportunity'

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