In a recent research conducted by OMC Partners and commissioned by Practical Law Company (PLC), it has been revealed that “a law firm’s approach to knowledge management has a significant impact on the overall cost of matter delivery”. A report on the research “The knowledge imperative” has been published by PLC. The research has also been analysed by Charles Christian in the Orange Rag article “Research suggest law firm use of knowledge management can cut costs by 25%”.
As summarised by Charles Christian, the report identifies current client pressures and their implications for knowledge. It then distils the best practices observed among the interviewed firms that supported the most successful knowledge approaches. It examines some of the common barriers preventing firms from implementing these. Finally, it outlines some of the improvements seen by firms who were adopting the best practices. Here are the key findings from the report:
Six knowledge best practices
- The firm’s management structure promotes the strategic use of knowledge.
- Knowledge approaches are designed to drive the firm’s competitive advantage.
- While maximising competitive advantage, knowledge comes from the best value source.
- Knowledge strategy supports the systematic improvement of leverage and realisation rates.
- The productivity benefits of knowledge investments are calculated and fully delivered.
- An appropriate level of dedicated resource is allocated to knowledge work within practice areas.
Barriers to increased knowledge efficiency
- Decentralised knowledge functions prevent systematic implementation.
- A misconception about what clients are actually paying for.
- Cultural resistance to working with new technology or external providers.
- The decision-making process for implementing new approaches is dominated by the costs without a rational assessment of the benefits.
- Senior stakeholders in law firms are often the least open to change.
- Under-resourced implementation of knowledge initiatives.
Outcomes for those firms implementing best practices
- Greater client focus.
- Improved risk management.
- Cost reduction – specifically in both the creation of knowledge and in matter delivery itself.