The changing nature of Australian law firms– We have experienced >two decades of profound transformation– Mergers, consolidation, globalisation, technology, new law firm models and changes to the work force
Industry numbers: 10 year snap shot*Key statistics 2001-2002 2010-2011Revenue $16.8bn $23.1bnEmployment 103,858 126,416Enterprises 18,087 16,398Revenue per employee $161,800 $182,700Wages $5.8bn $7.08bn*IBISWorld
But law firm cultures are changing“Increased work intensitycannot be sustainedforever, so my analysispredicted that the above-average productivitygrowth would bereversed as Australian Top: Average hours worked (ABS)workers reclaimed Average Wage Average Wagecontrol of their lives in a $60,000 $60,000 $59,500 $59,500 $59,000stronger labour market… $59,000 $58,500 $58,500 $58,000 $58,000 $57,500 $57,500 $57,000 $57,000 $56,500 $56,500 $56,000 $56,000 $55,500 $55,500 - John Quiggin (UQ), AFR 20 August 2011 $55,000 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 $55,000 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Average Wage $55,961 $56,227 $56,134 $56,400 $55,905 $57,117 $57,583 $57,230 $57,394 $56,072 $56,344 $56,726 $57,277 $57,501 $57,890 Average Wage $55,961 $56,227 $56,134 $56,400 $55,905 $57,117 $57,583 $57,230 $57,394 $56,072 $56,344 $56,726 $57,277 $57,501 $57,890
The good times are over? Or are they… Revenue % growth* 9 8 7 6 5 4 3 2 1 0 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Revenue % 7.9 6.9 5.4 0.8 1.1 4.3 1.2 2.2 2.9 3.1 2.5 3.9 3.5 3.5*IBISWorld
Overpaid, overqualified and over here…– The arrival of some of “The global financial crisis forced aa “The global financial crisis forced rethink on growth for growths sake the large US and UK rethink on growth for growths sake while reinforcing how global and while reinforcing how global and firms is having a interdependent world society had interdependent world society had become… profound impact on the become… Australian legal industry The right model for globalised legal The right model for globalised legal services needs to consider the growth– Most likely we will see: services needs to consider the growth regions, sustainability and ability to regions, sustainability and ability to • Further mergers/poaching export legal services. Access is export legal services. Access is important, and sometimes the most of talent important, and sometimes the most direct path to an international market direct path to an international market • New entrants is not the most suitable.” is not the most suitable.” • Moves into Asia and - Don Boyd, Deputy Chief Executive Norton Rose in Africa - Don Boyd, Deputy Chief Executive Norton Rose in The Australian, 3 June 2011 The Australian, 3 June 2011
Good reasons for moving into the region– Why large multinational firms are looking to are region?– IMF Word Economic Outlook 2011– Growth in GDP: • North America and Europe “slow” • Asia and Africa growing • Apparently Mongolia is the place to be!
Other factors…– The challenge of an ageing work force, which will most likely increase the cost of labour (reducing profitability)– Disruptive technologies as represent both threats and opportunities– Commoditisation of technology and information… the “iPhone effect” that makes technology cheap, fun and accessible** Ask yourself, just how “cheap, fun and accessible” are law firm systems?
Why we should care– Australian firms cannot afford to “stand still”– This have implications for the type of: • Services we offer • Staff we employ • Technology we deploy • The perceived value we add to the firm– Ask the question: • “How can you help the firm grow, retain talent and differentiate itself from the competition?”
Implications– The bad news: • Pressure on budgets • Pressure on services to meet increased demands – both volume and sophistication • Pressure on staff retention– The good news: • Represents opportunities that are both challenging and add value to the business
Trend: the decline of the AFR as anauthoritative source– For some time we thought giving staff access to the full text of AFR articles would be a worthy goal: • But then reviewed our statistics in regards to retrieving full text AFR articles from our news clipping services • On average, we retrieved x2 articles per month • Our users happily exist without it– Users will “find a way” by themselves– Reflects a general decline in the popularity of traditional news services
The decline of the desktop– Our services, technology and infrastructure is built around a platform in decline*– The number of desktops being “shipped” is small in comparison to mobile devices * Morgan Stanley, Web 2.0 Seminar 2010 (held San Francisco)
The written word is far less important– North American internet traffic has seen a rapid growth in video related content– 35 hours of video content is added to YouTube every minute– Increasingly, much of this is accessed via “mobile” devices
Social networks becoming the newinformation portals– Recent McKinsey research* based on 100k respondents to survey questions indicate: • For people under 34 the preferred channel (minutes per use) displacing email/text • 33% use social network platforms to navigate content on the web – up from 13% in 2008 • Yes, search engines are losing out to social networks as “gate keepers” • Smartphones becoming the preferred platform of users* Are your customers becoming digital junkies? McKinsey Quarterly July 2011
Node of trust: new versus old media– Report “Reporting war, waging peace: the impact of new media technologies” (P. Mirchandani)– New Web 2.0 technologies have: • “thrown into turmoil traditional media’s business models” • traditional communication practices “are losing trust and relevance
What is a “node of trust”?– Audiences demand the right to “New media have introduced aa “New media have introduced changed concept of aa“node of trust” “talk back and be heard” changed concept of “node of trust” ––ititcan now be an individual, aa can now be an individual,– Users have adopted the notion website, aanetwork, aablog, an website, network, blog, an Internet TV channel ––which people that “sharing is cool” Internet TV channel which people turn to for information…” turn to for information…”– The line between “professional and amateur” is blurring for users– New media is “eroding attempts at control”– Influence is generated by “nodes of trust”
Its not the same “internet” we grew up with– Users built networks and solutions from the bottom up– The peers and social network of users are a vital conduit of information– Less a “culture of the book”, and more of a “culture of video”– The web has “decoupled” from the desktop, and now mobile– Users want control and a voice – indeed, the expect and demand it if they trust the platform
Who we service?– Question: do we continue to add a “full service” model in the hope we touch every part of the business?– Answer/s: • Given the pressure on costs and resources, be strategic in your choice of who you service • Conduct a “customer segmentation” exercise • Determine out which parts of the firm are growing • Worry about those groups/individuals who don’t use your services only when they “pester you”
Align your business model to firm strategy– Question: how can information professionals add value to the business?– Answer/s: • Carefully align your services, collection and the skills of your staff to firm strategy • At Middletons we conduct an annual planning session, in which the firm strategy is the “foundation” • All new products and services match growth areas for the firm – “ruthless” in selection • Developing subject matter experts on a small range of subject areas
Accept the brave new world of the internet– Question: how can we ensure users remain faithful to “authorised” sources of information?– Answer/s: • Educate them on sources, but don’t worry about it – we’ve lost that fight • Look at it from a risk management perspective and judge potential negative impacts on the business (low-medium-high) • Explore Web 2.0 tools, but don’t race to embrace them all – ask what suits the culture of your firm • At Middletons we are “retiring” resource guides and handouts – web based “gadgets” or even Smartphone apps will most likely replace them
Allows users to “talk back” and control thespaces– Using the “node of trust” content, explore how users can take control of the platform– Provide them with the tools, then let them organise the spaces/social network– Involve users in technology development– At Middletons we are redesigning our catalogue: feedback was essential– The new “catalogue” will be tailored to the user: • allow them to favorite materials • keep all their past research requests • alert them to new resources specifically related to their practice area • Have quick links to the “top five” most frequently used resources • Allow them to see what is “popular” in their groups– Catalogue conceived in “pragmatic terms” – we know they use Google!
Think beyond the desktop and othertraditional services– Smartphones, the “cloud” and mobile internet will be upon us soon– Start thinking about non-desktop services (i.e. Apps)– At Middletons we are exploring “just-in-time” video/online training to compliment traditional training services
The “broker” model– Too often information services become straddled with a range of “knowledge” activities or business units– Advise information managers to pick your “niche”: • Advanced research? • Business or market intelligence? • Knowledge management? • Integration?– Market you services in a “personal” manner– Deliver to you clients a range of “bespoke” solutions, customised to their needs– Allow them choice
Our response– Research desk: the “call centre” Information with one phone number with work Services being picked up by anyone rostered on– Focus on projects that have positive impacts on business and can be Learning Collection Innovation & delivered in reasonable time frames Management Technology– No catch ups for the sake of “catching up”: meetings are project based– Structured Information Services to meet the changing needs of the firm (see right)– Quietly dropping products and services that no longer “add value”– Streamlining our services to match strategic direction of firm
QuestionsFurther informationMichael Marriott | National Information Services ManagerT: +61 9205 2171E: firstname.lastname@example.org Insert FileSite number or delete text box
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