Very few businesses have had to adjust to a more profoundly different marketplace than large law firms have in recent years.
Corporate clients are under enormous pressure to manage costs and improve efficiency, and this has often played out in clients exerting more control on the staffing and processes of outside counsel. It's a buyer's market. Corporations are putting more work out for bid. Requests for proposals are on the rise, as are alternative fee arrangements (AFAs), such as fixed fee billing. In a recent survey conducted by Thomson Reuters, 88 percent of firms said AFAs are here to stay.
It's a new world for large firms, and those that have good project management processes in place and good awareness of what they know, what they've done and how they did it, are in a much better position to prosper in today's tough marketplace. The self-awareness of these firms will allow them to better understand their costs and thresholds, and that means they can establish more predictable pricing that will deliver satisfactory client outcomes while producing a sound bottom line.
Firms are not only expected to explain their billing to the client, but they also must demonstrate that they are delivering significant and measurable value—all while trying to satisfy their own need for growth. Firms are exploring a variety of alternative business models, service models, and technology solutions in order to identify and focus on more profitable work, and leverage efficiency to turn realization rates around. Solutions providers like Thomson Reuters are developing new tools and programs to support transformation and better realization for law firm clients. For instance, earlier this year, Thomson Reuters introduced simplified pricing on WestlawNext to make it easier for users to understand potential client charges and for firms to communicate specific research costs with clients. Firms that have adopted simplified pricing are generating customer charges that are clearer, and are also deriving far more value from their contract.
Firms need better tools, and today's cost recovery solutions are just not enough. Law firm librarians need to drill deeper to investigate billing and analyze research—getting closer to user activity through details around queries performed and documents viewed. Tomorrow's tools, if they are going to be of real service to law firm customers, must help identify better ways to analyze utilization against the firm's legal information contract—by user, practice area, location, and role. These tools must provide greater transparency and granularity—and must be simple to use.
Such a window into research activity will help firms predict future costs, benefiting both the firm and its clients. In the current state of the economy, everyone is trying to spend less and get more for their money. With these demands, legal professionals must have information to help them predict their costs and determine matter by matter if handling a case is right for them.
Addressing the needs of the legal industry
Thomson Reuters is developing a new product for WestlawNext to address the need for powerful analytics that will help law firms better understand how they are conducting legal research in order to better manage it and be more successful. Although the approach will depend entirely on each firm and its clients, the technology and cost recovery solutions will provide opportunities for every firm to be more efficient and potentially recover more of its online legal research costs.
Westlaw Analytics responds to the need for a modernized reporting environment that helps firms better understand their legal research trends and integrate those understandings flexibly into their evolving client billing strategies. The new solution will have sophisticated customer analytics tools and will provide a modern predictive analytics environment to support effective client billing.
At launch, Westlaw Analytics will allow greater transparency into the firm's Westlaw usage than has ever been available to law librarians before. The tool will allow easy navigation through all the details of every research session. Now when a librarian or practice area lead is trying to better understand a Westlaw charge, he or she can look up details of the research session in question, including queries performed, documents viewed, and actions taken.
For example, Westlaw Analytics' billing investigation functionality will allow firms to perform detailed research on user activity and associated costs to support client billing inquiries, searchable by time frame, client ID, user, or location. From inside the tool, administrators can customize the WestlawNext sign-on experience to allow additional options to capture data that informs the reporting detail. For instance, a research session could be tagged non-billable because it was supporting a pro bono matter. Data from the Elite financial management system can also be integrated into the analytics, and all of these attributes will appear during the billing investigation.
Greater visibility to each user and session will give associates a better understanding of how they are doing their research. By giving a more granular report of the data being used, law librarians, for instance, will be able to hone in on their training for future associates, see if associates are researching outside of the firm's subscriptions, and find patterns in research that would otherwise go undiscovered.
The comprehensive information in Westlaw Analytics will be analyzed and available in a data format to allow associates to use predictability to determine the workload of future cases. This information is valuable for both associates and clients. For instance, an administrator could look for trends in research management across multiple matters to help the firm better budget for projects or manage an AFA proposal.
A menu dedicated to notifications allows law firm librarians and practice leads to set alerts for client or user activities to help proactively manage researchers and better align with client expectations. At launch, there will be simple alerts for out-of-plan usage that will be sent via e-mail. Threshold-based alerting, client-specific alerting, alerting based on role or practice area targets, and deviation from benchmarks will be available in future releases.
And did we mention that it's simple?
The simplicity of Westlaw Analytics and the intuitiveness of the user interface belie the searching, sorting, and organizational power that make up the product's nervous system. Librarians and practice group leads will easily move from trends and charts to rich details associated with a research session or a particular client, matter, or user. Moreover, Westlaw Analytics will be an important proof point for Thomson Reuters' strategy of integrating its solutions to support the workflow and efficiency of its customers.
We now know that the new normal is a reality to adapt to more than it is a period of time to endure. Westlaw Analytics is a new mirror to help customers see and understand themselves and their work in powerful new ways to help them meet the changing marketplace head-on—and grow. And it's also a set of measurement tools that will offer law firm customers an entirely new set of metrics to help them manage and lead.
Westlaw Analytics has been in beta testing during 2012, with full launch in early 2013.
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