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Balancing The IT Demand and Supply Equation In Law Firms

September 29, 2014

It seems to be just about every other week a report is published claiming that “IT is a barrier to success”. It’s easy to take these assertions with a pinch of salt as the reports frequently originate from providers who offer a product or service that will quickly and painlessly dismantle this barrier so opening the road to success and prosperity.

However, I spend much of my time speaking and listening to business leaders in the mid market sector and these “barrier to success” stories do appear to reflect the experiences of many.

Demand Versus Supply

If IT is proving to be an obstacle then it seems that this must stem largely from their inability to meet the demands placed on them – either as a result of too little capacity or a shortage of key skills.

 Supply

Let’s look at a typical mid-market organisation, a fictitious law firm that turns over £20M with around 300 staff and four locations.

What is their typical IT staffing headcount (the supply side of the equation)? A recent survey by Gartner suggested that a professional services organisation will typically spend 4.2% of turnover on IT – that gives an IT budget in this firm of £840K. A similar Gartner survey suggested that around 38% of IT spend is on salaries – that is c£320K on IT staff costs.

How many staff will £320K p.a. buy? Of course that is largely dependent on location. So using Edinburgh as an example, I suggest that a server administrator will cost in the region of £45K p.a. (incl. benefits, NI etc.), an IT Manager/Director may cost around £70/80K p.a. and a Help Desk analyst around £25K.

A rough estimate, perhaps 8 or 9 IT staff.

Demand

Now let’s look at what is expected of the 8 or 9 staff – the demand side.

Managing the ‘Run’ side gets more and more difficult every day. While managing the servers, storage and communications requires specialist skills, this challenge is well known and should be manageable with the application of strong service and system management process. Of course it still takes time and resource. Similarly managing the key applications – document management, practice management, email – takes time and effort to monitor capacity, performance etc. as well as maintaining versions and patch levels.

Adding to the traditional operations side, the reach of the technology continues to grow – remote access, access on platforms not owned by IT (BYOD), use of applications not provided by the firm, access to firm’s systems by partners and customers through advanced collaboration tools. Creating stable and secure systems outside of the traditional perimeter of IT control is a new skill that is just being learned.

The Run side of the demand equation is ever increasing as the breadth and complexity of deployed technology grows.

Service Desk takes up effort of course – but how much? Looking across various reports its reasonable to assume our fictitious law firm receives 2.2 calls per month for each user, 660 calls per month – maybe 30 each working day.

What about the ‘Grow’ side of the demand? This is the project work that aims to build new systems and services to meet the new needs of the firm and the market. Well if ‘Run’ is experiencing an increase then ‘Grow’ is feeling the strain to an even greater degree.

The ‘Grow’ portfolio has an unchanging need to upgrade and extend existing key systems. However, ‘the digital world’ is piling expectation upon expectation on the IT department. This pressure is even greater because, seemingly overnight, lawyers have woken up to the fact that IT systems in the digital age will go a long way to decide the winners and losers – and probably within the next three years.

Lawyers now need Martini computing. They need systems and infrastructures that allow them to access any system, at any time, from anywhere in the world and using whatever device they have to hand. Oh and they need data analytics, CRM and social media while you are at it!

Further, when a lawyer sells a service to a corporate customer, collaborative IT systems are part of the service they offer – so it better work!

And speed is king – the opportunities are there for all to see, firms are willing to invest because they can see the prize – but they need this new world now.

Balancing Demand and Supply 

In our example, I would suggest that eight or nine staff just can’t do it! However, IT asking for more cash and/or more staff is not the answer either.

Better, look at the total £840K spend and be more effective at deploying that.

How to get the skills when you need them, handle a growing (and maybe variable) project portfolio, meet an ever-widening skill requirement and do it all faster than ever before?

A modern and effective sourcing strategy is key. At the simplest end – if a third party can manage the server/storage estate for £35K and you need two staff to do it in house then outsource this. If you really only need three days a month of specialist DBA, then using a third party is a no brainer. How to manage the volatile remote environment – again third party niche players can do this for you.

This is not a call for wholesale outsourcing – but a sophisticated and flexible sourcing strategy deploying a range of traditional and niche players is absolutely required.

Next. Cloud computing isn’t an “if” it’s a “when”. For new systems – look at the cloud first. It absolutely has to be faster and cheaper, and it should be more secure with a better quality of service too.

Finally – really hard for lawyers – contracting and governance also has to be fit for purpose rather than overbearing. Balance speed with risk – speed is king after all.

 

 

 

 

 

 

 

 

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