Law Firm Mergers and KM
The widely reported merger of Wilmer, Cutler & Pickering and Hale & Dorr raises interesting questions about the role technology can play in helping to integrate two firms.
To be sure, merging the tech infrastructure of two firms can be a major challenge. I will leave that topic to others. Even if the infrastructure consolidation proceeds flawlessly, there is still a big question: should a merger prompt adopting knowledge management practices and technology.
The answer is clearly yes, as was well-articulated by Cindy Thurston, Director of Knowledge Development at Shaw Pittman, in a February 2004 article, Knowledge Management and Mergers (PDF) in Capital Connection (a publication of the Capital Chapter of the ALA). Thurston points out that “a key to successful mergers is being able to find the right information or expert quickly.” For this, she suggests good KM and expertise systems are required, as is a serious customer relationship management system.
Of course, I am biased in the direction of firms “doing KM.” I have also for several years now asked (of partners, consultants, and others) why there is so much consolidation among large firms. I do not find the proffered answers convincing, so I was pleased to read a skeptical commentary in the Washington Post today. In Scaling the Myth Of Mergers’ Efficiencies , columnist Steven Pearlstein questions the rationale of mergers.
Synergy does not happen by itself. Cost savings must be carefully engineered. And revenue enhancements through cross-selling take a lot of work. If ever there were a time to demonstrate the return on investment in capturing and sharing documents, identifying and locating experts, and sharing relationship information, it seems that it would be in the two or so years following a major merger.
Added 4/22/04 at 945am: See Law Firm Merger Mania for the transcript of a follow-up discussion to the Pearstein column.
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