At many law firms, it’s budget time of year. IT and KM managers need to make their best cases for proposed spending.
If your boss asks about ROI, consider showing this: “Superstar Economics” & Laterals: Take II by Adam Smith, Esq. It explains why hiring lateral partners may not pay off. How many COOs or managing partners ask about the ROI of laterals? I’ve seen many firms invest huge sums in laterals (and new offices for that matter) with little assurance of return. In comparison, they shun a modicum of risk on tech or KM. Good analysis and apt analogies, however, may not be good politics!
On a more positive note, proponents of new spending can focus on projects that add to the bottom line and present their ideas as an “investment portfolio” rather than a bunch of costs. In my recent KM – The Right Question post, I proposed a framework for evaluating investment alternatives and suggested focusing on technologies, processes, and staff that add to the firm’s revenue and profits. Examples include social network analysis, business intelligence software, proposal generators, and workforce allocation systems. I’ve reproduced here the sample analysis.
