There’s an old, old joke whose punchline is, “I know what you are, my dear, we are now just negotiating price!” If you know this joke* , you recognize it as the quintessential business negotiation: the delta between the price someone will sell for and the price someone is willing to pay. It is the ultimate win-lose negotiation, with each party having to yield to or gain ground from the other.
Thanks to the current economic environment, a new approach to price negotiation is emerging. We call it “Budget-Based Solution Crafting” and it is exactly that. Custom solutions are molded and adapted to fit the realities of the customer’s budget. Rather than a win-lose, yield-gain struggle, the discussion centers around value: best options for the dollars available. It is a very smart approach for limited funds and tight credit.
In Budget-based Solution Crafting, the customer tells the proposed vendor exactly what she has available to spend. The vendor then adapts “regular” services into “custom” services to fit the budgetary restriction. It’s not a new concept, but it is typically not used much in lit support, where services tend to be sold on a fixed, transactional basis (per page, per GB, etc.) and where customers are often comparing commodity services. But while it can be scary to tell a vendor exactly how much you have to spend, it is the single best way to gain a solution that meets your client’s needs
Think of it like buying a wedding gift. You look at the bridal registry and you find a gift that you like, that you already know the bride and groom will like, and that fits your spending budget. No guesswork, no surprises, no haggling. Everybody wins.
The same concept works well for outsourced litigation support services. There are lots and lots of different services you can buy, at many varying price points. Rather than assume apples-to-apples service levels and price points, try putting the price point out first and then understanding what sorts of services (and bundles of services) are available at that level.
Here is a great way to think about Budget-Based Solution Crafting: pretend you are buying a car. Price-first is how we typically buy cars. Typically, a car buyer knows whether they are in the Porsche, Camry or Yugo class. Once they decide the class level, they can evaluate options in that class. Camry or Accord? Sunroof or navigation system? By buying services in this way, the customer is assured of the best value possible for the funds available.
The purchase of outsourced litigation support services lends itself very well to such an approach. Do you really need every document converted to TIF image? Do you really need to host all those non-responsive, irrelevant documents? Do you really need to look at all those duplicates during review? Probably not. So, why pay for them? Or, more importantly, why assume you have to pay for them and thus not select anything which could help? Customizable services can overcome that paralyzing all-or-nothing dynamic.
Quite frankly, your vendor should be your best ally. They should bend over backwards to try to get you what you need at a price you can afford. Like cars, there are lots and lots of options, at all price levels.
So, try it on your next project. Tell your vendor what you realistically have to spend and seek their advice on how best to spend it. You’ll be glad you did.
-Sandy
* If you do not know this joke, please contact me offline. Unfortunately, some of the joke setup is not appropriate for this family-friendly blog forum.
Friday, March 27, 2009
Wednesday, February 25, 2009
Gaining Strength from Automation & Prudent Financial Management
It’s a rough year out there. You probably know someone who’s been laid off or is in danger of it. Maybe that person is you… It’s in uncertain times like these that it pays to be a small, debt-free business. We at Valora are also very fortunate that we rely almost entirely on technology to provision our services. Valora has always tried to be prudent with spending and investment, but even we had no idea that the economy would turn this ugly this quickly. In this environment we find ourselves in a surprisingly strong position against a number of other service providers in our industry. Here’s why:
1. Valora is profitable and has been for over 6 years now. That means that our customers are ensured that we will continue to be around for many years to come. It also means that our employees are ensured of their salaries and their jobs, so they are focused on our business, not on “looking around.” We are happy simply to be doing our jobs and making our customers happy.
2. Valora does not carry debt, so no one is able to make a claim on us. There is nothing like the threat of a looming margin call to put everyone on edge and change corporate priorities. A surprising number of litigation support service providers are highly leveraged, which means they fund their operations on debt. Sometimes the debt was used to finance an acquisition. Sometimes it was used to buy a lot of advertising, marketing and sales presence. And sometimes it is just being used to make payroll. Debt can take the form of a bank loan, a leveraged buyout, venture capital and a host of other instruments. But no matter how you look at it, debt means the money (and the return) ultimately belongs to someone outside the company. And that someone else gets to call the shots. So, even though you may be speaking to your salesperson, account manager or project manager, they are not the ultimate debt-holder and do not have the final say. In some very ugly cases in this industry, the bank has actually become the lien-holder on the business. At Valora the only ones we answer to are our customers – which is just how we like it.
3. Valora has a service focus on automation, which is inherently low-cost and efficiency-driving. Valora’s competitive advantage is our technology and service provision, specifically our ability to automatically perform population analysis, unitization, coding, smart ESI processing, and review. Our “tagging” technology automatically captures all kinds of relevant information: bibliographic (dates, subject lines, authors/recipients), content (names mentioned, key words, issues, concepts) and categorical (duplicates, near duplicates, email topic groups, privilege, responsiveness). Because we are using automation to perform these tasks, the cost is low and the turnaround is quick. Low cost and immediate results are very important requirements in tight economic times. In fact, cost concerns are beginning to eclipse all other service requirements. Fortunately, with automation, you can easily get to “fast and cheap” without having to sacrifice quality or flexibility.
It is generally accepted that legal services go through the following progression over time: first senior attorneys perform the work, and then train more junior attorneys to perform the work at lower cost to the clients. Next, the work shifts to paralegals and other in-house labor. Then contract laborers perform the work, first onsite, then offsite, and then offshore. The final step is to create software programs that can perform the work more efficiently than any type of human labor at all. We have seen this progression in copying, coding and now in ESI and document review. In fact, the latter two are happening so fast, in large part due to economic pressures for low cost and high speed, that the outsource/offshore steps are being skipped completely. Instead, most firms are jumping straight from performing the work themselves to letting automation do the trick. If software can do the work for 2% of the manual cost and 10,000 times faster, why not? The more we feel the economic pinch, the more automation becomes a necessity.
This last point is indicative of the changes going on in the much broader economy as well. Businesses everywhere are looking to leverage technology to replace variable costs. In fact, a big piece of President Obama’s stimulus package is aimed at moving targeted industry sectors to finally embrace technology as an essential tool for operations.
Unusual times call for unusual measures. Give automation a try and see what you get. You might simultaneously be your client’s hero and save your job!
-Sandy
1. Valora is profitable and has been for over 6 years now. That means that our customers are ensured that we will continue to be around for many years to come. It also means that our employees are ensured of their salaries and their jobs, so they are focused on our business, not on “looking around.” We are happy simply to be doing our jobs and making our customers happy.
2. Valora does not carry debt, so no one is able to make a claim on us. There is nothing like the threat of a looming margin call to put everyone on edge and change corporate priorities. A surprising number of litigation support service providers are highly leveraged, which means they fund their operations on debt. Sometimes the debt was used to finance an acquisition. Sometimes it was used to buy a lot of advertising, marketing and sales presence. And sometimes it is just being used to make payroll. Debt can take the form of a bank loan, a leveraged buyout, venture capital and a host of other instruments. But no matter how you look at it, debt means the money (and the return) ultimately belongs to someone outside the company. And that someone else gets to call the shots. So, even though you may be speaking to your salesperson, account manager or project manager, they are not the ultimate debt-holder and do not have the final say. In some very ugly cases in this industry, the bank has actually become the lien-holder on the business. At Valora the only ones we answer to are our customers – which is just how we like it.
3. Valora has a service focus on automation, which is inherently low-cost and efficiency-driving. Valora’s competitive advantage is our technology and service provision, specifically our ability to automatically perform population analysis, unitization, coding, smart ESI processing, and review. Our “tagging” technology automatically captures all kinds of relevant information: bibliographic (dates, subject lines, authors/recipients), content (names mentioned, key words, issues, concepts) and categorical (duplicates, near duplicates, email topic groups, privilege, responsiveness). Because we are using automation to perform these tasks, the cost is low and the turnaround is quick. Low cost and immediate results are very important requirements in tight economic times. In fact, cost concerns are beginning to eclipse all other service requirements. Fortunately, with automation, you can easily get to “fast and cheap” without having to sacrifice quality or flexibility.
It is generally accepted that legal services go through the following progression over time: first senior attorneys perform the work, and then train more junior attorneys to perform the work at lower cost to the clients. Next, the work shifts to paralegals and other in-house labor. Then contract laborers perform the work, first onsite, then offsite, and then offshore. The final step is to create software programs that can perform the work more efficiently than any type of human labor at all. We have seen this progression in copying, coding and now in ESI and document review. In fact, the latter two are happening so fast, in large part due to economic pressures for low cost and high speed, that the outsource/offshore steps are being skipped completely. Instead, most firms are jumping straight from performing the work themselves to letting automation do the trick. If software can do the work for 2% of the manual cost and 10,000 times faster, why not? The more we feel the economic pinch, the more automation becomes a necessity.
This last point is indicative of the changes going on in the much broader economy as well. Businesses everywhere are looking to leverage technology to replace variable costs. In fact, a big piece of President Obama’s stimulus package is aimed at moving targeted industry sectors to finally embrace technology as an essential tool for operations.
Unusual times call for unusual measures. Give automation a try and see what you get. You might simultaneously be your client’s hero and save your job!
-Sandy
Monday, January 26, 2009
Inauguration at 35,000 Feet (aka Of Course, Technology)
I had the distinct pleasure of watching the 2009 Presidential Inauguration from the sky-high view at 35,000 feet, while en route to majestic Denver, CO for a meeting. Thanks to the wonders of modern streaming video technology, I was able to watch and listen to this event in real-time even though I wasn’t even actually on Earth’s surface!
While Obama’s inauguration was certainly inspiring, I was even more impressed with how far we have come in utilizing technology in our daily lives. Of course I was going to witness this, even if I would be traveling at 600 mph in mid-air. In fact, I expected to. After all, I create and adapt technology for a living. Why wouldn’t this be possible?
This “of course technology” attitude is a big part of what lies behind Valora and our push into document and population analytics. We often ask ourselves the same kind of why/why not questions: why would someone just automatically convert an entire electronic document population through to text, metadata and image? Why not figure out first what’s in there and whether anyone even cares about it? Why waste time and money hosting documents that will never be of any consequence? If the answer is, “because we don’t know what’s in them,” then we as an industry have collectively missed the “of course technology” idea completely.
If you had stomach pains and didn’t know why, you would not go to a doctor, have him slice you open in expensive and potentially risky surgery, and then try to figure out what ailed you! You’d be asked a lot of questions and you’d use surgery only as a last resort after rigorous examination and other attempted treatments. Indeed, your health insurance is specifically designed to make you and your doctor act that way! And yet, with litigation populations, we continually cut open the patient in the most expensive and time-consuming way possible, just to learn that 2 aspirin and a call in the morning would have sufficed.
Fortunately, the down economy is helping us, you might say forcing us, to re-think how we work and how we make decisions. Early case assessment, pre-conversion for ESI, population analysis, automated review and more are helping us understand what we have in our document populations and how to use it wisely. We are learning to separate out the useful from the not and to spend our limited resources wisely. For more on how Valora can assist in these area, please see our white papers on Population Analysis, and Automated Review and watch for an extensive article on this topic in this winter’s CASLM newsletter.
Eventually, my flight landed and the painful truth tinged my bright-eyed optimism. Obama’s got a lot of work to do. So do we.
-Sandy
While Obama’s inauguration was certainly inspiring, I was even more impressed with how far we have come in utilizing technology in our daily lives. Of course I was going to witness this, even if I would be traveling at 600 mph in mid-air. In fact, I expected to. After all, I create and adapt technology for a living. Why wouldn’t this be possible?
This “of course technology” attitude is a big part of what lies behind Valora and our push into document and population analytics. We often ask ourselves the same kind of why/why not questions: why would someone just automatically convert an entire electronic document population through to text, metadata and image? Why not figure out first what’s in there and whether anyone even cares about it? Why waste time and money hosting documents that will never be of any consequence? If the answer is, “because we don’t know what’s in them,” then we as an industry have collectively missed the “of course technology” idea completely.
If you had stomach pains and didn’t know why, you would not go to a doctor, have him slice you open in expensive and potentially risky surgery, and then try to figure out what ailed you! You’d be asked a lot of questions and you’d use surgery only as a last resort after rigorous examination and other attempted treatments. Indeed, your health insurance is specifically designed to make you and your doctor act that way! And yet, with litigation populations, we continually cut open the patient in the most expensive and time-consuming way possible, just to learn that 2 aspirin and a call in the morning would have sufficed.
Fortunately, the down economy is helping us, you might say forcing us, to re-think how we work and how we make decisions. Early case assessment, pre-conversion for ESI, population analysis, automated review and more are helping us understand what we have in our document populations and how to use it wisely. We are learning to separate out the useful from the not and to spend our limited resources wisely. For more on how Valora can assist in these area, please see our white papers on Population Analysis, and Automated Review and watch for an extensive article on this topic in this winter’s CASLM newsletter.
Eventually, my flight landed and the painful truth tinged my bright-eyed optimism. Obama’s got a lot of work to do. So do we.
-Sandy
Monday, December 1, 2008
Times Are Changing… and so are we!
Everywhere you look, it seems things are different from just a few weeks ago. New economic realities, new president-elect, and soon a new year. It seems only fitting that Valora is changing, too.
The new Valora takes a decidedly different approach to document processing, namely: why are we doing this and what’s our client’s goal? We specifically try not to process any documents we don’t have to!
It’s a pretty revolutionary idea, and one that is not typically embraced by vendors accustomed to getting paid per document, per page or per GB. But the new economics demand it and new technologies finally make it possible.
We’re embracing the new way of doing business by using some sophisticated analytical capabilities that we’ve built and amassed over the years. Our tools tell us exactly what is inside paper and electronic document populations before we even begin with further conversion. It’s a bit like knowing exactly what’s wrong with you before you visit the doctor, reducing your visit cost to $10, instead of several $100!
I invite you explore the new Valora and learn for yourself how document analysis technologies are changing the face of paper and electronic discovery as we know it. Check out our Resource Center, White Papers, and of course check back here on our blog. We hope to keep you updated regularly with thoughts, dreams and realities of interest to all of you.
Here’s to the future and all that it may bring!
-Sandy
The new Valora takes a decidedly different approach to document processing, namely: why are we doing this and what’s our client’s goal? We specifically try not to process any documents we don’t have to!
It’s a pretty revolutionary idea, and one that is not typically embraced by vendors accustomed to getting paid per document, per page or per GB. But the new economics demand it and new technologies finally make it possible.
We’re embracing the new way of doing business by using some sophisticated analytical capabilities that we’ve built and amassed over the years. Our tools tell us exactly what is inside paper and electronic document populations before we even begin with further conversion. It’s a bit like knowing exactly what’s wrong with you before you visit the doctor, reducing your visit cost to $10, instead of several $100!
I invite you explore the new Valora and learn for yourself how document analysis technologies are changing the face of paper and electronic discovery as we know it. Check out our Resource Center, White Papers, and of course check back here on our blog. We hope to keep you updated regularly with thoughts, dreams and realities of interest to all of you.
Here’s to the future and all that it may bring!
-Sandy
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