With almost all marketing associated with eDiscovery, Law Firms, Providers and Software companies alike tout that an advantage of using Acme Company is “Efficiency,” but how are people measuring efficiency? A year ago, at our IPRO Innovations conference, we had a breakout session where we posed the question “Do you know your cost per GB?” Of the 40 or so attendees at that session, not a single person raised their hand. Unfortunately, I don’t think anyone was surprised by that non-reaction. Yet here we are claiming “I am the most efficient person in all the land”.
For those who know me, I am an avid fan of the show Shark Tank. I am always impressed by how well prepared the “Pitchers” are with being able to regurgitate their numbers- cost per unit, cost to ship, if we can get a bigger Purchase Order we can use a manufacturer that will drop the price per unit by $0.32. Why can’t our industry do the same? Do we care? Is the pricing model too convoluted? Is it impossible to calculate all the factors? Project Management, Software, Hardware, Storage, Technicians, to name a few. Everyone states that pricing is a “Race to the Bottom,” so there is more pressure on companies involved with hosting to be as aggressive as possible on pricing.
But if efficiency is truly important and a market differentiator, shouldn’t it be emphasized from the top down? When speaking with Chief Officers, Directors and others involved with the bottom line they are interested in how to become efficient. Experience tells us, that’s where the discussion stops. When a company is looking to evaluate a new solution, tool or workflow, the details are usually handed off to an analyst of some sort to go through a spreadsheet of some “374” line items of features they must test. Rarely in my experience have I seen a spreadsheet like this contain something associated with “efficiency.” More importantly, if the analyst decrees that the solution they are evaluating doesn’t have “27” items they want then that solution is deemed a non-solution. But wait, what if a solution allowed you to gain 32% more efficiency overall and those items deemed as non-starters only pertain to 6% of your projects. Does the 32% efficiency on the 94% outweigh the 6%? Do you have a way to calculate that information? Shouldn’t it be weighed? Does the analyst have any guidance as to how to measure that?
I was talking to a CTO just a few weeks back after Legal Week in New York, and we were both lamenting the perception that our industry is so unique we can’t treat our businesses like others outside our industry. Business is business is business, and if you don’t know your numbers, how can you make decisions on pricing, staffing, ROI, TCO? How do you teach your staff about the importance of efficiency? Data sizes are not going down, but pricing is. Wouldn’t the ultimate goal be to do more with the same? With outsiders starting to take an active interest in the direction of eDiscovery maybe it’s time to start paying attention to more than the top line revenue and EBITDA alone. And for some, how do you get an offer from one of the Sharks?