"Business intelligence" software? Who could argue with
that? Actually,
it would help to be able to define it first, so particularly if this
is a new jargon-bite to you, the always-insightful and articulate Monica
Bay is a must-read.
It’s easier to describe what BI software seeks to achieve than it is
to tie it up with a pretty definitional ribbon: Properly implemented
(a huge caveat), BI software can bring together data from every
important system in the firm (from time and billing to matter management
to your knowledge management and HR systems) to enable the CFO and the
managing committee to see the profitability of actual or proposed:
- matters
- client relationships
- practice groups
- offices
- associates, and
- partners.
Moreover, BI can tell you how going about things differently might work—for
example, if a client has requested alternative billing, you can create
a scenario that both meets that request and maintains your profit margins.
If you’re already saying this is more than you want to know (in
particular, that last nasty bullet point above), you have just realized
the primary cultural impediment to installing BI.
scope of this blog and best left in the capable hands of others such
as Dennis Kennedy or
Ron Friedmann: Because
a BI installation, a fortiori, requires different systems and
databases to connect and talk with each other, it is not for the faint
of heart, and indeed one AmLaw 100 CIO is quoted as saying flatly that
it’s a "wonderful idea that doesn’t work in the legal world." You
have been warned.]
Technical and cultural impediments to one side, the economist in me
will venture a prediction: As more firms adopt and really use BI
analytics, they will gain a competitive advantage over those who resist. Small
example: BI enabled one firm to assess and approve or deny client
credit-limit increases in a matter of minutes rather than days or weeks.
In
other words, BI is not just for the benefit of the firm; it’s for the
benefit of the clients. We’ve observed before that firms change
when clients demand it. Clients who’ve come to appreciate a BI-enabled
firm are unlikely to settle for less. In other words, the BI handwriting
is on the wall. "First-mover advantage" may yet be obtained, but
the window is closing.
