My good friend and crack wordsmith Michael Clark of EDDix
LLC is striving to break new ground in the world of publishing/distribution,
by charging a pretty penny (>$2,000) for a conventional copy of his new
book covering the landscape of Electronic Data Discovery, but also by distributing
it in pieces across a number of blogs, with each piece free. (See
the EDDix site for the full story.)
Adam Smith, Esq. is pleased to be selected by Michael as a participant,
and fittingly enough given our economic focus we opted for the section
of his book dealing with revenues, margins, and growth strategies. First,
Michael’s piece itself is here.
My take? Beginning at the end, Michael encapsulates growth strategies
nicely. "Go for the low-hanging fruit." ‘Nuff said.
The variance between revenue and margins is of far greater interest. Here’s
how I would visualize it:
As
Michael implies, contrary to the received wisdom, leveraging IP assets
through technology is not the profit driver it’s cracked up
to be, but personalized, human-touch consulting remains the fattest margin
piece of the pie. Why?
- Technology is, at least in EDD-land, a commodity. This is not
quite the famous "IT doesn’t matter" argument, but it’s an argument
that there is no competitive advantage to be found on the technology
frontier. No wonder margins are relatively thin. - People, on the other hand, are a difficult asset to acquire (in the
proper combination of quality and quantity, that is) and a difficult
asset to replicate. This is not just true vis-a-vis one’s competitors
in EDD-land, it’s probably even more true vis-a-vis one’s customers. In
other words, consulting services are the single most difficult piece
of EDD "production" for a client to do for themselves.
Thanks, Michael: Strong, good stuff.
