Lately I’ve been thinking about whether law firms value knowledge management and how to measure knowledge management ROI. The underlying concern is that law firms don’t know how to measure and value knowledge management activities. (If you ask most law firm knowledge managers if their firms are doing a good job valuing KM, I suspect you’d receive only negative answers.) And, allied with this is the concern that knowledge managers don’t know how to assist this effort in a meaningful way. We often just throw up our hands and say that it is impossible to measure the ROI on knowledge management. Or, we bury law firm management in an avalanche of useless statistics regarding our activity rather than demonstrating true productivity. And then, we slink back to our corners and feel sorry for our undervalued selves.
Stepping back from that a little, I wondered whether there was a way to separate some basic human tendencies from the economics of law firm life. For example, is it a basic human tendency for all but the most arrogant of us to feel as if we are not properly valued for all the wonderful contributions we make to our organizations (and the world, the universe, etc.)? After all, how many of us actually ever have our egos stroked sufficiently??? If so, how does this color our assessment of our KM contributions? From the perspective of the organization, does the firm even know what it is spending on knowledge management? Does it know what it ought to expect for that investment? And, does the firm know how the lawyers value the results of that investment?
All of this came into sharp focus when I read a report of a recent airline initiative to charge $15 for the first checked suitcase and $25 for the second. Suddenly, the cost/value of having extra clothing and gear options on a trip became very stark. What if we were to charge $150 (or some other amount appropriate for the purposes of this exercise) for the first use by a lawyer of the KM system and $250 (or some other amount) for each subsequent use? Assuming we priced this correctly, and made these personal charges rather than client billable charges, would we then see what value lawyers placed on the KM system?
As long as KM systems are free to users, will those systems always be taken for granted, undervalued, and criticized? Conversely, if these systems are expensive to the user, will we have a better way of judging their true value in the firm’s internal market? Now let’s slink off into our corners and ponder those questions rather than feel sorry for our currently undervalued selves.