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Law firms still not doing due diligence

Just heard on the grapevine of a tech deal announcement where once again a law firm has made a purchase without apparently doing the full round of due diligence. OK, it was not a very big deal, but of the 4 serious vendors in the frame, only 2 were contacted – and one of those that was overlooked says their solution would have saved the firm £100 a week. True, some firms waste this much on biscuits each week but nevertheless you do wonder if some IT directors have ever heard of the concept of shopping around – or realised there is a recession on.

13 replies on “Law firms still not doing due diligence”

For want of a better term, on a wider basis, let's call this issue 'Situational Awareness' – the need to be aware of what is going on in the market (what's available and from whom, what deals can be done etc), so that fully informed tactical decisions can be made at the right point in time against a strategic plan, which are of best possible benefit to the firm. At present we are indeed in a recession, so the need is certainly there to make correct and beneficial decisions, though I would argue that even ‘boom’ times are no excuse for poor information or decisions.
Such awareness does take time to achieve and maintain, but unfortunately the recession means that all too many people who would normally be responsible for such awareness and decisions are currently losing their situational awareness due to the fact that they are being forced to restrain from undergoing activities (seminars, meetings, networking, conferences etc) which maintain such knowledge. Some of this is due to the ‘not wanting to be seen on a “jolly”’ factor, and some is because some people are currently forced to focus on internal issues (who to make redundant, how to cut the budget etc) and do not have time to engage on such activities.
I suspect that the short term answer lies in the quality of events and choosing the right ones that have some relevance to the strategic plan, rather than doing all or nothing. I would also consider that peer networking (with valid objectives and subjects, rather than an excuse for a booze up) is probably of more practical relevance than high level ‘marketing’ type of events.
And of course when it comes to due diligence when you are actually going to do things that involve real cash, there really is no excuse for not doing the homework. If lawyers did the same then clients would soon complain if something vital was missed.

perhaps they just dont have the amount of spare time you seem to have

Not everyone buys on price alone even in these times.
Suppliers may be quickly ruled in or out of a selection based on reputation, support , technolgical fit and various other factors.

There are loads of legal blogs and rags out there which cost nothing to subscribe to, and even more in the legal publications space for a small fee. We've seen on this site alone that vendors are watching and are happy to plug their wares so there's simply no excuse for not being informed. And in any selection of software or services, particularly in a law firm where you're likely to get next to no recognition for a good decision and typicallly crucified for a bad one you'd be mad not to take a little extra time to do your homework.

This sounds like the usual sour grapes from an overlooked vendor. I have lost count of the number of times I have been contacted by an aggrieved sales director spinning a line exactly like the one above, whining that they should have been on the shortlist, (more or less politely) suggesting that I am some kind of idiot for not considering them and implying my job will be on the line when the partners find out I've sold them down the river.
This is just the last ditch attempt to sow a bit of FUD and re-open the sales process. It is to be expected and it never works. What is surprising is that they have gone semi-public about it – perhaps a sign of the desperate times in which many vendors are living?
Whilst I have come across a few (usually newly promoted) individuals who are wet behind the ears and know little or nothing about the market for a particular piece of software, most of us have been round the block and can cut to the chase when it comes to drawing up a shortlist of vendors. There is always a good reason why vendor x/y/z wasn't included, for example (all drawn from real conversations I've had in this context):
– We're an international firm and your PMS doesn't do multi-currency (properly or at all), go away and do your research.
– I've had dealings with your organisation in the past (before you joined it) and you let me down badly. If you'd spoken to your colleagues before calling, you'd know that.
– You're known throughout the industry as a bare-faced liar who would say anything to get a deal. Strangely enough I don't trust you as far as I can throw you.
– You claim that you do a better deal for us is based on no information whatsoever. I've already done a detailed financial model and everything you've just said backs up my orginal conclusions. It's nice to be proved right.
– I've used your software and it's crap.
– If you can provide me with a single (comparable) reference site that's currently using the product you are flogging, I'll think again.

No, don't hold back, tell us what you really think about vendors

Okay I will. I also hate vendors who spend months (or years) wasting your time by hounding you for meetings and presentations and generally refusing to accept that you aren't currently in the market for their product.
Then when you do issue a tender that might actually require some effort on their part (rather than buying you a lunch or two) they immediately say “We've had a look and decided we don't want to waste our time bidding for your business.” Grrr, going to have a lie down now…

But how can you do that if you don't even speak to them which I think is what Charles' orginal point is about. You are then basing all your information on heresay rather than fact.

“You are response Mr Stokes?” – that doesn't make sense. Let's try another: “Your response, Mr. Stokes?”.
I agree fully that firms should do their due diligence and not rely simply on heresay (often from other vendors) as otherwise everyone would still be working on the premise that Elite is just for the top 10 law firms and SOS just for the bottom 10.

“simply on heresay” – I like this but do you mean heresy or hearsay, either would be valid, or have you introduced me to a new wordmerge ?

My response?
Even a negative comment regarding a supplier or product demonstrates awareness and, hopefully an informed, opinion. I think that’s part of the point of the original post. You cannot avoid mistakes or make good decisions unless you’re aware of the market, good or bad.
Suppliers do indeed get ruled out for all sorts of reasons, but hopefully there is indeed a reason rather than a just lack of knowledge.
As for ‘overlooked’ vendors, well that’s just part of human nature. No one wants to be ‘Mr Irrelevant’.
Though, as luck and Google would have it, see… http://en.wikipedia.org/wiki/Andy_Stokes
Only when people are aware of you can they form an opinion. And the opinion they form is largely down to execution – of marketing, of responsiveness, of product, of support. To quote the old adage “We’re all as good as our last piece of work”.
And of course, I’m able to say this because I’m perfect… Not!
As for having too much spare time … if that were really the case then I’d join the ranks of the Anonymous Grandma and Spelling Police 🙂

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