JoAnna Forshee, the CEO of Envision, summarises the results of the latest ILTA Technology Purchasing Survey and finds they provide a snapshot of North American law firm IT spending patterns – and who influences them...

In late August, the International Legal Technology Association (ILTA), in cooperation with Envision Agency, released ILTA’s Annual IT Purchasing Survey representing all ILTA member law firms with 100 attorneys or more. While the overwhelming majority of the 126 firm responses originated from the US, information from Canadian, UK and Australian firms was also included. What always amazes is the level of participation and cooperation among the ILTA crowd, especially when it comes time to complete yet another survey. Between periodic ILTA surveys, American Bar Association polls and numerous American Lawyer (AmLaw) rankings and scorecards, law firm IT leaders are constantly on the survey circuit. With that said, a 27% response rate for the ILTA IT survey represents an impressive sampling. The 2007 survey revealed notable findings relating to IT purchasing patterns, budgets, decision making and influences, as well as future technology trends.

The bottom line
Survey responses indicate that budgets are way up, but only among law firms with under 200 attorneys (we called them Small Firms), firms with more than 200 attorneys (Large Firms), on the other hand, are in budget conservation mode. Small Firms are implementing and planning major software purchases, Large Firms are focused on infrastructure, hardware upgrades, and innovative mobility solutions. Small Firm users are dissatisfied with recent technology implementations, perhaps linked to training cuts, while Large Firm user satisfaction more than doubled. Finally, in addition to tackling the e-Discovery boom, IT decision makers are challenged daily with staffing issues, managing firm growth, increasing volumes of data and storage shortages, as well as user education.

Budgets
IT budgets are still increasing, but not for all firms. 52% of Small Firms noted a more than 5% increase of IT budgets compared to 2006 (up 14% from 2006 survey results). 15% of Large Firms reported an overall budget decrease (up 4% from last year’s survey). This “flip flop” trend from 2006 is something worth monitoring in subsequent surveys. Part of the 2007 increased budget trend in Small Firms is attributed to an upswing in more general purchasing plans (15% in 2007 versus 3% in 2006). In contrast, only 37% of all respondents cited specific technology purchasing plans (versus 48% in 2006), and 10% (4% upswing compared to 2006 survey results) cited other reasons such as future firm growth, mergers and acquisitions-related expenses, and business continuity planning. Budget decreases are primarily tied to firms’ expense control and conservative budgeting policies, particularly in Large Firms which accounted for all survey expense-tightening answers. This indicates a notable difference from last year when purse strings at Large Firms seemed considerably looser.

Technology purchases
Small Firms indicated higher implementation rates for case management, courtroom technology, docketing software, imaging/scanning/OCR, patch management, and records management software. Large Firms dominated in the implementation of OS upgrades, remote access technology, voicemail upgrades, workflow automation, and wireless devices. In the planned purchase category, the biggest percentage increases during 2006 occurred in the desktop hardware and laptop/notebook categories (both up 10% from 2006), and in dictation software and hardware (up 9% from combined hardware/software category last year). The biggest declines in the planned purchase category include disaster recovery, workflow automation, records management, cost recovery, and VoIP.

IT & user satisfaction
98% of all respondents (IT staff) were very satisfied (10% higher than in 2006) or at least satisfied with new technologies they implemented in 2006. Comparatively, user satisfaction rates with new technologies fluctuated between Small and Large Firms (Large Firms were 20% more satisfied than Small Firms). In fact, Small Firms indicated a 14% somewhat unsatisfied rate, the only such dissatisfaction among any respondents.

Purchase influences
Less than 50% of survey respondents cited their clients as being key influencers in the IT purchasing process. In fact, only 39% of Large Firms look to clients for IT purchases, a very interesting development.

IT challenges
The most pressing challenges facing the surveyed IT decision makers include managing firm growth from an IT perspective, data volume and data storage limitations, user education and training, and e-discovery readiness/preparedness.

This concludes the summary of the findings, and you can download a free copy of the complete survey.  In addition, ILTA will be hosting the 3rd Annual ILTA Insight Event in the UK. in April of 2008.  If you are interested in attending, please contact Peggy Wechsler at peggy@iltanet.org or Nigel Blackwood at nigel_blackwood@wragge.com

• JoAnna Forshee is CEO of Envision Agency, a legal technology marketing and strategy company representing clients in the US and UK.  She can be reached at jf@envisionagency.com