Thursday, May 5, 2011

The Myth and the Madness of Cost Effective Lexis and Westlaw Research Training

An Alternative title to this post might be “Vendor Sourcing: The Digital Edition.” Like the print issues outlined in my post of February 17th, "Vendor Sourcing: Thinking the Unthinkable...", this post will examine how Lexis and Westlaw pricing strategies have shifted substantial administrative burdens onto their law firm customers which not only drive up administrative costs but have a perversely negative impact on the practice of law.

It’s that time of year again. All across the country academic and firm librarians are flocking to “bridge the gap” programs where they engage in their annual “hand wringing ritual” while trying to develop the right formula for preparing associates to perform cost effective online research in the “real world.” Since most law firms have a unique menu of “included” content, unique pricing plans and unique billing policies for the identical content – academic librarians are faced with the impossible challenge of training students for a universe in which there is likely 100% inconsistency in the pricing and billing policies across the firms where they will be summer associates.

Cost Effective Legal Research Training has become the “Bleak House” of every lawyer training program. It is unsustainably complex, groaning under the weight of its unending convolutions and permutations. A "doom loop" of confusion, errors and omissions.

The inspiration for this post occurred while reading the discussion on brain function and "information overload" in Nicholas Carr's bestseller “The Shallows.” The proverbial “light bulb” suddenly lit up in my brain.

I submit for your consideration and debate, the possible truth of the following axioms:

1. Cost effective research training is a hopeless exercise. Think Prometheus - no matter how much you try to develop a set of cost effective rules, there are simply too many price points, too many exceptions to any rule, and too much transience in pricing. New complications will grow back tomorrow. There is no “still point” in this turning world.
2. Cost effective legal research training is counter-productive. Since there are an infinite number of invisible variables and undisclosed price variations, a lawyer attempting to conduct “cost effective” research is distracted from focusing on substantive legal research.
3. Subscribing to the myth of cost effective research training keeps the focus off the true culprits and keeps us from demanding a real solutions.There is probably no other disbursement that confounds and perplexes law firm partners or causes more embarrassment when posted on a client bill than online research charges. Partners blame librarians for providing insufficient research training, librarians blame associates for not absorbing cost effective research parameters, and associates blame their law schools for failing to prepare them to practice in the real world. Let’s all pivot in unison at point at the true culprits: Lexis and Westlaw.

1. Why Cost Effective Online Research Can Not Be Taught

Between them, Lexis and Westlaw have over 100,000 separately priced data files. Each of these 100,000 files has at least 5 different price points associated with it, including: hourly, transactional, cite checking, find and print, document printing, line printing and image printing. Some files have special charges if they generate reports or have an expandable table of contents. Then overlay this toxic brew with the pricing variations generated by “flat rate” contracts which trigger a special discount for some but not all content. This requires an associate to engage in an additional computation to account for a “firm specific” discount off of the undisclosed price points.

Do the Math: We have been expecting associates to be able to predict and control of costs of a system that involves about half a million undisclosed, possible price points.

The Madness Exposed. Handing an associate a Lexis or Westlaw password and asking them to be “cost effective,” is like handing someone a credit card and sending them into a store in which none of the merchandise is priced and then berating them when the bill comes in exceeding your budget. No consumer affairs department would allow a retailer to perpetrate this kind of thing on the public. How is it that almost every law firm in the US has put up with this for the past 3 decades?

2. Why cost effective research training is counter-productive.

The obsession with being “cost effective” distracts the associate from focusing on the real goal -- finding the right answer. Here comes the brain theory. Effective legal research requires deep focus and concentration yet… “the myth of cost effective research” requires an associate to engage half of their attention on a collateral and competing analysis of factors which have nothing to do with the substance of the law. (Am I in hourly or transactional mode? Is this content included or excluded? Should I print or read online? Should I execute a new search or will that cost too much? Have I selected the cheapest file? Is it cheaper to print by the line or print a page  or print a document or should I email the results to myself?)

What about getting a good result for a client? Let me cut to the chase. The truly sinister part of the obsession with “cost effective legal research” training is that it subverts and derails the real purpose of online research: getting to the legal precedents and factual data that impact advocacy for the client. Associates who take the “cost effective gospel” to heart are often paralyzed and confused. They prefer to “Google for precedents” or engage in other outlandish inefficiencies to avoid using the premium research tools altogether.

3. Subscribing to the myth of cost effective research training keeps the focus off the true culprits and keeps us from demanding real solutions.

The bottom line: If Lexis and Westlaw really cared about cost effective legal research they would have developed simplified and transparent billing systems.

I have participated in countless librarian panels and advisory groups sponsored by both Lexis and Westlaw over the past 25 years and we have delivered a consistent demand for simplified and transparent billing systems. Instead of responding to this demand, Lexis and Westlaw have stood back and let us expend countless hours on hopeless training initiatives which were doomed from the start.

Lexis and Westlaw have the power but not the will to make their very complex billing systems open and transparent. When you go to select a file they could display the cost, but they do not. When you are online conducting a research session they could run a ticker showing how much you session has cost, but they do not. They could have a limited number of price points, but they do not.

Killing the Golden Goose.

I do not dispute the there is special value in being able to search databases with the breadth and editorial quality provided by Lexis and Westlaw. An executive at Westlaw recently told me that Westlaw now contains over 2 billion documents, (6 billion if you include public records). It is truly awesome to be able to execute a search across thousands of data sources and get a virtually instantaneous result. I still value the precision and control offered by fielded searching, proximity connectors and Boolean Logic which is not available from the “googlzied” search alternatives.

Premium content combined with premium editorial enhancements is something that clients might be willing to pay for if the costs could be calibrated to value delivered. I do not begrudge Lexis and Westlaw a fair return for their investment, but after 30 years the unchecked expansion in complexity, their billing systems have reached an unsustainable tipping point. They have in effect killed the “golden goose” of cost recovery or at least put it on "life support."

One clearly unintended consequence of escalating costs and complexity has been to expand the ranks of partners and clients who currently refuse to pay for something that if rationally priced would be demanded as a justifiable cost delivering both value and efficiency.

When Lexis and Westlaw deliver simplified and rational billing systems we could actually develop cost effective legal research methods and classes that  could prepare associates to perform cost effective research  while remaining focused on the real goal: delivering the best result to their client.

20 comments:

  1. What a fantastic post. I wish I could add something to this discussion, but I can't because you hit the nail right on the head.

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  2. Wow! This made me think. I do agree that Lexis and Westlaw need to change how they deliver and bill for research. I also think they need to review their pricing in terms of this economy and the fact that a large part of the use of their content, combined with the technology they have in place, should be treated as commodity researching with much lower pricing.

    Still, I have to advocate for cost effective research training. Here, my issue is more how firm leadership in most firms view the need for required cost effective training and what they don't do about it. I think clients would be more willing to pay for online resources if they knew the research being done on their behalf, using those resources, was done with cost in mind.

    Mmmmmm..... I have to think more about this.

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  3. This is great, Jean. You highlight an important difficulty with legal research, which is that it is terribly hard to show the value. Unless you have a catastrophe due to poor legal research, it's probably hard to show that competent research accounted for X% of the client's success (or failure) and translate that into $. I suppose flat-rate subscriptions eliminate the need to do "cost-effective" research, but they encourage the publishers to increase the cost for content you'll never use. As you suggest, we librarians may over-emphasize being cost-effective rather than looking at what we're buying and making it cost-effective before it gets to the researcher.

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  4. Excellet article! couldn't agree more

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  5. Go Jean!!! -- Dark Tower Escapee

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  6. While not a perfect solution by any means to these very legitimate concerns, it seems to me that WestlawNext (and perhaps Lexis Advance) are attempts to change the pricing paradigm that confounds our efforts at being cost-effective and sets up the conflicts you point out.

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  7. Indeed, this is provocative presentation of something that is often on our minds. Now read Mark Gediman's article from vol 14 of the Spectrum (http://www.aallnet.org/main-menu/Publications/spectrum/Archives/Vol-14/pub_sp1003/pub-sp1003-perfect.pdf). There IS a way to make the teaching of cost-effective research less hazardous. There IS a way to make the adminstration of library research costs much easier. Mark offers a very clear outline of how it can be done.

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  8. I agree with anonymous re/the WestlawNext and soon to be released expected pricing model of Lexis Advance being a shift in the right direction for somewhat simplified pricing. Here at my firm I try to encourage our attorneys to not worry greatly about the cost and focus more on getting the answers they need to address their client's legal issues. It helps if a firm's management does not worry greatly about cost recovery, except for the excluded content in the contracts. As a large number of law firm libraries become more virtual, client's refuse to pay,and more firms don't bill for WL and LN, I expect the whole issue of pricing models will become moot.

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  9. Mary Rose StrubbeMay 6, 2011 at 11:58 AM

    Dewey, I agree with one of your stated premises -- that Lexis and Westlaw could make pricing much more transparent, but have chosen not to do so.
    But I disagree with most of the rest of your points, explicit and implied. First, you suggest a false dichotomy -- "cost effective research" versus "thorough and correct/complete research." Second, you imply that all or most lawyers are working at large firms, with librarians. In Illinois, for example, far fewer than 20% of the licensed lawyers work at private firms having more than 25 lawyers. And third, you ignore the fact that any young lawyer trained in a thorough research and writing program in law school should be able to "mix and match" research resources -- to begin investigating the client's matter in the free on-line resources, and to move to the for-fee services only to double-check results and continuing validity of law found.

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  10. Phenomenal post - the goal *should be* to get the best answer to the question within the firm/attorney's time/price limitations. However, with half of the equation hidden (the cost end), it's impossible to get to the desired goal. The best that can be taught is to get to the best legal answer within time constraints. Cost is a black box.

    Lexis/Westlaw love the black box; it promotes finger pointing everywhere but at them. In some ways, they are hiding in plain sight: we see that they're expensive but we BELIEVE them when they say that its our fault that WE are not using them right.

    The only hope is for customers and competitors to hold their feet to the fire. They've successfully cut academics from having any power to convince them, if all academics dropped them, the loss to their income would be about one medium firm: not a lot of sway. Unfortunately, it's up to firms and, I hope, competitors to make them change their business practices.

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  11. All good points, but another thing to remember with both providers--is the fact that when a firm has a flat rate subscription, anything included in that subscription is unlimited. It's the "cost recovery" part that makes it so complicated. If more firms had a flat research charge for their clients or simply increased hourly rates ever so slightly (look for the studies out there on just how small that increase would need to be) the legal research costs would be covered and attorneys could click away, staying focused on the substantive research, not the charges they are incurring.

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  12. But there will never be real pricing transparency, because in a duopoly that leads to a gas war. The last thing Wexis wants is competition on price, and they'll get just that if the customers know what they're paying.

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  13. Actually, Jean, this post sparks so many ideas that I should just go write my own response. That may not happen... so a few quick thoughts here:

    a) A piece on gas wars is here: http://ingrimayne.com/econ/Monopoly/Oligopoly.html
    The brief discussion of entry barriers is particularly interesting, especially as most of the ones that West has relied on for years (high cost of data acquisition, copyrightable citation, high cost of computing infrastructure, "official" status and so-called "authenticity") are eroding.

    b) What can law firms do to promote pricing transparency? Or, more realistically, do we think that widespread leaking of the terms of law-firm contracts with Wexis would promote pricing transparency?

    c) The value of Wexis is increasingly concentrated in (some might say "reduced to") commentary, headnoting, and other value-added features not provided by open-access publishers or lower-cost alternatives such as FastCase. How necessary are they how much of the time? And at the end of the day, is this really just a discussion about caselaw?

    d) Librarians do offer "cost-effective research" courses, but those may be isolated efforts to offset a sort of culture of price-insensitivity that's created elsewhere in their curriculum by other means. Teaching of free or low-fee alternatives to Wexis remains limited. And, perhaps most important, not a lot is said about when it is reasonable to stop researching. If research implicitly teaches that the right answer comes only from exhaustive, comprehensive research no matter the case or the circumstances, then no amount of tweaking is going to help. I'm not sure that there's a practical way to help this, but surely we can communicate to students that there is such a thing as unnecessarily throwing $5000 worth of research at a $500 case.

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  14. Thomas Bruce has uttered the final word : duopoly. What the legal databases market need is com-pe-ti-tion, i.e. new competitors. Not easy : the entry barriers are damn high.

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  15. But the entry barriers are easing. What West should fear most (and I think they do) is the increasing trend toward direct publication in bulk XML. Their longstanding attempt to set up artificial barriers via expansive copyright claims in the apparatus of citation is effectively gone -- though vendor- and media-neutral citation has a long way to go. "Authenticity" regimes that continue the barter surrounding official status are really the last thing to go.

    There will always be competition on value-added features such as commentary, and there should be.

    There is another problem not really addressed here, and that's the somewhat conflicted posture of legal research teaching. Sure, there are sessions on cost-effective legal research. But there is still relatively little emphasis on open-access or low-cost sources in most legal research teaching. And the unspoken assumption behind most instruction is that the only path to the "right" answer is to do research as comprehensively as time allows. Admittedly, there's no really teachable answer to the question, "When have I done enough?" . But, OTOH, very little is said about the value of throwing $5000 worth of research at a $500 case. Cost-sensitivity needs to be baked in from the beginning, not slathered on once the meter begins running for real.

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  16. Your criticisms of wexis price structures and lack of transparency are well-taken and very accurate. However, I don't believe they really make cost-effective training impossible. The real question always needs to be "What IS cost-effective?"

    I submit that it is the strategy most likely to efficiently provide the information needed for a full and complete analysis of the research issue. "Efficiently" means both the cost of the tools used and the cost in terms of the lawyer's time. "Full and complete analysis" means that pretending there is "an answer" is often counter-productive (and inefficient), since the goal posts tend to move--research increases understanding of the issue, which changes the question. To accomplish all of this, a legal researcher needs to learn to think strategically. I teach students that this means 1) developing a background understanding of the issues, generally through secondary sources, before running fact-specific or detailed searches for primary authority; 2) choosing the most appropriate tools for research, based both on each tool's price and each tool's feature set, remembering that an expensive tool may well make the research more time efficient and provide more opportunities for fine-tuning or expanding on results; and 3) choosing strategies for wexis research that tend to limit costs under most price structures--e.g., broad searches supported by focus/locate fine-tuning, and reliance on less expensive tools like citators and digest/headnote links rather than multiple databases searches.

    These and other strategies are far more generalizable than tactics focussed on specific pricing plans--though we should always highlight the importance of knowing the outlines of a particular firm's K--and they have the added advantage of yielding more effective research, too.

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  17. A very interesting post, with many salient points. When I developed and presented my own cost effective legal research classes at my last firm, the emphasis was on using other resources in lieu of Westlaw or LEXIS. Our firm, global in scale, had so many resources that associates and paralegals could use as a less-expensive alternative, and I think many were happy to learn that they didn't have to rely on only these two vendors.

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  18. I'm including cost-effective legal research as a component of my Legal Bibliography class this summer. I disagree with the contention that cost-effective legal research cannot be taught.

    There's an assumption here that all law students will become associates at BigLaw, and will be given free rein in Lexis and Westlaw. Sad to say, many if not most of the students at my law school will go into solo or small firm practice. They will not be able to afford both Lexis and Westlaw-- heck, they'll be lucky if they can afford one. There's a huge difference between eating the cost of massive searches when you're at a multimillion dollar firm, and when you're practicing on your own and your client can't pay the $1000 legal research bill you ran up last week.

    It will be interesting to see how LexisNexis Advance and WestlawNext will change the face of cost-effective legal research. If the duopoly would at least answer pricing questions (yeah right), we could figure out how best to train students. Very frustrating all around!

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  19. I have long suspected the solution is LoisLaw or FastCase, print Digests and ALRs at the County law library, and Westcheck for updating if print Shepard's is too cumbersome. If it's impossible to predict what using Wexis is going to cost you the only thing to recommend is to use them as little as possible.

    LN and Westlaw cost as much as they do because of their added value as information aggregators; used properly, they heavily diminish the value of a Terms & Connectors search after you find the first relevant case. T&C instruction is incredibly important and Wexis is certainly a convenient platform on which to do it, but I can't help but feel doing so tends to send the wrong message about how you're actually supposed to use these things.

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