Competing on intelligence: finding your firm's competitive edge.

• Author: Fuller, Patrick

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April is a great month for sports fans. It begins with the NCAA Final Four, followed by the start of the Major League Baseball season, the NCAA Frozen Four, the start of the NBA and NHL playoffs, and finally ends with the NFL Draft. April also marks the month where statistical analysis and intelligence may have the greatest impact on both the on-field and financial success of professional teams.

Peter Drucker's famous quote--"If you can't measure it, you can't manage it"--has slowly evolved into a "Moneyball" strategy that is now employed in various degrees by virtually every professional sports team.

Therefore, it is not surprising that the legal profession--which throughout the past 10 years has seen the collective revenue of the AmLaw 200 rise nearly 80 percent to roughly $90 billion--is now driving strategy with intelligence and analytics. But while the overall revenue is rising, the share of that revenue that is going to the "bottom 150" (numbers 51-200) of the AmLaw 200 continues to decline, from 48 percent of the total revenue in 2003 to slightly more than 42 percent in 2012. This means that 75 percent of the AmLaw 200 is getting a decreasing share of an increasing market, which creates the most complex of competitive environments.

Throughout the past decade, as technology continued to develop, law firms have been increasingly embracing various forms of intelligence. There are five basic points of intelligence that firms can use to power their strategy, limit exposure to risk and drive revenues: market intelligence, which includes the litigation, deal and IP aggregators; relationship intelligence, which is driven mainly by the relationship strength metrics generated by enterprise and customer relationship management (ERM & CRM) systems; internal intelligence, which primarily consists of experience records and knowledge management; financial intelligence, which consists of both external financial market intelligence and internal profitability analysis; and finally, social intelligence, gleaned chiefly from listening platforms and other social media monitoring programs.

Like a "Five Tool Prospect" in baseball (hits for average and power, speed, defense, arm strength), each of the Five Points of Intelligence are valuable on their own, but when combined with the other points, can be very powerful. Competitive intelligence, commonly referred to as "CI," is often mistaken for both "commoditized information," as well...