There are ways of telling if you are a market leader. CS Group wanted to be a market leader. IRIS thought they had bought the leader in the legal tech sector – a nice fit alongside their dominance in accountancy practice management. So they looked at the legal market with their market leader specs on, and found it all rather fuzzy…worryingly so.
Then there was a hefty impairment review, increasingly triumphalist scalps claimed by assorted competitors, aggressive new entrants, tortuous upgrade paths, vintage car parks and double brandings; not to mention a succession of inhabitants of the marzipan layer just below Martin Leuw.
So can we now see how IRIS is really progressing as they publish some divisional reports? Videss and Aim are the core of their Law Enterprise brand and combined results into 2010 show a drop in combined sales to £6.4m. Combined profitability for these two legal entities is also down to 5%. This was a pair doing over £10m and 21% only 2 years ago. But this is also the brand designed to make life hard for Lexis (Axxia/Visualfiles), not to mention compete for territory with Tikit/TfB, Thomson’s Elite, a rejuvenated Aderant and creative youngsters like Flosuite.
So can IRIS Law Enterprise claim market leadership here? It seems unlikely. There are all sorts of economic tests for market leadership from complex algorithms about investment capacity to market share charts – but perhaps the simplest is this: if you can put your price up And attract more clients And improve renewals (by volume And value) from existing clients, repeatedly – you are a market leader. (That’s actually the easy bit; knowing what to do with it is the hard bit.)
Even allowing for IRIS accepting some losses of unprofitable clients and fixing what they saw as a £5m reinvestment hole, the results for AIM/Evolution and Videss make hard reading. Senior management in Windsor could well be squinting with arms at full stretch to try to make sense of these in the light of hits or misses on the market leadership tests above. The vagaries of group reporting being what they are, it is entirely possible that they are simply decanting revenues into another group vehicle, so we’ll have to wait and see what the legal division accounts for 2010 come up with. Hopefully the Mountain based Legal Business division within IRIS may be faring better. Alphalaw and Opsis may also be able to bolster divisional performance from their High Street client bases. It is also important to bear in mind that a step back to leap forward is not unknown or uncommon in these trying times. However, we expect highly spun headlines from a group who’s core skill is the simple and usually effective bolting of telesales onto formerly under marketed tech specialists.
Evidence is growing that the attempt to establish a clear market leader in legal technology has required more than CS Group offered, and more than IRIS has been able to fix to date. A market leading position appears as elusive as ever and it is very much still game on for the old brands of TfB, Axxia and Videss, not to mention Aderant, Eclipse and Flosuite – whatever the new covers on the books say.
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