From the 48th floor library at Milbank, Tweed, Hadley & McCloy‘s New York headquarters, the view is revealing. But it’s not just the outside world — the bridges and buildings of Manhattan — that catches the eye. Within, there is a world that’s changing, too. On first glance, it wouldn’t seem for the better. As part of a renovation last year, Milbank’s library space was cut from 10,000 square feet to 3,200. Many, many books are gone — enough, perhaps, to start a small law school. Even now, on what is otherwise a bustling summer morning, the silence seems a bit eerie. There is no one looking at the books that remain; just a few people standing around computer terminals.

But Alirio Gomez, the librarian-technologist with an MBA, who oversees research at Milbank, couldn’t be happier. “I could get rid of all the books, but a couple of attorneys here still like them,” says Gomez, his shrug an unspoken go figure. “Clients are looking for more efficiencies and more value — added service, and this,” he says, pointing to the giant flat-panel display that has essentially become the new “walking tour” of the library, “is how we provide it.”

In fact, says Gomez, the shrinking space — and at some large firms, including Milbank, the shrinking library staff — isn’t the death knell for the law firm library, but the start of its next, better, technologically advanced phase. Through online hubs like the Milbank Research Portal, lawyers will have fast, fine-tuned access to the resources they need. Librarians will have more control over what sources are used — and what expenses are incurred. Publishers will no longer have all the leverage when negotiating contracts for licensed materials; and, in the end, clients will get better service that’s more cost-efficient, too.

Over the past few years, change has become more than a buzzword among law librarians. It’s become, perhaps, the defining characteristic of the profession. Librarians have seen the nature of their work evolve; many now spend as much time assisting with business development tasks as with traditional legal research. They’ve had to become experts on technology — particularly Web-based delivery methods — and aggressive in negotiating content licensing agreements. And they’ve had to make their case — and often their plea, for resources — to a growing number of nonlawyer administrators who don’t always understand the library’s role, or why it needs to spend so much money.

Each year, The American Lawyer‘s annual survey of law librarians has highlighted both the new and the expanding challenges that law librarians face. But this year’s survey shows something else; librarians are getting a handle on many of these issues. They are leveraging technology and developing strategies to prevail over vendors, budget constraints and that never-ending pressure to watch costs.

All told, the survey reveals a generally happy lot. An overwhelming 85 percent of library directors are satisfied with their job; 78 percent approve of recent decisions firm management has made regarding the library; 77 percent are OK with the new roles played by the library. True, their paychecks may have something to do with the goodwill: 32 percent earn $150,000 or more (and 3 percent earn $300,000 and up). But in the course of more than a dozen interviews, another factor emerged: satisfaction in becoming tougher advocates, savvier negotiators and vital contributors to the firm’s business — and growth.

“Everyone is saying the biggest challenge we face is cost reduction and cost containment, but I think what’s really different now is our opportunity to be part of the revenue stream, rather than a back-office cost,” says Linda Will, director of information resources at Dorsey & Whitney. “We’re taking an active role, for example, in competitive intelligence, and can now calculate our [return on investment], putting dollar amounts not only on what we do, but what we bring in.”

Indeed, competitive intelligence continues to grow as a key focus of the libraries. Fully half of survey respondents said that the library was now their firm’s main resource for developing the information. The nature of this work is changing, too. While much competitive intelligence still consists of research and analysis of clients, potential clients, industries, events and litigation that might be ripe for pitches — “partners don’t want 1,000 pages of printouts, they want us to read it and synthesize it ourselves,” says one library director who declined to be identified — the rise of Web 2.0 technologies has forced librarians to shift gears a bit.

But today’s online world is a two-way street. Lawyers and library staff can, as always, search for and retrieve (or “pull”) the information they need. However, an increasing number of content providers — from fee-based publishers to free blogs — are taking a more proactive approach. Instead of waiting for users to call on them, they’re sending (“pushing”) information directly to the desktop. The delivery methods are numerous, including daily newsletters on a specific topic and e-mail alerts. There’s often a lot of great data — and potential leads — but busy lawyers have little time to sift through it. So, increasingly, law libraries are taking the initiative, becoming, in effect, information gatekeepers, determining what content gets passed along, and how.

Some firms are taking a high-tech approach, developing innovative ways to manage, and leverage, all the content that’s being pushed and pulled. At Sheppard, Mullin, Richter & Hampton‘s library, for example, a librarian versed in Web programming is building an application that, when completed, will be able to collect information on a specific topic, such as climate change, and post it to a page on the firm’s intranet. The idea, says Martin Korn, Sheppard, Mullin’s head librarian, is to take the information that’s being delivered in all those different ways from all those different sources and bring it together in a manner that is easily accessible to lawyers. “People can open a link,” says Korn, “and retrieve content on a topic, industry or company, and then filter it to suit their needs.”

Yet while technology can efficiently sort and deliver content, it’s still a human being that’s in the best position to make sense of it, deciding what’s important enough for a time-challenged attorney to see and what can be discarded. So at many firms, the process of “massaging” data, as the librarians tend to call it, is still very much a manual — and time-consuming — process.

But sometimes there’s a price to pay for the focus on business intelligence: traditional reference tasks don’t get done. “Competitive intelligence is a lot of work, requiring us even to go off-site to academic and other libraries, and the staff will neglect their other stuff,” says a library chief who declined to be identified.

Yet many librarians contend that it’s not the drain on resources that’s the real problem — but the difficulty in getting more resources. “Your reward for being good is more work, but at the same time, it’s hard to get an increase in staff,” says Kate Martin, director of library services at McKenna Long & Aldridge. Some firms have recognized — either on their own or, occasionally, after a telenovela’s worth of drama — the role of the library in developing competitive intelligence. They’ve hired, if not more research librarians, then at least a librarian or two specializing in competitive intelligence.

Meanwhile, many library directors have gotten good at creating metrics, showing just how much time they’re spending on business development tasks. That can help when making the pitch for more staff. But not always. “I know better than to ask,” says one library director who requested anonymity. Adds another: “Whenever IT staff needs new staff, they get it. But there’s always a reluctance to hire more in the library.” According to our survey, 56 percent of the libraries are operating with the same size, or smaller, staff than they did a year ago.

On the surface, that doesn’t seem to make a lot of sense. Libraries are, arguably, doing more important work than ever — work that can result in new business. Yet they often can’t get the staff they need to do this very same work. The reason, perhaps, lies in the org chart. While it may be the library gathering competitive intelligence, it’s often the marketing department handing off the report. In just 21 percent of firms responding to our survey does the competitive intelligence department report to the library. In 38 percent, it reports to the marketing department (in 5 percent, it reports to both, but that’s a whole other set of issues). “It’s hard to make the argument that we need more staff if they see the work coming from marketing and not from us,” says one library director.

Budgets are another touchy subject for the library chiefs. In absolute terms, they’re increasing; 73 percent of respondents said their 2008 budgets were up from 2007. Indeed, average spending increased from $4,251,627 to $5,899,610 (though median spending barely budged, coming in at $3,804,055 in 2008, compared to $3,500,000 in 2007). But much of the added spending is simply to keep up with price increases for content. While LexisNexis costs were down slightly last year — averaging $1,154,860, compared with $1,234,631 in 2006 — Westlaw fees were up markedly, averaging $1,998,674, compared with $1,681,399. And that’s not simply because lawyers spent more time on the service; 85 percent of firms have a flat-rate contract with Westlaw (81 percent have one with LexisNexis). (The American Lawyer‘s parent company has a licensing deal with Westlaw.)

Further straining budgets — as well as patience — are what librarians contend are draconian licensing terms forced on them by some of the smaller, specialized electronic research vendors. Among the less popular policies: licensing a database to 10 specific users, instead of any 10 users, so if a named attorney is out for the day, no one else can use the service in his place by prohibiting use by librarians and forcing the entire firm to subscribe to — and pay for — a service that just 10 lawyers in one practice group need. To be sure, there are signs of improvement. “The publishers that are new to the industry tend to be better, offering simple licensing terms and reasonable pricing,” says Korn. But others, he adds, particularly those that have been around a while, make use difficult and expensive.

Print, it turns out, isn’t easy on the budget, either. Even as libraries shelve fewer books, they’re spending more for them: 76 percent of firms reported spending more on print materials in 2007 then they did in 2006. That’s forced firms to aggressively weed out even more of their paper-bound resources.

One way librarians are leveling the playing field is by leveraging technology to control costs. The thinking: It’s worked for internal costs — Latham & Watkins, for example, directs all requests for research assistance to a single e-mail address, so when it’s the middle of the night in Los Angeles, a librarian in Germany can answer the request, providing, in effect, 24/7 service without paying for 24/7 staff. So why not for external costs?

The research portals that more and more firms are developing can control costs simply by steering preferred vendors to lawyers. Lawyers who see a practice group page listing resources are more apt to use one of those than go hunting for another, possibly more costly one. But a lot of firms are going a step — or more — further. Some strategies are relatively simple. “We’ve considered putting dollar signs next to each source, like in a restaurant review,” says Marcia Burris, library manager at Ogletree, Deakins, Nash, Smoak & Stewart. “The more dollar signs, the higher the cost. So users can decide if it’s worth it.”

Other strategies are more sophisticated. Analytics — an area more and more librarians are looking into, with new and more capable software tools entering the market — can reveal when resources are used, by whom, and for how long. This kind of information can be a powerful bargaining chip when negotiating new usage contracts. “We’ve used analytics to figure out just how expensive a service really is, and we’ll show that to the vendors,” says Milbank’s Gomez. “Often, they’ll then come up with a solution, perhaps giving us a discount or building a better interface to increase usage. Sometimes we’ll just discontinue use.”

Technology also enables Milbank to eliminate duplicate searches — and the duplicate charges that result. The situation: Two lawyers in two offices, working on the same transaction, will each do the same search — say, looking for current news about a deal. The firm gets charged twice. The solution: develop profiles on specific clients and transactions and proactively run the searches — once — with results then available on demand to any user who is logged into the portal. “You no longer have each lawyer doing their own search, duplicating efforts and fees,” says Gomez.

But the librarians’ newfound, tech-driven leverage isn’t the only thing that’s changed the face of contract negotiations. While our interviews turned up the traditional anecdotes of vendor intractability — requiring firms to take a product they don’t want, to get one they do; take-it-or-leave-it prices — they also uncovered something else: These stories, in contrast to years past, now seem to be the exception. Librarians aren’t dreading contract negotiations like they used to, partially because they’re getting better at it, and partly, as McKenna Long’s Kate Martin describes her own recent experience negotiating deals with West and Lexis: “They just seemed hungrier this time, much more willing to negotiate.”

But there’s another factor here, too. Increasingly, library directors are seeking outside help to snag the best possible deal. They’re hiring consultants to do the bargaining. In particular, they’re seeing that take-it-or-leave-it pricing doesn’t always need to be taken or left. “One of the vendors said they simply would not negotiate,” says Martin. (She declined to say which vendor.) “We called in an outside person. He analyzed the contract, got it down — even more than we had [pushed for].”

The downside, say two librarians who declined to be identified, is that working with consultants — who typically are paid a percentage of the savings they obtain — can itself be an unsavory business. “Some of these consultants are like junkyard dogs, very difficult people,” says one library director. But that, she adds, is what makes them good at what they do. There’s something else that makes them effective; by working on multiple deals, they know which firms are getting what — a handy piece of inside baseball, given that these contracts are typically confidential. “They may know that another firm got a better deal, and they’ll give you a sense of what you can and can’t get,” says this librarian. In fact, sometimes just the threat of bringing in a consultant is enough to get some movement on price: “Some vendors will offer you a better deal if you agree not to bring in a third party,” she says. “And if [we] think we’re getting a reasonable offer, we won’t bring them in.”

Now that they’re seeing some success at the bargaining table, the buyer’s remorse librarians used to experience has been replaced by a different kind of regret, namely: What took so long? “I don’t know why we cowered before — we’re the customer,” says Dorsey & Whitney’s Will. “In the last year or two — and certainly in 2008 — we’ve become extremely aggressive.”

But getting tough with vendors is just the first step. In order to do their job well — and get the resources they need — library directors will need to be aggressive advocates within their firms, too. That’s something that’s rarely come easy, but is essential today. “We’re not like marketing, where it’s just in their blood to toot their horn,” says one law firm librarian. “But we can no longer just sit around and wait for the rest of the world to recognize us. Like it or not, we’re in the business world now.”

Alan Cohen is a freelance writer in New York City.

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