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    Content Assessment: A Season of Change? Eighteen Observations on eDiscovery Business Confidence in the Fall of 2020

    Information - 90%
    Insight - 90%
    Relevance - 100%
    Objectivity - 100%
    Authority - 95%

    95%

    Excellent

    A short percentage-based assessment of the qualitative benefit of the recent post highlighting observations on eDiscovery business confidence.

    Editor’s Note: The results of the recent Fall 2020 eDiscovery Business Confidence Survey present the continuing impact of COVID constraints on the business of eDiscovery. However, for these pandemic-driven results and their potential impact on the business of eDiscovery to be fully understood, they should be viewed through the contextual lens of the results of all twenty surveys that have been administered to eDiscovery professionals since the inception of the eDiscovery Business Confidence Survey. Initiated in January 2016, the survey has been administered twenty times with 2,272 individual responses.

    The Business of eDiscovery in the Fall of 2020

    The eDiscovery Business Confidence Survey is a nonscientific quarterly survey designed to provide insight into the business confidence level of individuals working in the eDiscovery ecosystem. The survey consists of nine core multiple-choice questions focused on factors related to the creation, delivery, and consumption of eDiscovery products and services. Additionally, the survey contains three optional questions focused on the business operational metrics of days sales outstanding (DSO), monthly recurring revenue (MRR), and revenue distribution across customer bases.

    Specific survey questions include:

    • Which of the following segments best describes your business in eDiscovery?
    • How would you rate the current general business conditions for eDiscovery in your segment?
    • How do you think the business conditions will be in your segment six months from now?
    • How would you guess revenue in your segment of the eDiscovery ecosystem will be six months from now?
    • How would you guess profits in your segment of the eDiscovery ecosystem will be six months from now?
    • Of the six items presented below, what is the issue that you feel will most impact the business of eDiscovery over the next six months?
    • In which geographical region do you primarily conduct eDiscovery-related business?
    • What area best describes your primary function in the conduct of your organization’s eDiscovery-related business?
    • What area best describes your level of support in the conduct of your organization’s eDiscovery-related business?
    • How would you characterize the trajectory of your organization’s Days Sales Outstanding (DSO) during the last quarter?
    • How would you characterize the trajectory of your organization’s Monthly Recurring Revenue (MRR) during the last quarter?
    • Which of the following statements best describes the distribution of your organization’s revenue across your customer base during the last quarter?

    The latest survey was administered in the fall of 2020 and had 83 respondents in roles that included tactical execution (39.8%), executive leadership (34.9%), and operational management (25.3%). Industry segments represented in the survey included law firms (37.3%), software and service providers (25.3%), consultancies (14.5%), corporations (12%), governmental entities (3.6%), media and research professionals (1.2%), and others (6%).

    Based on the aggregate results of twenty past surveys, the following findings and charted overviews of responses to survey questions may help in understanding the collective mindset of many industry experts regarding the business of eDiscovery.

    Eighteen Survey Observations

    Observations on Business Conditions (Charts 1-4)

    Business Climate (Chart 1 and 2)

    • In the fall of 2020, 77.2% of eDiscovery Business Confidence Survey respondents felt the current business conditions are good or normal. This combined confidence level represents a 1.1% increase in these same feelings when compared to the summer of 2020 where 76.0% felt the conditions were good or normal.
    • Exactly 38.6% of survey respondents characterized the current business climate as good. This represents a decrease from 40.0% of respondents who viewed the business climate as good in the summer of 2020. This decrease from the summer of 2020 may represent a cautious concern in the current general business climate for eDiscovery.
    • Only 22.9% of respondents classified the current business condition as bad. This represents a decrease of 1.1% in this area over the last quarter. This is also the third-highest percentage of respondents viewing the current business conditions as bad since the inception of the survey, only trailing percentages in this area seen during the COVID-19 time frame of spring and summer 2020.
    • In the fall of 2020, 48.2% of eDiscovery Business Confidence Survey respondents felt that business climate conditions will be better in six months. This is only 0.2% higher than sentiment in the summer of 2020, where 48.0% of survey respondents felt that the business conditions would be better in six months. This is also the highest percentage since the winter of 2019 when 52%  of respondents felt that business conditions would be better in six months.
    • The number of survey respondents that felt the business conditions will remain the same in six months decreased significantly to 41.0%. This drop from 48.0% in the summer of 2020 represents a cooling of business confidence.
    • The number of respondents expecting the business climate of eDiscovery to be worse in six months increased strongly to 10.8% in the fall of 2020, up 6.8% from the summer of 2020. This percentage of respondents who felt the business climate will be worse in six months appears to portray a COVID concern regarding business confidence.

    Revenue Expectations (Chart 3)

    • In the fall of 2020, 42.2% of survey respondents felt that revenue in the next sixth months will be higher than today. This percentage is slightly higher than sentiment on this metric in the summer of 2020 (41.0%) and represents cautious optimism.
    • Under half of the survey respondents (44.6%) felt that revenue in the next six months would not change. This represents a slight decrease of 2.4% quarter over quarter from 47.0% in the summer of 2020.
    • The percentage of respondents who felt that revenue in six months will be lower than today increased from 12.0% in the summer of 2020 to 13.3% in the fall of 2020. A slight increase from last quarter, this percentage is the second-highest percentage of respondents who felt this sentiment in this area since the inception of the survey.

    Profit Expectations (Chart 4)

    • More than one-third of survey respondents (36.1%) felt that profits will be higher in six months than they are today. This is a slight increase from the summer of 2020 when 35.0% of respondents estimated profits to be higher in six months.
    • The percentage of respondents who felt that profits will be the same in six months decreased slightly quarter over quarter from 48.0% in the summer of 2020 to 47% in the fall of 2020.
    • The percentage of respondents who felt that profits in six months will be lower than today remained almost the same quarter over quarter, with 16.9% expressing this sentiment in the fall of 2020, as opposed to 17.0% in the summer of 2020. However, this percentage is among the highest percentage of respondents with this sentiment in this area since the inception of the survey.

    Observations on Business Impact Factors (Chart 5)

    • In the fall of 2020, 49.4% of respondents viewed budgetary constraints as potentially having the greatest business impact on their business in the next six months. This percentage is the highest of all concerns represented in the survey and also is the third-highest rating for any business performance concern since the inception of the survey. It also should be noted that the three highest ratings of budgetary constraints as a primary concern for survey respondents have all occurred during the current COVID-19 pandemic, beginning with the spring 2020 survey. This is also the twelfth time in twenty surveys that the issue of budgetary constraints has been the top concern or tied for the top concern by survey respondents.
    • The percentage of respondents that viewed increasing types of data as a top business concern increased strongly in the last quarter from 14% in the summer of 2020 to 18.1% in the fall of 2020. This is a continuing increase from spring 2020 which had the lowest rating in this category (8.1%) since the inception of the survey.
    • Increasing data volumes continue to be a consistent concern for eDiscovery professionals with 12% of fall survey respondents viewing data volume challenges as potentially having a substantial impact on business in the next six months. However, the level of respondent concern in this area is the lowest since the inception of the survey.
    • The impact of a lack of personnel on eDiscovery business performance decreased during the last quarter and is the top concern for 8.4% of respondents, up from 6% in the summer of 2020.
    • The percentage of respondents viewing the impact of data security as a top business issue increased slightly from the last quarter and is now viewed as the top concern by 7.2% of survey respondents. The level of respondent concern in this area is also the second-lowest rating in this area since the inception of the survey.
    • In the fall of 2020, the impact of inadequate technology as the top business issue increased by 1.8% from the last quarter and is now viewed as the top concern by 4.8% of survey respondents. This is the lowest rating of any business performance impact concern in the fall 2020 survey. It is also is the eighteenth time in twenty surveys that the impact of inadequate technology has been rated as the lowest area of business performance concern by survey respondents.

    Survey Charts

    (Charts Can Be Expanded for Detailed Viewing)

    Chart 1: How would you rate the current general business conditions for eDiscovery in your segment?
    Subjective feeling of business performance when compared with business expectations.

    1 – General Climate Overview – Fall 2020

    Chart 2: How do you think the business conditions will be in your segment six months from now?
    Subjective feeling of business performance when compared with business expectations.

    2 – General Climate Overview + Six Months – Fall 2020

    Chart 3: How would you guess revenue in your segment of the eDiscovery ecosystem will be six months from now? Revenue is income generated from eDiscovery-related business activities.

    3 – Revenue Overview + Six Months – Fall 2020

    Chart 4: How would you guess profits in your segment of the eDiscovery ecosystem will be six months from now? Profit is the amount of income remaining after accounting for all expenses, debts, additional revenue streams, and operating costs.

    4 – Profits Overview + Six Months – Fall 2020

    Chart 5: An Aggregate Overview of Issues Impacting eDiscovery Business Performance Challenges that may directly impact the business performance of your organization.

    5 – Issues Impacting eDiscovery Business Performance – Fall 2020

    Chart 6: Survey Participant Overview

    6 – Survey Respondents – Individual and Aggregate Overview – Fall 2020

    Chart 7: Survey Participant Level of Support Overview

    7 – Survey Respondents by Level of Support – Fall 2020

    Chart 8: Survey Participant Industry Segment Overview

    8 – Survey Respondents by Industry Segment – Fall 2020

    Running Listing of Survey Results

    Additional Reading

    Source: ComplexDiscovery

     

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    ComplexDiscovery is an online publication that highlights cyber, data, and legal discovery insight and intelligence ranging from original research to aggregated news for use by cybersecurity, information governance, and eDiscovery professionals. The highly targeted publication seeks to increase the collective understanding of readers regarding cyber, data, and legal discovery information and issues and to provide an objective resource for considering trends, technologies, and services related to electronically stored information.

    ComplexDiscovery OÜ is a technology marketing firm providing strategic planning and tactical execution expertise in support of cyber, data, and legal discovery organizations. Focused primarily on supporting the ComplexDiscovery publication, the company is registered as a private limited company in the European Union country of Estonia, one of the most digitally advanced countries in the world. The company operates virtually worldwide to deliver marketing consulting and services.