Article by Rob Robinson
The Business of eDiscovery in the Summer of 2019
The eDiscovery Business Confidence Survey is a non-scientific 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.
Initiated in January 2016, to date the survey has been administered fifteen times with 1,621 individual responses. The survey is open to legal, business, and information technology professionals operating in the eDiscovery ecosystem and individuals are invited to participate primarily via direct email invitations.
The latest survey was administered in the summer of 2019 and had 173 respondents in roles that included executive leadership (27.2%), operational management (37.6%), and tactical execution (35.3%).
Based on the aggregate results of fifteen past surveys, the following findings and charted overviews of responses to the question of issues impacting business may be helpful in understanding the collective mindset of many industry experts regarding these issues and their impact on the business of eDiscovery.
Eighteen Survey Observations
Observations on Business Conditions (Charts 1-4)
Business Climate (Chart 1 and 2)
- Just under 93% (92.5%) of eDiscovery Business Confidence Survey respondents feel the current business conditions are good or normal in the summer of 2019. This combined confidence level represents a slight decrease in these same feelings when compared to the spring of 2019 where 93.3% felt the conditions were good or normal.
- Slightly more than half of the survey respondents (50.9%) characterized the current business climate as good. This represents a significant increase from 41.1% of respondents who viewed the business climate as good in the spring of 2019. This significant rebound from the lowest rating in this area since the inception of the survey in the spring of 2019 represents a return to strong optimism in the current general business climate for eDiscovery.
- Only 7.5% of respondents classified the current business condition as bad. This represents a slight increase of 0.8% in this area over the last quarter.
- Only 39.9% of survey respondents feel that business climate conditions will be better in six months. This is approximately the same percentage (40.0%) of respondents who in the spring of 2019 felt the business conditions would be better in six months. However, it is the lowest rating in this area since the inception of the survey and may indicate a continued cautiousness about future business conditions.
- The number of survey respondents feeling the business conditions will remain the same in six months dropped slightly to 56.1%. While a slight drop from the spring of 2019, this still is the second-highest rating in this area since the inception of the survey, only trailing last quarter’s 57.8% rating in this area.
- The number of respondents expecting the business climate of eDiscovery to be worse in six months increased quarter over quarter from 2.2% in the spring of 2019 to 4.0% in the summer of 2019.
Revenue Expectations (Chart 3)
- In the summer of 2019, 41.6% of survey respondents feel that revenue in the next sixth months will be higher than today. This percentage is almost the same as feelings on this metric in the winter of 2019 (41.3%) and spring of 2019 (41.7%) and represents the second-lowest rating for this metric since the inception of the survey.
- However, more than half of the survey respondents (51.4%) feel that revenue in the next six months will remain the same. This is the second-highest response rate for this metric since the inception of the survey only trailing last quarter’s 52.2% rating. It is also the third quarter in a row that this response has exceeded 50%.
- The percentage of respondents who feel that revenue in six months will be lower than today increased slightly from 6.1% in the spring of 2019 to 6.9% in the summer of 2019.
Profit Expectations (Chart 4)
- Less than one-third of survey respondents (31.2%) feel that profits will be higher in six months than they are today. This is a decrease from the spring of 2019 when only 34.4% of respondents estimated profits to be higher in six months. However, it is the second-lowest response rate for this metric since the inception of the survey.
- The percentage of respondents feeling that profits will be the same in six months increased slightly quarter over quarter from 55.6% in the spring of 2019 to 57.2% in the summer of 2019. This represents the second-highest response rate for this metric since the inception of the survey.
- The percentage of respondents who feel that profits in six months will be lower than today increased quarter over quarter from 10.0% in the spring of 2019 to 11.6% in the summer of 2019.
Observations on Business Impact Factors (Chart 5)
- In the summer of 2019, 27.2% of respondents viewed increasing 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 eighth time in fifteen surveys that this issue has been rated as the top concern.
- Increasing data volumes continue to be a great concern for eDiscovery professionals with 22.5% of summer survey respondents viewing data volume challenges as potentially having a substantial impact on business in the next six months. This is a slight decrease from the previous quarter when this concern was viewed as the highest concern for potentially impacting business in the next six months.
- The percentage of respondents viewing the impact of increasing types of data as a top business issue increased slightly in the last quarter and is now viewed as the top concern by 20.8% of summer 2019 survey respondents. This is the third quarter in a row this concern has increased and it continues to represent a critical concern for survey participants.
- The impact of a lack of personnel on eDiscovery business performance increased slightly during the last quarter and is the top concern for 12.7% of survey respondents. This is also the third quarter in a row this issue has increased as a concern for survey respondents.
- The percentage of respondents viewing the impact of data security as a top business issue decreased 3.4% from the last quarter and is now viewed as the top concern by 11.6% of survey respondents.
- In the summer of 2019, the impact of inadequate technology as the top business issue decreased 3.1% from the last quarter and is now viewed as the top concern by only 5.2% of survey respondents. This is the lowest rating of this issue as a concern by survey respondents since the inception of the survey and the lowest rating of any concern since the inception of the survey.
(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.
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.
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
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
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
Chart 6: Survey Participant Overview6 -Survey Respondents (Individual and Aggregate Overview)
Chart 7: Survey Participant Level of Support Overview7 – Survey Respondents by Level of Support
Running Listing of Survey Results
- Summer 2019 Survey ( 1 July – 17 July 2019)
- Spring 2019 Survey (1 April – 18 April 2019)
- Winter 2019 Survey (27 December 18 – 10 January 2019)
- Fall 2018 Survey (14 October – 26 October 2018)
- Summer 2018 Survey (4 July – 24 July 2018)
- Spring 2018 Survey (7 April – 20 April 2018)
- Winter 2018 Survey (24 December 17 – 15 January 2018)
- Fall 2017 Survey (5 October – 17 October 2017)
- Summer 2017 Survey (6 July – 31 July 2017)
- Spring 2017 Survey (14 April – 1 May 2017)
- Winter 2017 Survey (20 January – 6 February 2017)
- Fall 2016 Survey (11 October – 1 December 2016)
- Summer 2016 Survey (1 August – 31 August 2016)
- Spring 2016 Survey (1 May – 31 May 2016)
- Winter 2016 Survey (15 February – 29 February 2016)