So many topics, so little time. Did I say that already? But, I can’t wait for this topic for another day! It’s time for the Summer 2020 eDiscovery Business Confidence Survey, published (as always) on Rob Robinson’s terrific Complex Discovery site. So, has the confidence of individuals working in the eDiscovery ecosystem in the business of eDiscovery rebounded from the doldrums from last quarter’s COVID-19 influenced survey results? Let’s see.
As always, Rob provides a complete breakdown of the latest survey results, which you can check out here. I’ve covered every quarterly survey since its inception and, as I’ve done for a couple of years now, I will provide some analysis and I’m continuing to take a look at all surveys conducted to look at trends over time. So, this time, I will look at the results for all nineteen(!) surveys to date, from January 2016 to present (pretty soon, I’m going to need a bigger boat, er, screen). I’m also continuing to look at some of the numbers compared to their averages over all nineteen surveys as additional historical comparison.
It’s worth noting that this is also the second time the survey has been conducted during the current pandemic. Click here for my post on the first time (which was also one of the posts on the inaugural day of this blog).
The Summer 2020 survey response period was initiated on June 26, 2020, and continued until the registration of 100 responses last Friday. This quarter’s survey experienced solid response rates despite being adjusted to a maximum of 100 responders to balance against the recent proliferation of new industry surveys and communications initiated during the current pandemic.
Software and/or Services Providers Back to Leading the Way: After being bumped from the top spot, for only the third time ever, Software and/or Services Provider respondents were back to being the top group with 31% of all respondents (though still over 5% lower than the lifetime average of 36.4%). Law Firm respondents were back to second with 28% of all respondents (over 2% lower than the lifetime average of 30.2%). Consultancy remained third at 22% (which is almost 4% above the 18.3% lifetime average). And Corporation respondents were fourth at 12%, considerably higher than the lifetime average of 7.6%. If you count law firms as providers (they’re technically both providers and consumers), providers account for 81% of total respondents, a similar percentage to the last two surveys. Here’s a graphical representation of the trend over the nineteen surveys to date:
So, how confident is a mostly provider influenced group of respondents in eDiscovery business confidence? See below.
Nearly a Quarter of Respondents Consider Business to Be BAD: And, that’s still better than last quarter’s numbers. This quarter, we saw a 13 point gain to 40% of respondents that considered business to be good, which is still the second lowest number ever. It’s also below the average of all surveys (53.6%) by 13.6%. 36% of respondents consider business to be normal, which is close to the lifetime average of 38.2% and represents a drop of over 5% from last quarter. But, 24% of respondents rated business conditions as bad, which is the second highest percentage ever (though an improvement from last quarter of 7.4%) and still WAY above the lifetime average of 8.3%. Needless to say, COVID-19 continues to reduce business confidence in the industry, at least compared to historical numbers before the pandemic, while at least showing some improvement from last year’s dismal quarter. Here is the trend over the nineteen surveys to date:
So, how do respondents expect COVID-19 to continue to impact business in six months? See below.
Optimism Begins Here: Six months from now is where we’re starting to see some optimism, at least in business confidence (if not in the pandemic itself). Almost all respondents (96%) expect business conditions will be in their segment to be the same or better six months from now, which is nearly 19 percent higher than last quarter. Also, the percentage of those expecting business to be better rose to 48%, which is about 10 percent higher than last quarter. Those expecting worse business conditions dropped over eighteen percent to just 4%. We saw a similar gain on expected revenues with a jump of over 22 percent of respondents that expected the same or better on revenues (up to 88%), with only 12% expecting lower revenues. And, the expectation on lower profits also dropped to 17%, a drop of over eighteen percent from last quarter (while still 5.4% larger than the average (while the higher profit expectation of 35% is only 5.3% lower than the average). So, it appears that optimism is growing for six months down the road. Here is the profits trend over the nineteen surveys to date:
Will the optimistic trend continue next quarter? We’ll see.
An Even Larger Majority of Respondents Identified Budgetary Constraints as the Most Impactful Factor: It’s like seeing Michael Phelps go out and break his own world record! For only the second time ever (and the second time in a row), one of the factors – Budgetary Constraints – was selected by a majority (56%) of the respondents as being most impactful over the next six months, breaking its previous high of 51.2% and 25.7% above average. Increasing Volumes of Data and Increasing Types of Data were tied at a very distant second at 14%, over seven percent and two percent lower than lifetime survey averages of 23.1% and 16.3%, respectively. Data Security was fourth at 7% (which is nearly seven percent below its lifetime average), Lack of Personnel fell from third to fifth at 6% (over six percent lower than its lifetime average of 12.6%) and Inadequate Technology (once again) brought up the rear at 3% (over five percent lower than the lifetime average of 8.4%). Certainly, COVID-19 is continuing to impact a lot of eDiscovery budgets. The graph below illustrates the distribution over the nineteen surveys to date:
It will be interesting to see when we see a return to a more normal distribution. Right now, budget rules all.
Distribution of Respondents is Once Again Reasonably Even: Certainly, we can say that the business confidence sentiments are shared throughout organizations. Tactical Execution respondents were again the top group at 40% (11.4 points over the lifetime average of 28.6%). And, Operational Management respondents and Executive Leadership respondents were tied for second at 30% each (1.8 points over the lifetime average of 31.8% and 9.6 points lower than the lifetime average of 39.6%, respectively). Here’s the breakdown over the nineteen surveys to date:
So, this relativity even distribution continues to illustrate that any impact from COVID-19 is felt throughout the ranks.
Again, Rob has published the results on his site here, which shows responses to additional questions not referenced here. Check them out.
So, what do you think? Is COVID-19 impacting your confidence in the business of eDiscovery? Please share any comments you might have or if you’d like to know more about a particular topic.
Disclaimer: The views represented herein are exclusively the views of the author, and do not necessarily represent the views held by my employer, my partners or my clients. eDiscovery Today is made available solely for educational purposes to provide general information about general eDiscovery principles and not to provide specific legal advice applicable to any particular circumstance. eDiscovery Today should not be used as a substitute for competent legal advice from a lawyer you have retained and who has agreed to represent you.