Expense Reduction Analysts Success Stories

Expense Reduction Analysts helps Matthew Arnold & Baldwin LLP make significant savings

Matthew Arnold & Baldwin LLP (MAB) is a 30-Partner full service law firm operating from offices in London & Watford. The core sectors serviced by the firm are Banking and Finance, Property Development, High Net Worth individuals and their businesses, Pharmaceuticals and Life Sciences, Professional Services, Retail and Supply Chain and Technology, Media & Telecommunications.

With a turnover of c£20 million MAB is already amongst the largest 200 firms in the UK by fee income; Even more impressively, MAB’s profit per equity partner for 2012/13 places the firm amongst the Top 20.

Like many other law firms, the impact of recession prompted MAB to review operational costs and productivity. As part of this review Finance Director David Abrahams engaged the services of Expense Reduction Analysts (ERA) consultant Jason Adderley in August 2011 to undertake a review of selected expenditure. Jason takes up the story:

“When I was first engaged by MAB it was clear that anticipating a period of significant growth the firm had neither the time nor the resources to quickly interrogate elements of the non-salary overhead themselves. However, the Finance Director recognised that any savings identified could be put back to work winning new business or helping towards the costs of hiring additional revenue-generating staff.”

The first two projects were implemented at the beginning of 2012. On the surface the implementation of a new pricing regime for Office Supplies and Document Storage seemed straightforward, as there was no change of supplier for either item of expenditure.

However, as David Abrahams explains “our longstanding document storage supplier is also a longstanding client of the firm so had to be approached sensitively. Through a thorough collaborative review by all parties of the services used including rescheduling various deliveries and collections and after market testing ERA was able to deliver savings of over 30% without any negative cost of change.”

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“I was highly sceptical of Jason’s claims during our initial meetings, but I am happy to say that his team have managed to consistently outperform my expectations and their specialists know their business.” David Abrahams, Finance Director

David Abrahams, Finance Director

Table of Savings

Category Saving %Office Supplies 42%Postage 8%DX 0%Photocopiers 24%Document Storage 32%Leased Lines 34%

Shortly afterwards, ERA Telecommunications expert Pritesh Patel delivered savings in excess of 30% in the renewal of the Leased Lines contract. Once again the incumbent supplier was retained, but not until Pritesh had successfully fought off a proposed increase in the tariff, and then proceeded to reduce costs by a further third through the tender process.

DX and Postage turned out to be two more tricky assignments. As Jason notes “We were rather blown away by the DX tariff David Abrahams had himself managed to negotiate, so we were able to close that Project quickly and confirm that best value was already being obtained.”

The Postage project proved to be a real challenge, as the best savings could only be obtained with a substantial change in process and migration to a Royal Mail Online Business Account (OBA). “The project started at a convenient time as we were going to have to replace our franking machine. At ERA’s suggestion we tried

OBA over about two months, but it really didn’t work for us at all.” explains David “Managing internal resistance to change was one thing, but more importantly persistent and day-end time-critical problems accessing Royal Mail’s systems caused real issues in getting the post out the door. The general impression was that for us the cost savings didn’t justify the upheaval and risks involved. Although Mike Stevenson at ERA did his best to get the process flowing smoothly eventually our Facilities Manager and Mike agreed the best course of action was to return to our previous practice of using of franked mail. Happily however, Mike was then able to negotiate a significant reduction in the quoted cost of the contract for the machines.”

Meanwhile, in conjunction with the firm’s new Director of Information Systems, Digital Print expert Brian Pinner had moved to review up a Managed Print contract that was coming to the end of its term so that MAB would avoid paying a higher ‘default tariff’ for photocopying

and printing. Following another complex tender and negotiation exercise, including a review of likely and projected requirements for equipment, projected savings over £30,000 per annum were identified with the incumbent supplier – another client of the practice. This was achieved through a combination of change of hardware as well as a review of actual print/copy costs and again achieved through a collaborative approach to the review including the supplier. Finance Director David Abrahams further improved the position by securing a preferential rate for the funding of the new multi-functional devices and printers from the firm’s bankers.

Reviews are about to commence for landlines and mobile telecommunications.

David Abrahams comments “I was highly sceptical of Jason’s claims during our initial meetings, but I am happy to say that his team have managed to consistently outperform my expectations and their specialists know their business. I am also pleased to see that they are capable of offering creative solutions and are not simply focused on cost reduction through supplier negotiation. Having the option to retain our existing suppliers the process has proved to be less risky, intrusive or time consuming than I feared. We’re also saving a significant sum annually, with more to come and during a time of growth and increased overhead consumption this is vital in controlling costs.”

Jason adds “Like most law firms, MAB has been a demanding client – though happily we’re well versed in the some of the challenges we’ve faced, such as suppliers also being clients. In the last eighteen months MAB has also strengthened its FM and IT staff who are working closely with us to further enhance the savings we’ve already identified and embed our methods as part of a sustained cost reduction strategy for the long term benefit of the firm.”

find extra profitwww.expense-reduction.co.uk