At the moment there appears to be a constant stream of entrants into the lucrative market for digital dictation workflow software. And each new vendor is offering roughly the same type of solution. As is the case with other solution offerings, the number of vendors will eventually level out leaving two groups of players – the dominant vendors and the innovative vendors.

When we get to this stage any new entrants will be few and far and the main aim for the surviving vendors will be to gain a greater market share.

Also, at this stage – in order to survive – the innovative vendors will bring unique functionality to their solution offerings, in the hope of maintaining their current user base and trying to entice other users to switch solutions.

There can never be too many vendors in a market as far as the user is concerned. It means more choice and greater competition. This market is still in its infancy and competition will lead to innovation. It will be interesting to see what 'other' offerings the vendors will encapsulate into their solutions over time – as there are so many different directions that they can take.

So, realistically, how much money (per seat) should a law firm expect to pay for a digital dictation site licence in the current market? Cost reduction is the key incentive for any law firm and it has to be in a tangible form.

Words like 'efficiency' and 'effectiveness' are bashed about all too often and it is the bottom line figure that really matters to a firm. So, when a solution is replacing a manual process, it should be the same price if not cheaper than its counterpart, in the medium to long term.

A standard dictaphone and a year's supply of tapes would probably cost around £130 and the machine will need to be replaced every year. Therefore, a firm should expect to pay roughly the same amount per seat for a digital dictation system.

Beyond the actual cost of the licences, that firm has to address the additional costs such as implementation, change management, hardware, back-up and recovery and maintenance. Then there are the 'extras' that firms still looking to buy should consider. In all probability, a firm will also want to invest in extra storage servers, extra bandwidth and some additional back-up/redundancy kit.

The change management costs will be one of the major expenses associated with such a project.

These are essentially the hidden costs. This will include:

(1) The time that will have to be spent on training all the users on the new technology, when in fact they could have been earning fees and generating income. The fee earners will need to learn how to record, profile, send and monitor their dictations; the secretaries will have to learn how to work on the new system; the support staff on understanding; and maintaining the system and the trainers on training themselves.

(2) Another hidden cost will be the time-opportunity overhead. This is the initial loss of efficiency that occurs after training while staff are getting accustomed to the new way of working.

The fee earners and secretaries will be working far more efficiently before the change to a digital dictation system than they will be immediately after their training. IT managers should attempt to quantify and take into account the likely impact of this efficiency loss on the firm's bottom line.

So when is a good time to buy? Is there any advantage to be gained from waiting for vendor consolidation, further price reductions or better technology on the horizon?

As with all technology, these systems take a while to implement and roll-out; they may be supplanted by newer releases by the time most staff get around to using them fully. But bear in mind that when a solution is being implemented it is addressing a specific need at the time.

While you are waiting for better technology or a better price, the needs you identified are not being met – and this may result in additional costs for the practice. Furthermore, it is no means certain how a firm should go about determining 'the right price' or 'the right feature set' at any given time.

Enthusiasts should remember: it is essential to ensure that you are getting digital dictation for the right reasons. In my view, the only valid business case is as follows: you are buying it because analysis has shown that it will undoubtedly reduce your operating costs. You should definitely not buy it just because the firm next door has it or because the IT department wants a new challenge and this is a relatively low cost project.

So if the requirement is there, go for it. It does not make sense waiting for a better price or enhancement. This will always be a continuous cycle.