IT SOUNDS like a phrase that has been expensively crafted by McKinsey consult-ants or lifted from the pages of Private Eye.

But, however ungainly or open to ridicule, “workflow solutions” are buzzwords at the offices of Reed Elsevier, the professional publisher that is home to The Lancet medical journal and the search engine Lexis Nexis.

Chief executive Sir Crispin Davis sees the phenomenon as a route to winning more spending from law firms and medical institutions, as well as increasing contract-renewal rates.

“Two or three years ago, Lexis Nexis was a legal research company, full stop,” Davis said. “By and large, a typical lawyer would spend half an hour a day using our products. Now it is more like two to three hours. What we have done is expand into much more of his workflow.”

Take for example the fast-talking New York litigator, always on the hunt for business leads. Reed makes sure that the first thing he sees when he arrives at the office in the morning is a list of lawsuits in his area of expertise that have been filed in the past 24 hours, plus the names of the attorney and plaintiff. All he has to do is pick up the phone.

The company estimates it is playing in a $48 billion (£23.6 billion) field for legal “solutions” these days, up from no more than $18 billion for legal research and associated applications in 2004.

The same thing is happening in the medical arena, where doctors in Florida can access patient records online, linked to Reed’s diagnostic platform MD Consult as well as a system that electronically sends drug prescriptions to the pharmacy.

Davis said that the shift, which has taken place in the past 18 months, was “a natural but important evolution from print to online and then from online to workflow solutions”, Where possible, Reed is linking its own online platforms with a firm’s intranet, joining them at the hip. It is no wonder, then, that contract retention has gone up from 88% to 97% in science and is almost as high in legal.

To a certain extent, the shift maps Reuters’ move from selling share quotes and news to more graphical data and research. But Reed has gone even further. For small legal practices, it will more or less run the office, providing administrative software that can track billable hours and keep a diary of court appearances.

The company is adding bells and whistles as it goes. It bought the online court-filing system CourtLink, so that lawyers no longer need to deposit dockets and retrieve them from court via courier.

Davis added: “We spent six months living with lawyers, just watching what they did. And out of that came the conclusion that we were covering only a very small proportion of their needs and that there was a real opportunity to offer more and interlink it.”

His chief rival in legal is Thomson Corporation, which is in the process of buying Reuters. The Dutch information-services and publishing group Wolters Kluwer, Reed’s main competition in science, has been slower to embrace changes.

Davis, who has been in charge of Anglo-Dutch Reed Elsevier since 1999, won plaudits for his £750m programme of internet investment, promised in 2000 just when his rivals were cutting back. Designed to digitise shelf after shelf of dusty journals, the plan was announced six weeks before the dotcom boom turned to bust.

But Davis’s judgment was called into question later when his big strategic acquisition of the education business Harcourt went sour. Reed failed to push the text-book supplier online as quickly as its legal and science operations. Coupled with that, earnings were held back by losses of several school-testing contracts.

But Davis is smiling again. Harcourt’s education assets have been sold, to Houghton Mifflin Riverdeep, resulting in a $4 billion cash return through a share consolidation next month.

Announced days before the credit crunch began in July, there had been some market talk that Houghton or its bankers would try to back out. Regardless, Reed’s agreement proved to be watertight.

Beyond the classroom, Harcourt also bolstered Reed’s healthcare arm. Together with risk management, that is exactly where Davis is hunting for more acquisitions. Reed already owns Seisint, a US data-base of public records used to crack down on credit-card and insurance fraud. The aim is to create a “more cohesive, more sharply focused” portfolio. “We were operating on rather a wide waterfront,” he said.

More radically, the company is undergoing a cost-cutting drive that will unite all the back-office functions of its three operating divisions. Reed is considering further outsourcing of IT and human resources as part of a plan to notch up margins by 100 basis points a year.

A new head of procurement has been brought in to centralise buying, and the group’s data centres will be reduced from 140 to fewer than 40.

“My ultimate vision is that the business units will be purely customer-facing activities – product development, sales and marketing. Everything else will be integrated,” Davis said.

Reed estimates that 15%-20% of income today comes from workflow. In four years’ time, Davis expects workflow to account for 50%, within online revenues that will account for 75% of company earnings overall. Online income has doubled to $4 billion in five years. Those forecasts, plus the promise of a cash return, have buoyed Reed shares during tough times for media stocks. Its shares are up 14% this year, compared with a 5% improvement in the FTSE 100 and a 3% lift at Pearson, the company with which it was most closely paired until Reed sold out of education.

Davis said: “I think shareholders are starting to understand the concept [of workflow solutions] but, understandably, they are saying it’s early days, let’s see how it develops. But we have enough revenue to be confident that this strategy is working. We are starting to get traction but we have got a long way to go.”

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