Age of uncertainty
Rivers of ink are now spilled over the dramatic changes swiping law firms and their instantly outdated business models; especially but not exclusively BIGlaw. From Susskind’s bellwether treatise to Kowalski’s most recent take on this topic, and everything in between, there’s little doubt anymore that with law firms, business is not as usual. But walking the halls of some clients’ offices, this sense of urgency is not always felt. Practitioners are heads down in the business of law, and the admin side is as busy as ever, making sure that everything else is humming along to enable fee earners do what they do best.
But all of this changes when talking with the firm’s management. Sitting with a group of senior managing or leading partners from both large and mid size firms, as I just did for a day long honest discussion and sharing, and something altogether different is creeping into the conversation; anxiety. As real and as palpable as the stark numbers shared by an analyst from City Private Banking’s Law Firm Group. Where do we start? Expense growth outpacing revenue growth. Demand is slowing down. Productivity gap will put pressure on firms to discount their services even more. AFAs could further squeeze profit margins. And on and on. But like any other industry meeting adversity, so will the legal profession and law firms will struggle and then find their footings. It’ll be different when the dust settles. But legal services will continue to be consumed, including high end “bet the farm”, as well as low-end commodity work.
The format will likely change, none legal entities will get into the business (through changes to ownership rules), and engagements will be managed with more rigor and transparency. Generally, law firms will realize similar to and will therefore learn from management consulting firms and their own beaten path in the past 30 years. But along the way, the next 10 years will introduce a great deal of uncertainty. It’s a tough but necessary proposition; law firms will try and figure out a winning strategy while dealing with changing conditions in the market. But to come up with a winning formula, just like doing so in the lab, it requires a process of trial and error. This strange concept (for law firms) will mean a sea of change for those of us who support the firm’s business. Not the least those of us who are concerned with information and knowledge management solutions.
For our efforts will need to both support, and in some cases, facilitate the change which is already taking hold in many firms. Experimentation and the resulting changes to the firm’s business model will require CIOs, KM directors, practice support personel, marketing, business development and other related functions to respond with speed and flexibility that we’ve never experienced before. And the automation, efficiency, collaboration and media platforms we will choose, will also need to reflect this new reality.
More on this topic, and what specifically it looks like, in a future post.