The quarterly publication of the International Legal Technology Association
Issue link: https://epubs.iltanet.org/i/11430
Law2020™ The Future Starts Now Indeed, these may become the seeds of success for the firms that will thrive over the next decade. But what is striking is how pervasive passivity is as a response to such challenges — passivity remarkably similar to that exhibited by newspapers facing the eradication of their business model. The Client’s the Thing Those media companies that survived and even thrived through the first decade of this century did so as a consequence of extraordinary attention to both the preferences and needs of their customers. You could argue that the shift in preferences in the newspaper industry was easy to miss because no one understood new media and its emerging users, but in the law business we have customers who are in no way subtle about expressing their preferences. The ACC Value Challenge is tantamount to clients grabbing us by our lapels, shaking us and saying, “Pay attention to us!” It is hard to imagine that in the wake of such ardent lapel grabbing the law business will simply resume its old path. It is very safe to predict that those firms that thrive through the next decade will do so because they pay extraordinary attention to clients’ preferences and needs. Now, most lawyers will respond to such a pronouncement by saying something like, “I already pay attention to my clients’ needs. That’s what I do every day.” And that is doubtless true for most lawyers. But it misses the point of the Value Challenge. Our clients are telling us that we charge too much for the value of the services we deliver. They are asking us, quite pointedly, to rethink how we structure, price and manage our services. The firms that will thrive over the next decade are beginning to understand that request and move in that direction. For example, in the sidebar on page 48, we discuss how some firms are restructuring the delivery of e-discovery services in order to completely revise existing price and effectiveness models. These firms understand that fulfilling client needs means more than just returning phone calls. It can mean changing your business. Institutional Agility and Flexibility The media companies now dominating the media marketplace did not lie back and wait to see what others were doing. Most were extremely aggressive in expanding into online, cable and other new markets both by means of acquisitions and through original creations. They showed great agility in acting on opportunities and great flexibility, especially in terms of how they viewed their core businesses. Those whose view of themselves was defined by what they had always done and who therefore could not adapt with flexibility and agility are now gone, or nearly so. The “horizontal” structure that characterizes law firms can often be an advantage. Individual lawyers themselves can sometimes act with great flexibility and agility. But the challenge to “rethink how we structure, price and manage our services” is an institutional one, the meeting of which will require institutional agility and flexibility. Abundant business school case studies examine how various corporate businesses responded to marketplace challenges with agility and flexibility. It’s safe to say that there are not so many studies concerning law firms. The horizontal structure that proves such an advantage in some circumstances does not lend itself to rapid movements in new directions. Perhaps by 2020, there will be some inspiring and instructional case studies of the firms that have managed to overcome the limitations of horizontal structures and answer the new demands of this decade’s legal marketplace. Of course, there will likely be case studies of the firms that failed to overcome such limitations. Process Improvement and Quality Assurance The newspaper industry and the law business both have elements of the guild about them. Apprenticeship features strongly in their professional development cultures — whether it is the cub reporter becoming a journeyman journalist or the associate becoming a partner, learning is most often accomplished in very small group settings and through close interpersonal relationships. That is an advantage in both settings, and part of the charm of each. Those guild-like working relationships continue into the main of legal practice. Most legal projects have been and continue to be managed through small teams that interact without a lot of what lawyers like to call “corporate” hierarchy. In the environment of the last several decades, such relatively informal working relationships have functioned well. The billable hour certainly adds some cushion to such a work environment, which has been fairly tolerant of inefficiencies. All that changes significantly as legal projects increase in scale and especially when they must be done for a fixed price or in a manner that otherwise shifts considerable risk to the law firm. Inefficiencies become expensive in such a setting. Couple that with increasing demands by clients that firms be able to not just budget but to schedule as well, and law firm work begins to look much more like work in mainstream industry. The ACC’s President, Fred Krebs, is fond of pointing out that many law firm clients have taken project management, process control and quality assurance to a high art. Can you imagine, he asks, building a transport airplane or a skyscraper using the management and pricing approaches of law firms? It is a rhetorical question, though the follow-up question is not: Why can’t law firms adopt the very same controls that their clients use? Adoption of client business management techniques has increased in the legal industry. Some firms are very sophisticated in how they manage, for example, advanced technologies. Law firms now regularly appear in rankings of the top IT organizations in the world. And you can bet that those organizations have taken, say, project management to an advanced state, at least within the IT organization. Peer to Peer the quarterly magazine of ILTA 47