Three for the money

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Three interesting items in the inbox today, each of which reflects a different facet of the many forces hard at work on producing imminent changes to the profession.

First comes news from the ABA’s Law School Admissions Council that the number of applications to U.S. law schools dropped in 2006 by 7.6%, the second straight annual decrease on top of a sharp deceleration in 2004 in the longstanding trend of rising admissions. The linked article focuses on the drop in both applications and admissions among women, and properly so. But many of the reasons for the decrease cited in the article — stronger economic times, more lucrative non-law career paths, bad publicity about punishing workloads in law firms — cross gender barriers altogether. With the talent wars in full swing, the private bar will not be happy to hear of a potential trend towards smaller graduating classes. I’d be very interested in seeing similar statistics from Canadian law schools.

Secondly, the consultants at Grant Thornton have released their 2007 Professional Services Insights survey, which looks at numerous mid-sized professional firms in fields such as engineering, architecture, and especially law (almost half of all respondents were law firms). The report says professional firms’ fundamental management models will have to change, in light of client consolidation, talent recruitment and retention, and generational cultural changes. “A broader team-based model characterized by a firm-client relationship will need to be adopted by professional services firms, to respond to the broader needs faced by clients and the new career demands of next-generation practitioners,” the press release says. “The report identified a trend toward this type of thinking at architecture and engineering firms, but” — you know where this is going — “less so among law firms.”

The day’s final story contains news of one law firm in Alberta that apparently is ready to adopt and adapt to the dynamics of 21st-century business. The Calgary Herald reports that the law firm of Shea Nerland Calnan is the joint owner of a new tax advisory firm called Moody LLP. The new firm isn’t providing any accounting services, even though most of the employees are CAs — it’s offering purely advisory and tax planning services. “What we see is the mid- to small-sized accounting and legal practices in the province don’t have tax planning departments,” Nerland told the Herald. “There are more and more people in need of those top-end planning services. There’s a lot of opportunity there.” There’s also a lot of opportunity for law firms to make bold strategic moves like this — Moody LLP is the first such jointly owned tax advisory practice in Alberta and only the third in Canada.

There’s a real first-mover advantage available to lawyers and law firms that feel the ground shifting under their feet and reposition themselves accordingly. It’ll be interesting to see who moves fastest and best.

This post originally appeared at Slaw on October 2, 2007.

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