Rebundling the law firm

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Perhaps most importantly, unbundling has the immensely positive effect of removing from lawyers our self-imposed burden of omnipotence. Our intense dislike of risk and our fervent striving for control has left us vulnerable to taking on more responsibility for our clients’ outcomes than we often should. The modern view of clients — one they share themselves — emphasizes partnership over patronization, collaboration over command-and-control. Many lawyer-client relationships still fit well within the traditional model; but many more do not, and they need a better option. Limited scope retainers make for a very good start.

That’s a brief excerpt from my foreword to Stephanie Kimbro’s forthcoming book Limited Scope Legal Services: Unbundling and the Self-Help Client, to be published next month by the ABA’s Law Practice Management Section. (With Stephanie’s permission, I’ll post the entire foreword here when the book comes out.) Perhaps needless to add, I support both the theory and practice of limited-scope retainers. Yes, it must be done carefully and yes, there are insurance issues that need to be addressed. But the potential risks of unbundling shouldn’t keep us from doing what we can to help people access its substantial benefits.

Interestingly, though, I’ve recently been thinking about what might be a related concept to unbundling. It came up in a conversation I had with Thomas Prowse, an innovative open-source technology lawyer based here in Ottawa, as we were discussing the imminent dismantling of the traditional law firm. Thomas coined a phrase that I immediately liked: “rebundling.”

Unbundling, Thomas suggested, is not a sign to give up on lawyers and law firms as primary legal service providers. It’s merely the first step in the process, similar to the creative destruction that occurs periodically in the high-tech sector, where the failure of one industry or company provides the conditions needed to foster the emergence of new ones. He also saw a parallel with situations where the internet-enabled disintermediation process led to the emergence of new intermediaries to deal with continuing market complexities (e.g.,  iTunes filling many roles once played by recording companies).

I find “rebundling” a very appealing notion. Unbundling, as I suggested above, requires the lawyer to let go some of the work she has traditionally performed, permitting some flexibility to take hold in the previously rigid definition of law practice. But once you’ve unbundled legal tasks or even entire law practices, what do you do with all the individual elements left lying around? One of the reasons law practices have been such successful entities is that there are real benefits of efficiency and specialization to be gained from integrating related tasks and elements into a single enterprise.

The problem is that these enterprises — law firms — have grown stolid, over-encumbered, and intransigent. The traditional law firm is like one of those old steamer trunks — huge, heavy, unwieldy, often latched with padlocks and difficult to move anywhere, but highly effective at gathering everything you might need and keeping it safely tucked away. The problem, of course, is that hardly anyone uses steamer trunks anymore. We opened them up, unbundled the contents, and for the most part threw them away.

But we didn’t leave our unbundled clothes and toiletries and such lying about individually, or stagger around with everything stuffed into our arms. We rebundled most of it into more portable containers: rollaway suitcases, smaller luggage, carry-on handbags, and so forth. Some items we stopped bringing altogether or trusted others to provide, buying water at the airport or downloading books onto our Kindles. We repackaged our assets into smaller, more flexible cases, some of which could either snap together as a larger unit or function on their own. As travel became more difficult and confining, we adjusted how we traveled.

I don’t want to stretch the analogy beyond its modest capacity, but I do think “rebundling” is a helpful way to think about the challenge that lies ahead for law firms. Doing everything for everyone is a difficult business proposition, but it’s the fundamental basis not just of the full-service law firm, but also of the full-service lawyer. We need to become more flexible and nuanced in how we construct our legal enterprises and carry out our legal projects. We need to make greater use of the construction industry model, where a general contractor gathers individual tradespeople for their skills and disbands the team when the work is done. We need more small boutiques in niche areas to flourish. We need to see the relaunch of the sole practitioner as a 21st-century online mobile entrepreneur. We need fewer steamer trunks and more rollaway carry-ons.

Despite what you may have heard (or what some may think I’ve been saying), the lawyer is not dead and the law firm is not dying. But the time is here to restructure our models, our approaches and our offerings — to start rebundling the law practices that market forces are relentlessly unbundling for us.

Jordan Furlong delivers dynamic and thought-provoking presentations to law firms and legal organizations throughout North America on how to survive and profit from the extraordinary changes underway in the legal services marketplace. He is a partner with Edge International and a senior consultant with Stem Legal Web Enterprises.

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2 Responses to “Rebundling the law firm”

  1. Dan Hull

    Quick and dirty from the American Midwest:

    My firm by accident started “unbundling the cream” to get things done for for certain clients by accident 15 years ago because we needed just one lawyer we did not have:

    (1) an engineer-trial lawyer (2) who knew both the steel industry and construction law principles, (3) had significant European arbitration experience/chops and (4) could deal culturally well with our client, a Rhineland-based German engineering firm building a specialty steel mill for the Spanish in an American southern state under a contract governed by Ohio law.

    So we went out and got such a guy from another firm after a minimum of noises about that firm’s “full service-ness”–a concept which even 15 years ago in the history of this profession was already a straight-up crock.

    The overall idea: In general, for, say, complex litigation, you start with 3 or 4 core people from your own firm (as we did) to service the client. And then you cherry-pick from any boutique or large firm you like with the right talent (it can be a search) that will do it. If the team is right, the borrowed-from firm doesn’t balk and disclosures are made, the client could care less as long as the problem is solved and costs are managed.

    In the above case, the project had 100s of millions of dollars at stake, which the client needed to save or recover in a protracted and expensive trial-type arbitration that went on for years (but was still cheaper than a federal or other court). These kinds of projects are now legion.

    It comes down to project management. You still need brick-and-mortar outfits to pull this off, though. Build your base of the team from one firm. Not easy–but essential to know how to do and wonderful once you hit your stride.

    Nicely done article, sir. Excuse any typos on my end.

  2. Stephanie Kimbro

    Without using the word “rebundling,” this concept discussed above is something that I’ve tried to lay out a process for in my book. I am grateful to Jordan for writing the perfect Foreword to the book and for sharing it with his readers. I think lawyers can look at other industries for great examples of how they have “rebundled” their services to adapt.

    Looking at those examples, here is one of the checklists I included in the book to help law firms walk through how they could add limited scope services as part of restructuring their delivery methods.

    1. What is the true value of the legal services that the firm provides
    to clients? In the services offered, the value to the customer is
    _______________.

    2. What current compromises does the firm make between the quality
    of legal services delivered and the firm’s ability to provide good
    customer service and affordable legal fees? Are there situations
    where the firm could increase customer service and improve communication and affordability without having to compromise on
    the quality of the legal services delivered?

    3. What processes does the firm conduct with the client that could
    be unbundled? Consider more than just the standard handling of
    legal cases for clients and think about a holistic approach to the
    business, such as evaluating other client support or services the
    firm could provide that would make the client’s experience more
    positive.

    4. In any of these processes of interacting with the client, are there
    ways that the operations involving information and tangible data
    might be streamlined either through using technology or re-creating
    new systems of organization and delivery?

    5. To facilitate this, are there any new roles that may need to be created
    within the law firm? How might the firm fill that position or gain the necessary skills, or could part of the process be outsourced?

    6. Would any of these new areas of focus in the business become liabilities instead of assets, and how would the firm prepare for that
    possibility and balance the risk?

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