Media Strategy Service at Stem Legal

Since entering the consultancy world last October, I’ve been (and continue to be) fortunate to work with two great organizations, Edge International (where my focus is on strategic planning for law firms and the rapidly evolving legal marketplace) and Stem Legal (where my focus is on communications, media and social media for law firms). Today, I’m happy to let you know about a new offering we’re rolling out at Stem Legal: a Media Strategy Service. The announcement by Steve Matthews at the Stem blog provides all the details, but in summary, the Media Strategy Service is an intensive three-month project aimed at revitalizing a law firm’s or legal organization’s dealings with the media. Among the services we provide are:

  • a personal interview to establish your media-related business development goals,
  • an interactive questionnaire to determine your best media options,
  • an inventory and assessment of your current media outreach practices,
  • a customized strategic plan for using the media to promote your practice,
  • a guide to building relationships with key media personnel, and
  • a three-month period of telephone and email delivered consultation on media strategy and interaction.

I’m looking forward immensely to delivering assistance through the Media Strategy Service: it combines my dozen years’ experience in legal journalism and communications with my emerging interest in social media for the legal profession. Check out the MSS main page for more details, and please don’t hesitate to drop me a line if you’d like some more information.

The platform is changing

Seth Godin calls it the WordPerfect Axiom, and he’s exactly right: When the platform changes, the leaders change.

WordPerfect had a virtual monopoly on word processing in big firms that used DOS. Then Windows arrived and the folks at WordPerfect didn’t feel the need to hurry in porting themselves to the new platform. They had achieved lock-in after all, and why support Microsoft. In less than a year, they were toast.

When the game machine platform of choice switches from Sony to xBox to Nintendo, etc., the list of bestelling games change and new companies become dominant. When the platform for music shifted from record stores to iTunes, the power shifted too, and many labels were crushed.

Again and again the same rules apply. In fact, they always do. When the platform changes, the deck gets shuffled. …  Insiders become outsiders and new opportunities abound.

This is happening, right now, in the legal services marketplace. The platform for legal service delivery is changing, and if you’re standing on it — and most lawyers are — you’re going to find it very difficult to keep your balance.  The platform used to be the traditional, top-down, hourly-billing, pyramidic law firm, where lawyers set the parameters for where, how, and at what price their services would be made available. Other potential platforms were either underfunded, impractical, or unauthorized. The legal profession as we know it today grew up secure and well-fed on this platform and has flourished as a result. Now, a platform shift is occurring.

We’ve already felt some tremors; now the full-scale quakes are arriving. Howrey LLP is preparing to cut 10% of its partnership after experiencing a 35% drop in equity partner profits. Clifford Chance has changed its governance structure allowing it to do the same thing. A major report from Hildebrandt and Citibank warned that more de-equitizations are coming this year because there’s nothing else left for firms to cut. Respected New York IP boutique Darby & Darby disappeared without warning (and, if you believe the accounts at Above The Law, it went out poorly). Corporate law departments are pulling work back in-house, spending less on outside counsel and turning to alternative fee arrangements. Law firms across the United States are cutting back radically on law student and new lawyer hiring (sample stat: median summer offers per firm dropped from 30 in 2008 to 8 in 2010). And looming over everything is the prospect, now little more than a year away in England & Wales, of full-scale non-lawyer equity ownership of law firms.

We can’t blame this on the recession anymore — what we’re seeing is more fundamental than that. The traditional platform for legal service delivery is giving way, overburdened by its own inefficiencies, inflexibility, and market-unfriendliness. In its place is emerging a new platform — the internet. And on that platform is springing up a multitude of new models by which clients can purchase the legal services they want, whether through virtual or distributed law firms with minimal overhead, advanced software for the completion of simple documents or the facilitation of basic transactions, process-savvy lawyers in other countries or quasi-lawyers in our own jurisdictions, and other platforms yet to emerge that we can’t currently envision. The common thread is client customization: the type, quality, and timeliness of service you want at the price you’re prepared to pay. Law firms will emerge and compete on these bases as well, but they’ll be far from the only game in town.

It’s a revolution, and like all revolutions, the benefits will lag behind the costs. It’s going to be messy and even ugly for awhile — platform shifts are neither neat nor bloodless. Think back to the hassles we all went through with Word-to-WordPerfect conversions while the two programs battled it out. Remember the upheaval in the auto industry as electricity began to shove oil off its fuel platform and the damage that caused to gigantic automakers saddled with suddenly unsellable gas-guzzlers. Think of the carnage in the record and newspaper industries as the internet took away their platforms and rewrote the rules of their games. It may take longer, it may not be as brutal, and it may not generate as much attention in the wider world, but the legal services marketplace is starting to go through something very similar. And there will be casualties.

It’s ironic that Seth chose WordPerfect for his lead example — the legal profession was one of the very last professional groups to abandon WP for the now-ubiquitous Word. Many lawyers to this day insist that WordPerfect was the better program, but when the platform changed for good, even lawyers eventually had to switch. The parallels are close enough to be striking and extremely uncomfortable.

When the platform changes, outsiders replace insiders and opportunities abound. Get ready.

Calendar of events

The next few weeks are booked solid for me, as I prepare for a series of presentations and workshops throughout March. So in exchange for fewer posts over the next month, I thought I’d let you know what I’ll be doing, where I’ll be doing it, and what I recommend you look into doing as well. (Only public events are noted here, of course.)

On March 11, I’ll be in Chicago to deliver a plenary speech and moderate a roundtable discussion for the American Bar Association’s Bar Leadership Institute, an annual gathering of more than 350 new bar leaders from across the United States. The subject of the address will be the rapidly evolving nature of legal practice and its impact on bar associations. I’ll be fortunate to share the stage with two people whose work I admire: Edward Adams, editor and publisher of the ABA Journal, and Carole Silver, executive director of the Center for the Study of the Legal Profession at Georgetown University and a member of the ABA Commission on Ethics 20/20. Here are full details of the event.

On March 18, I’ll be returning to the ABA, but this time by phone. I’ll be co-hosting a webinar on alternative fee arrangements (AFAs) for the ABA’s Law Practice Management Section, along with my Edge International Consulting colleague Rob Millard and Valorem Law Group founding partner Patrick J. Lamb. The webinar, titled “Rethink Legal Billing: Align Your Firm to Alternative Fee Arrangements,” will open with an assessment of what AFAs are and why they’ve suddenly emerged as the hottest topic in lawyer-client relations. The discussion will continue with an in-depth look at the project management and business process engineering aspects of successful AFAs, and close with first-hand experiences with AFAs in real-world situations. Watch the ABA LPM home page for registration information.

And on March 22, I’ll be in Washington, D.C. at the afore-mentioned Center for the Study of the Legal Profession at Georgetown University, which is sponsoring a symposium titled “Law Firm Evolution: Brave New World or Business As Usual?” I’ll be part of a panel discussing new lawyer training methods at some innovative U.S. law firms and contrasting them with Canadian law firms’ articling programs. But the real draw will be the luminaries at the podium throughout the event. Check out this partial list of panellists: Richard Susskind, Stephen Mayson, Dan DiPietro, Bruce MacEwen, Susan Hackett, Leah Cooper, Mark Chandler, Jeff Carr, Aric Press, and managing partners or senior partners from several global law firms. Here’s a downloadable PDF of the agenda.

(Also in Washington, on March 17-18, my colleagues Gerry Riskin and Karen MacKay will be hosting the first of a series of Law Firm Leaders Development Workshops designed to help managing partners and practice group leaders grow their leadership skills and perfect profitability and change management. Highly recommended.)

Finally, although it’s a few months down the road, I’ll also let you know that I’m speaking at the Law Society of Upper Canada’s 5th Annual Solo and Small Firm Conference and Expo in Toronto on May 14. Since I’m appearing there in my dual capacity as an Edge partner and a Stem senior consultant, I’ll speak once on strategic/future of law matters and once on social media opportunities for lawyers.

These sorts of events are always extremely interesting for me — speaking both with other panelists and with attendees is a great opportunity to take the profession’s pulse. If you or your organization would be interested in having me speak or facilitate at an event, by all means please drop me a line or read more about it. And if you’ll be attending any of the foregoing events, please let me know!

Blawg Review at Law Firm Web Strategy Blog

In case you’re interested, I authored this week’s Blawg Review (#252) with my colleagues at Stem Legal’s Law Firm Web Strategy Blog. The theme is technology run amok: the fear many people (and especially lawyers) seem to have about the things we create, as expressed in popular fiction from Frankenstein to Battlestar Galactica. I’ve always thought Frankenstein belonged in the science fiction genre more than in the horror aisle in the bookstore, and this Blawg Review tries to show how an influential strain of sci-fi can trace its lineage back to Mary Shelley’s 1818 novel, while also highlighting the best of the blawgosphere’s last seven days. I hope you enjoy it, and I hope you emulate it — this is my second Blawg Review in the last year, and I strongly encourage more lawyers to take up the BR challenge: it’s important, it’s interesting, and it’s fun.

The new rules of pricing

Recently, I’m told, several GCs and senior lawyers of large law firms gathered in London for a high-level conversation about new billing mechanisms. One noteworthy observation to emerge from the meeting was the law firms’ insistence that whatever new mechanism was developed, it had to take into account chargeable time invested in the work. I wasn’t there to see the clients’ reaction, but if a few eyes were rolled, it wouldn’t surprise me.

Lawyers are going nowhere in this new marketplace unless they can lose this obsession with the effort-based valuation of work. At the heart of lawyers’ billable-hour infatuation, even beyond the attraction of low-risk pricing and the enablement of perfectionism, lies the basic belief that the harder you work, the more you should get paid. “It took me ten hours to do this, so I should be paid twice what another task took five hours to do.” The nature of the work, its relative simplicity or complexity, the knowledge resources it did or didn’t require, and the value or relative lack thereof to the client — all these variables are considered incidental to the effort exerted, the expenditure of the lawyer’s precious time, to accomplish the work.

Very few marketplaces, however, base price directly on effort and time.  Avatar cost 20 times what The Hurt Locker cost to make and took years longer to complete, yet my ticket to watch either Oscar contender costs the same. One real estate agent might make ten times more effort at finding the right buyers for a home than another, yet they both get the same commission upon sale. I can go to a global craft show and buy a beautiful hand-made shawl that an aged, arthritic, Guatemalan woman spent a painful three days to create for less than a family dinner at the local pizza joint will cost that same night. Price differences can emerge from expertise, or from quality, or from brand assurance, or from customer value — but they don’t emerge from how hard someone had to work to make something. Continue Reading

The boutique exodus

I was talking the other day with a partner in a large national firm. For a variety of reasons, including the nature of his practice area, his annual billings have been declining for a couple of years now, and he’s been contacted about it by some of the senior people in the firm. He’s been tempted, from time to time, to respond to their concerns by saying: “Have you ever noticed that every year, you raise my billing rates, and every year, I bill fewer hours?”

That neatly encapsulates what I think is a real and dangerous trend at a lot of the bigger law firms: week by week, rate increase by rate increase, they’re pricing themselves out of the market. The profit imperative is so strong at these firms, and the level of economic sophistication often so low, that rate increases are ordered up regardless of whether the clients want them, can afford them, or are screaming bloody murder about them. To the extent a firm thinks about its clients when raising rates, it often wagers that they have relatively limited options — they need to get the work done and they want it done by lawyers they trust — and that they aren’t prepared to make a radical and onerous move like switching firms (especially since almost all big firms operate the same and bill the same anyway). That gamble has paid off handsomely over the years, and so the firms have had little incentive to change their approach.

What’s happening now, however, is that the clients and their lawyers are teaming up and doing an end run around the firms. There’s been a barrage of reports over the past few months about lawyers abandoning big firms to set up smaller boutique practices, taking clients with them, and thriving in the result. It’s a four-step process: client tells lawyer it can’t afford her rates anymore. Lawyer tells client she doesn’t control her rates and doesn’t want to lose the client. Light bulbs appear simultaneously over their heads. And a few months later, a new small firm is born, with at least one A-list client on its roster. Continue Reading

Law21 2.1

It’s not quite the iPad launch, but for me, it’s still a momentous occasion. If you’re reading this post via an RSS feed, then you might want to click on the originating link, because Law21 has a new look today.

With the indispensable help of Jesse Collins of Moxy Webworks and Tony Delitala of Delitala Design, I’m very proud to show off Law21’s new design. You’ll see that while many features remain the same or similar, you’ll find many more are new and, I hope, interesting. In addition to a cleaner, more open feel to the site, we’ve added these elements:

  • The tabs across the top of the page – which will always stay on top of the page; try scrolling down and see – will bring you to information about the consulting services I’m offering through Edge International and Stem Legal. You can also access this information by clicking the Stem and Edge icons at the top of the right sidebar column.
  • My five most recent Twitter updates are now featured continuously just below those icons, and they’ll constantly refresh whenever I make a new Twitter post. If you want to join the 1,300+ people already following the micro-blogging and micro-publishing service I’m operating on Twitter, a simple click of the Twitter icon will do the job.
  • I’m making a lot more speaking appearances these days, so we’ve installed a feature that tells you where, when, and to whom I’m giving a presentation in the upcoming months. If you’re interested in having me come speak to your firm or organization as well, click on the “Consulting Services” tab at the top of the page for more information.
  • I also thought it was time to provide some links to articles I’ve written and podcasts or teleseminars I’ve recorded. So again, down the right-hand column, you’ll find lists of both types of publications and links to where they can be found online.

As is the case with every blog and website redesign, the form is only a point of entry into the content. So I’ll continue to strive to provide you with the very best articles I can at Law21, to justify and provide real return on the investment of your time and attention here. Thank you, as always, for reading.