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.

Georgetown University Center for the Study of the Legal Profession Symposium, Washington, D.C. – Law Firm Evolution: Brave New World or Business As Usual?

I’ll be co-presenting on a panel titled “Rethinking Legal Education and Training” on Monday, March 21 at the Georgetown University Center for the Study of the Legal Profession’s Symposium Law Firm Evolution: Brave New World or Business As Usual? in Washington, D.C.  For information about how to register for this free conference, visit the event registration site.

The lamp and the laser

When you set up a home office, as I’ve recently been doing, you begin to notice lighting in a way you hadn’t before. It quickly becomes apparent that fixed overhead lights and large floor lamps, no matter how bright they might be, don’t illuminate desks and laptops very well. For close-range work, helping you navigate the nooks and crannies of keyboards and file folders, you need more focused lighting — portable, flexible, easily angled, with small super-bright halogen rather than rounded regular bulbs. These light sources are smaller and carry less wattage than the big lights and lamps — but they serve a specific need much better, and many of our illumination needs these days are pretty specific.

I used this analogy — high-wattage lamps that cast vast amounts of light in a wide circle, contrasted with smaller, sharper, focused sources that put only the light you need exactly where you need it — in a recent discussion about the future size of law firms. My theory is that most things being equal, the future belongs to smaller firms and solos, because the large-firm model ultimately suffers from an over-reliance on volume and an inability to finely focus resources. Continue Reading

Solo Practice University guest lecture

After all these years, I’m going back to law school. I’m happy to announce I’m making my first appearance as a Guest Lecturer at Solo Practice University on Tuesday, January 12 at noon ET. After having numerous great conversations with SPU founder Susan Cartier Liebel by phone and email over the years, it’ll be tremendous fun to exchange our ideas with the whole Solo Practice community. Here’s the agenda we’ve prepared — we might not get to all of these topics, but we’ll cover as many as we can:

  1. Why the billable hour’s not dead — just irrelevant.
  2. Why process and systematization will change how legal work is done.
  3. Why “access to justice” no longer has to mean “access to a lawyer'” Will we see the demise of “Unauthorized Practice of Law” restrictions?
  4. How and why client collaboration will affect your practice.
  5. Are we finally ready for preventive lawyering, becoming full-time holistic legal health professionals?
  6. How will the introduction of Brazil, Russia, India, Indonesia and China (BRIIC) into the global legal marketplace affect you and your practice?
  7. Why solos and small firms are the long-term future of the practice of law.
  8. Why law schools won’t change, but legal education will.

All the details of the Guest Lecture can be found at the SPU website. If you’re not currently enrolled at Solo Practice University but would like to access this event, log in to Facebook (or create an account) and become a fan. Hope you can make it next Tuesday!

Update: A recording of the teleseminar is now available by becoming a fan of SPU’s Facebook page here.