Be your own platform

This morning, the Supreme Court of Canada released its long-anticipated decision in Keays v. Honda, a wrongful dismissal case that concerned the extent to which punitive damages should be awarded under Canadian employment law. The plaintiff, who had scored an unprecedented $500,000 in extra damages at trial, saw his notice period cut from 24 to 15 months and his aggravated and punitive damages wiped out altogether. It’s a powerful signal from the country’s highest court that punitive damages are to be reserved for the most outrageous instances of conduct, which the 7-2 majority felt were not present. But that’s not why we’re here.

In the last 24 hours, I’ve received three e-mails and one phone call from lawyers advising me that the SCC decision was imminent and offering to write an article or be interviewed for a piece in National on the judgment. Among other things, these requests are a compliment to our magazine: they demonstrate that lawyers consider National a leading publication with which they would like to be associated — that our brand carries sufficient weight within the profession such that it would be beneficial to their reputations to appear therein. I’m certainly happy about that.

Now, here’s the thing: we’re the wrong publishing vehicle for them to pursue. In practical terms, National publishes just eight times a year, and the issue currently in the editorial process won’t be circulated until mid-August — and even then, this edition’s lineup is already set; the next issue with any degree of lineup flexibility arrives on lawyers’ desks in late September. By the time we publish anything on Keays, months will have passed since the decision was released and it will be the oldest of old news.

Moreover, National covers a wide range of issues, as befits the periodical of a nationwide lawyers’ association, and employment law is not our focus. Employment lawyers seeking to raise their profile should be looking at periodicals specific to this field, especially those to which corporate clients subscribe — that’s the audience these lawyers ought to be trying to reach.

But there’s something more fundamental at work here. Continue Reading

Law schools join the talent war

Northwestern University School of Law garnered a lot of attention last week by announcing a series of curriculum changes, most prominently the creation of an accelerated JD program that would allow students to graduate with a law degree in 24 months, rather than the traditional 36. While Dayton and Southwestern law schools have gone this route before, NU is the first “elite” faculty (ninth in the irrationally important US News & World Report rankings) to go this route.

Most of the reaction to Northwestern’s announcement centered on the new two-year law degree, which some observers (including many commenters at the Wall Street Journal Law Blog) misread as a decision to “drop the third year” of law school. NU Law isn’t reducing its courseload by a third; it’s squeezing the traditional three-year degree into two calendar years, by means of a summer semester, extra courses each semester, and mini-courses between semesters. It’s a far more intense and challenging experience, not the easier one that eliminating the final year of school would suggest.

Predictably, the traditional three-year degree has staunch defenders, including those at NU’s crosstown rivals, who call the new plan an irresponsible compression that will produce inferior lawyers. Others worry that the law school experience is already sufficiently intense, and that cramming it into two years will damage students. But Dayton Law’s Dean of Students Lori Shaw sees no evidence that her program’s two-year enrolees missed out on the full law school experience: “It’s fascinating to see how much they can do.”

Now, in reality, accelerating a law degree by administering it in two years isn’t that big a deal — it’s certainly nothing like the major innovations undertaken at Washington & Lee Law School, which made its third year entirely experiential as part of a massive program overhaul. What really caught my attention — and that of Douglas Berman at Law School Innovation — were other aspects of Northwestern’s announcement that generated much less fanfare. From the Inside HigherEd article:

Northwestern is adding three new required courses (to the nine currently required, largely following a traditional law curriculum), starting with the two-year program and eventually being required of everyone. The new requirements are:

  • Quantitative analysis (accounting, finance and statistics).
  • Dynamics of legal behavior (teamwork, leadership and project management).
  • Strategic decision making.

These topic areas were grouped by faculty members based on the focus groups of what legal employers need….

These are all key elements of any law practice that intends to succeed in the 21st century. Particularly interesting are the mentions of project management, a skill I’m seeing repeatedly referenced by in-house counsel as a must-have ability that most lawyers simply don’t, and teamwork, an essential ability in the new collaborative lawyer-client relationship. Then there’s Northwestern Law’s renewed emphasis on teaching communications skills: Continue Reading

Victims of their own success

After two weeks away from the blogosphere, my RSS feeder has 756 unread posts for me to look at, not including my daily updates from Dilbert, Slumbering Lungfish, and the Astronomy Picture of the Day. One of those 756 posts appeared at LegalWeek’s Editors’ Blog and concerned UK managing partners’ cluelessness and complacency about the impact of the Legal Services Act, particularly regarding the coming ability of UK law firms to go public.

This theme was picked up by Paul Lippe in a (members-only) post at Legal OnRamp, where he acknowledged that successful law firms don’t have much incentive to explore innovative private equity options. But he argued that other kinds of firms will, such as old run-down name firms needing to overhaul, solid midsize firms looking to break out, and stable firms with contentious partnerships. Paul’s money quote:

Whether any of these firms will ever truly “Go Public” I would question; but certainly they can access the capital markets in ways that create liquidity and competitive advantage. The point is (and some lawyers seem almost congenitally incapable of understanding this) that disruptive innovation never comes from the super-elite, and doesn’t have to. The disruption will come from an outsider, but will quickly impact the elite – think Honda and General Motors over the last 40 years, think JetBlue and United Airlines. If these scenarios sound fanciful, remember they are exactly was has happened in a dozen other industries that have been impacted by a combination of global competition and private equity.

Here, with some amendments and additions, is the response I posted:

True enough; as the saying goes, revolutions don’t normally start inside the castle. But I think this is kind of the problem, because in the legal services marketplace, the castle is huge — it encompasses much of the kingdom, in fact. Most law firms consider themselves to be “successful,” which greatly reduces the number of “unsuccessful” firms that would be naturally motivated to try something innovative. Continue Reading

Interview with the publisher

I recently had the pleasure of being interviewed by Cole Silver of The Silver Group, Ltd. for his well-known Expert Audio Series. Cole and I talked about finding careers within the legal profession outside of the default mainstream jobs — one point I focused on in particular was that many new lawyers consider a law firm position to be the standard career choice, and when that choice is unavailable or unsatisfying, they don’t know what to do next. The more these lawyers know about the tremendous array of fulfilling jobs that they can pursue, the better off they, and the profession, will be. I’m Exhibit A.

The Expert Audio Series has a lot of these kinds of stories — scroll about halfway down to find my entry in a section featuring people I greatly admire like Stephanie West Allen, Carolyn Elefant, Susan Cartier Liebel, and Arnie Herz. Other luminaries featured in the EAS include Burkey Belser, Larry Bodine, David Maister and Gerry Riskin. It is definitely worth your time to look into the resources Cole offers through his series, and I really appreciated the opportunity to speak to his audience.

A note to regular readers: personal matters are taking me out of the office and the blawgosphere for the next couple of weeks, although I’ll do my best to post intermittently if I can during that time. To stay updated on when I get back to regular publishing, and to every new post thereafter, sign up to Law21’s RSS feed. Looking forward to being back with you soon.

Conflicts and the law of unintended consequences

The Recorder reports this morning on the rising number of law firm requests that clients sign broad advance waivers (or blanket waivers) that would allow the firms to act against those clients on future unrelated matters. Firms, looking to maximize the amount of business they can take on, are trying everything they can think of to get around conflict of interest rules. Clients, reasonably enough, won’t sign anything that could impair their interests down the road if they can help it.

Clients’ responses to these requests vary according to the size and leverage of both firm and client. Large clients routinely blow them off, because they can — the lawyers need their business more than the clients need these particular lawyers. Smaller clients have less leverage, so if they want to hire big firms, they pretty much have to live by the terms those firms dictate. I can see a couple of trends emerging from this, neither of which is good for large firms and both of which reflect the unintended consequences of size.

First, when a firm is so big that it has to go begging for the right to sue the client in future, the client will correctly diagnose this as a vulnerability that can be exploited. Instead of simply refusing these requests, clients will start calculating just how much (or little) they actually risk by granting such a waiver, and how much the firm has to gain by it. The client might then say to the firm, “Sure, we’ll grant you the waiver — and in return, you’ll knock 15% off all your fees and pick up the costs of a new extranet system.” Large firms’ vulnerability to conflicts is going to cost them at the bargaining table. Continue Reading

Don’t be stupid

Google is of course famous for choosing the motto “Don’t be evil.” A lot of law firms could do themselves a favour if they adopted a slight variant: “Don’t be stupid.”

Law firms love to roll out big announcements of one kind or another, this or that latest success or significant hire. But it’s in the countless little things, the daily offences against sensibility that add up to the institutional bad habits of a lifetime, where firms undercut all the progress they could and should be making. Too many law firms are their own worst enemies.

You see this in partnerships that won’t enforce the rules against uncooperative or alienating partners who happen to bring in a lot of revenue. You see it in senior lawyers who consistently hoard the best work and the most client contact, driving juniors first to frustration and then to competitors. You see it in firms that know perfectly well that women lawyers leave because the partnership track conflicts irreconcilably with their priorities, yet refuse to change an iota of the process. You see it in firms that unfailingly prioritize short-term profits over long-term interests, and more besides.

You see it especially in hiring decisions, as Alex Novarese put it bluntly at Legalweek:

In any one year in the City you’ll see a good handful of senior hires that are breathtakingly ill-conceived. ‘Bad’ in these cases can mean … good lawyers with no cultural fit with their new employer or being the wrong personality type for the task at hand.… [But] there’s also a rich seam of chancers, time-wasters, burn-outs and the plain bored on the transfer market. And within this circle there’s a hardened sub-group that have such serious problems that it’s a miracle they made it past the first lunch or interview, let alone got a lucrative new equity partnership. These are the cases in which the failure is not to do with lack of due diligence, more a complete collapse of common sense.

And you see it in a story I heard this morning: at an established law firm not in a galaxy far, far away, a 71-year-old partner dies suddenly, to the shock and consternation of everyone. Particularly hard hit is his long-time secretary, who of course accompanies the late lawyer’s other colleagues to his funeral last Friday. The following Monday, the secretary arrives at the office and is told she’s being laid off. I leave to your imagination the dazzling impact this doubtless will have had on firm morale.

This blog always tries to provide solutions to any problem it raises. Here, there’s not much I can say beyond, run your firm according to the minimum standards of any self-respecting business. Be fair towards everyone, reward good behaviour, hire the right people, think about tomorrow, and try not to fire people after their boss dies. Don’t be stupid.

Innovation requires clients to step up

Bruce MacEwen at Adam Smith Esq. reports on a presentation he attended at Allen & Overy’s New York office titled “Innovation in Legal Service Delivery,” featuring high-profile law firm lawyers, in-house counsel and consultants. The gist of the event and his article is that innovation of this type is still very much wanted and isn’t nearly the hopeless cause many like to believe. As a certified aficionado of legal marketplace innovation, I agree on both counts.

Bruce ends his post by asking a central question: “How shall we continue these discussions? Are they best conducted in law firm-sponsored colloquies such as this? Under the auspices of a legal publication such as The American Lawyer? At dispassionate fora and conferences put together by and hosted at a law school?” I have a couple of thoughts to offer here.

First, the conversation should continue wherever and whenever it can take root and flourish, especially in the blawgosphere, as part of a continuing effort to draw in as many decision-makers, and generate as great a sense of urgency around this subject, as we can. Legal services delivery innovation captures the imagination of lawyers at the grassroots level — at what event speaker Paul Lippe called the “immensely strong pockets of innovation” in law firms. Tapping into those pockets, through online and other vehicles, will multiply and magnify the volume and impact of that conversation.

But secondly, and more importantly, the effort to lionize innovation in the law needs more than law firm colloquia, legal periodical articles or law school efforts, helpful as all these would be. It requires more than the excellent College of Law Practice Management’s Innovaction Awards or the Financial Times’ legal innovation series. Innovation in legal services delivery will not succeed unless clients get seriously and deeply involved in the process. Continue Reading

The danger of discounted rates

At the risk of being mistaken for an Ayn Rand devotee, one of my favourite moments in The Incredibles comes when Helen (Elastigirl) is admonishing her son Dash, who’s upset because he’s not allowed to use the super-speed that makes him special. “Everyone’s special, Dash,” says Helen, to which Dash mutters under his breath: “That’s another way of saying no one is.”

I thought of that line when I read the results of a fees and pricing benchmark survey published by RainToday.com (HT to The Greatest American Lawyer via Legal Blog Watch). Headlining the uniformly interesting results was the observation that 78% of all firms discount their rates (a startling 89% of firms with ten lawyers or more) from what they’ve advertised or initially advised the client. The average discount is 9.9%.

When everyone is discounting their rates, then no one is.

When you hear “alternative billing” discussed by lawyers and clients today, what’s being talked about most frequently is rate discounts: the lawyer knocks X percentage or Y dollars off the “going rate” in order to satisfy a client demand. The client is happy because she feels she carries enough influence to force a fee break; if she’s in-house, she can report to her bosses that she haggled the lawyer down from the starting rate, thereby proving her negotiating acumen and hard-line position on costs.

The lawyer’s happy too, for a bunch of reasons. The rate is not nearly as important as the number of hours he can bill, which has a far greater impact on the final tally and is anyway the criteria that the partnership cares about most. Moreover, any halfway clever lawyer builds into his rate the distinct possibility of future discount, ensuring that the final actual rate doesn’t plunge too deeply below what he actually wants to make. And of course, the most important thing is to actually get the work and strengthen the relationship, to ensure more work in future. In this light, the rate is a card the lawyer can afford to play early and easily when negotiating the overall agreement to produce legal work.

This lovely scenario grows problematic, of course, when discounting becomes so ubiquitous that it loses its cachet as a real benefit to the client. Continue Reading

Your invisible professionals

So here’s a typical situation: I’m assigning an article for one of our CBA publications on a law firm practice topic — say, business development, or extranet use, or associate retention efforts, or what have you. And I want to find interviewees with knowledge and expertise to speak with our writers for said article. So one of the first places I’m inclined to look is within law firms themselves, to speak with the professionals in charge of these areas.

Except I can’t. Because with few exceptions, law firm websites do not list biographical or contact information for their non-lawyer professional staff. According to most law firms’ websites, even some of the largest and most challenging to operate, their offices contain lawyers and nobody else — all the day-to-day operations that sustain the firm, from accounting to marketing to IT to knowledge management, apparently happen independently, as if by magic.

Here’s a partial list of the key professionals within law firms who are rarely mentioned on firm websites:

  • Chief Administrative Officer
  • Director of Associate Retention
  • Director of Business Development
  • Director of Finance
  • Director of Human Resources
  • Director of Information Technology
  • Director of Knowledge Management
  • Director of Marketing
  • Director of Student Recruitment
  • Head Law Librarian
  • Webmaster

In fact, almost the only non-lawyer professional you’re likely to find on a law firm website is the Director of Media & Communications, if only because that person’s name shows up at the bottom of press releases. Then again, it’s just as likely the director’s name won’t show up — it’ll be the more junior media liaison who’s supposed to get all the calls from the press.

If this were just an inconvenience for media types like me, then you could almost forgive this oversight, despite all the lost opportunities to promote the firm’s name in the legal and business press. But the real damage, I think, is to the morale and status of these staff members, who work just as hard and take just as much pride in their craft as any lawyer, but who receive no public recognition from their employers. Continue Reading