Repainting or renovating?

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Posted in: Clients, Innovation

There’s repainting, and then there’s renovating. Innovation in the practice of law can take either of these forms, and while there’s nothing wrong with a fresh coat of paint or moving the furniture around, installing new support beams and ripping out the plumbing is a whole other order of commitment to change.

As a useful example of repainting, word from the UK is that 18 major law firms are getting together to establish a new “carbon footprint” protocol for their industry. The Lawyer reports that the “Legal Sector Alliance, a movement of law firms and organisations committed to working collaboratively against the climate threat, [will] provide law firms with a practical guide to adopting environmentally sustainable practices.”

Not meaning to discourage any sensible steps towards a better environment, and the firms deserve credit for promising to reveal footprints that could be embarrassingly larger than expected; the free market in saving face is a powerful force in a tightly knit profession like ours. But best intentions aside, this initiative will have a lot more of an impact on, say, marketing and community relations than it will on the fundamental business of these firms: serving their clients.

Clients are looking for something a little more substantive. Mike Dillon, GC of Sun Microsystems and occasional but engaging blogger, expressed as much in a post last month called simply “Finding Value.” Mike ticks off areas of needed reform in law schools and legal media, and acknowledges that clients need to step up, too. But law firms, he says,

need to understand every component of their operating expense and business model. What is the cost of attorney turnover in the firm? What are its core v. non-core technical strengths? Can the firm manage sub-contractors (i.e. other legal service providers) to provide more cost effective services to clients in non-core areas? Does the firm fully understand its customers and does it tailor its services to the customer’s specific needs?

These are the kinds of questions that start the kinds of conversations among lawyers and clients that we need. To that end, let me direct you to a very promising conversation just getting started: Continue Reading

The rise of good enough

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Posted in: Clients

Developments last week in the world of electronic discovery have gotten me thinking about matters of a weightier nature. The Wall Street Journal published an article about the rise of automated e-discovery services and the degree to which they’re eliminating the need for lawyers in this area (it’s subscriber-only, so I’m relying on the good graces of Carolyn Elefant at Legal Blog Watch, who provides some highlights).

New e-discovery tools, says the article, promise cost savings of more than 85% — something bound to elicit sweet hosannahs from clients, but perhaps rather different responses from lawyers. One such lawyer, a partner at Fenwick West, cites a cautionary tale of a client that decided to go the cheap route and handed over an e-mail archive search to its internal IT personnel. You can guess the result: disastrous disposal of necessary files and big money paid to the law firm to clean up the mess.

Now, there are two things worth noting about this example. The first is the dichotomy it suggests: either have the professional lawyers do the work or give it to the complete non-specialists, and no in-between. But in fact, there’s a lot in between, and some law firms are figuring this out. Ron Friedmann at Strategic Legal Technology brings us word that Dorsey & Whitney has launched its own e-document review service, at fixed prices to boot. As Ron says, this is less a challenge to e-discovery providers than it is to other law firms, who might have to start rethinking how their business models incorporate e-discovery.

But there’s another angle here, one that goes to a more foundational matter in the law. The example above presents a familiar, even archetypal warning to clients: engage a lawyer now to do the job right, or engage the lawyer later, for more money, to fix the mess you made by trying to do it on the cheap. You might even call this the Cardinal Principle of Lawyer Marketing: the short-term cost of hiring a lawyer is less than the long-term cost of going without one. We’ve all heard it, and many of us have used it, but few of us have examined its foundation or implications. Continue Reading

Podcast on conflicts of interest

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Posted in: Clients, Governance

Law21 was quiet for a week while I worked the Canadian Bar Association’s Canadian Legal Conference in Quebec City. Among the highlights for me was moderating a podcast on the CBA’s just-released Final Report of its Task Force on Conflicts of Interest. You can access the podcast by clicking the third link in the right-hand column on the CBA’s Conflicts Home Page.

The podcast, which runs less than 25 minutes, featured three members of the task force: Chair Scott Jolliffe, managing partner of Gowling Lafleur Henderson LLP, and members Gord Currie, EVP and General Counsel of George Weston Ltd., and Simon Chester, a partner with Heenan Blaikie LLP and fellow Slawyer. We talked about the report’s principal recommendations, the valuable Toolkit that accompanied it, and why conflicts matters so much to both lawyers and clients. Hope you find the program interesting and the report useful, no matter where you practise.

The Web is bigger than you think

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Posted in: Clients, Technology

A watershed moment is occurring at the Beijing Olympics — or more accurately, in the head offices of the broadcasters covering it. Online viewing of Olympic events has shot into the stratosphere — this Globe & Mail article on the subject uses terms like “shattering” and “unbelievable” to communicate the enormity of what’s happening. Here are some statistics to make the point.

CBCSports.ca is averaging two million page views a day. A year ago at this time, the site was getting about one million views a week. The CBC’s live streaming and video-on-demand services are receiving close to 250,000 hits daily. …

At NBC.com, it took only four days to surpass the entire Athens Olympics in page views. Beijing has 291.1 million views so far, compared with 229.8 million for all of Athens. On the first day of the Athens Olympics, NBC had 65,346 video streams. For Day 1 at Beijing, the number was 1.65 million.

The Olympics are the perfect webcast event — numerous events taking place simultaneously, each with its own devoted audience. In the past, networks had to choose the one event likely to garner the highest ratings and televise it, to the chagrin of the long tail of other events’ diehard fans. But with the web, the broadcasters can “televise” as many events at one time as they like on separate streamed web pages, with the added viewer bonus of reruns and replays on demand.

For the last few years, all the major networks have been poking around with the Internet like a new toy that they haven’t quite figured out how to use yet. The Olympics should prove to be the tipping point at which the networks (and their advertisers) realize an important truth: television is only one medium through which content can be delivered, and compared to the web, it’s a limited, inflexible, single-channel medium. The CBC’s Scott Moore reported a conversation with the IOC’s Jacques Rogge: “We both agreed that it is not the wave of the future. It’s the wave of the present.”

Is this still a blog about the legal profession? Yes, it is. And I think there’s an important lesson here for lawyers: we’ve all been thinking about the Internet too narrowly. Continue Reading

Could clients drive firms to do more pro bono?

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Posted in: Clients, Purpose

Australia, the legal profession’s innovation laboratory, is busy delivering another dose of fresh thinking. The state of Victoria is requiring all law firms that take on legal work for the government to perform pro bono work as a condition of the retainer — specifically, to the tune of 5% to 15% of the total value of their government contracts (most choose 15%). According to an article in the May 2008 issue of the New South Wales Law Society Journal, the scheme is now being considered for introduction countrywide.

The idea is not universally popular. Opponents raise two main objections: that reducing pro bono to a commercial consideration undermines the altruistic nature of the work for both provider and assistee, and that it’s unfair to single out lawyers when no other suppliers of professional services to government face the same obligation. Supporters counter that the government is leading rather than mandating, that the requirement is far from onerous, that legal services are uniquely in need of pro bono provision, and that many law firms now take pro bono seriously as a fundamental element of the business, driving up its adoption throughout Victoria.

I think it’s a great initiative, especially because it seems like a work in progress. One of the firms involved in the program suggests two improvements if it goes Australia-wide: that the government increase its legal aid and community legal sector funding, to make clear that pro bono is not and never will be a substitute for legal aid; and that the government continues to be prepared to waive conflicts claims in pro bono cases involving the government as a party. Add these two elements, and this might be pretty close to a perfect system.

In fact, I think it’s exportable — and not just outside Australia. While it’d be great to see governments in other countries adopt this program, I don’t see any reason why large corporate clients couldn’t do the same thing. Continue Reading

The new brand landscape for law firms

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Posted in: Billing, Clients, Marketing

I received a package the other day from a prominent law firm announcing a rebranding, which seemed to consist of a shorter name and a clever new logo. There didn’t seem to be anything otherwise new or different about the firm, so the brochure went straight into the blue box. But I was reminded of a remarkably similar mailing I received, something like eight years ago, from a big firm that, like this one, had shortened its name, come up with an abstract logo, and called it rebranding.

So it might be time to review what a brand is and is not. This is important, because right now, we’re on the verge of a major shift in the law firm brand landscape.

1. A new name and a new logo do not constitute a new brand. A brand is a promise — a guarantee of identity, reliability and/or quality. A brand is what your customers come to expect about your product’s or service’s performance and delivery.

2. Whether your brand is a good one or a bad one depends almost entirely on how well or how poorly you perform that function and delivery.

3. An effective brand is unique, or at least easily distinguishable and differentiable from the competition, and is aligned with your actual conduct. An ineffective brand is one that’s belied by what you actually do — a company that doesn’t follow through on its brand promise hollows out the brand’s effectiveness.

Now, law firms are, generally speaking, terrible at branding, for a couple of reasons. First, most firms don’t stand out from their competition in terms of the services they offer, the solutions they recommend, the rates they charge and the manner in which they bill. So it doesn’t matter how they brand themselves, they all act essentially the same way and are effectively indistinguishable from clients’ points of view.

Secondly, when law firms do make brand promises, they don’t keep them consistently, if at all. Partly this is because their promises are abstract and extravagant — how can every law firm have “top-tier practitioners” with “leading litigation and corporate abilities” who “provide the highest quality legal services” (quotes taken at random from law firm websites)? Here’s a fun exercise — read 50 law firm sites and count how many firms work for “many of the leading corporations and financial institutions in the world.”

And partly it’s because most law firms have no mechanisms to enforce follow-through on their brand. How can clients expect a consistent type of service when every partner is effectively autonomous, project management templates are rare or non-existent, and key talent leaves and enters the firm like a carousel? So most law firms suffer from the twin brand defects of not offering anything uniquely distinguishable from the competition, and not offering it in a reliable fashion.

That’s the bad news. Here’s the good news: the range and types of brands available in the law are exploding as we speak. Continue Reading

You can’t charge for that anymore

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Posted in: Billing, Clients, Innovation, Technology

There’s a process revolution underway in the legal marketplace, and yesterday brought two more reports of cannon fire. The ABA Journal published a primer (HT to Legal Blog Watch) by Boston lawyer Jay Shepherd on how to establish a flat-fee billing system. It’s not an airy, wouldn’t-it-be-nice piece; it’s a practical guide borne of his firm’s successful experience with abandoning hourly rates. The key step: reviewing eight years’ worth of bills to figure out exactly how much it costs the firm to complete various client tasks.

Meanwhile, Larry Bodine linked to a Forbes magazine story about FastCase, a Washington, D.C.-based company that provides access to an online, digital, searchable collection of U.S. case law at much lower costs than those charged by traditional publishing powerhouses West and Lexis. The article describes similar ventures launched by other organizations, without even getting into the Legal Information Institute collection and its offspring around the world.

So for those of you keeping score at home, here are two more things you won’t be able to build into your legal bill the way you used to:

–> the standard lawyer fuzziness around just how much it’s going to cost to do something the firm has done before; and

–> most commercial online legal research services, because the cheap or free alternatives are proliferating.

These two entries join a growing list of items law firms can no longer charge out at pricey associate rates, if they can charge them out at all: Continue Reading

Core competence: 6 new skills now required of lawyers

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Posted in: Clients, Collaboration, Competition, Management, New Lawyers

Up till now, the necessary and sufficient skill set for lawyers has looked something like this (in alphabetical order):

  • Analytical ability
  • Attention to detail
  • Logical reasoning
  • Persuasiveness
  • Sound judgment
  • Writing ability (okay, that one’s apparently optional for some)

This list doesn’t include such characteristics as knowledge of the law, courtroom presence, or integrity — these aren’t “skills,” per se, so much as information one acquires or basic elements of one’s character. Even innovation, which I prize so highly, is first and foremost an attitude and willingness to think and act differently.

Rather, I’m concerned here with actual skill: a ready proficiency or applied ability acquired and developed through training and experience. Your degree of character, diligence and intelligence are innate characteristics; skills are what you acquire through their application. If you possessed these six skills in sufficient abundance, you were fully qualified to practise law.

Well, not anymore. From this point onwards, while these skills remain necessary, they’re no longer sufficient: they constitute only half of the set necessary to practise law competently, effectively and competitively. Here’s the new six-pack, the other half of tomorrow’s — no, today’s — minimum skills kit for lawyers (again in alphabetical order). Continue Reading

Talking to ourselves

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Posted in: Clients

American Lawyer magazine has released the 2008 edition of its A-List — its ranking of the firms that “best embody what it means to be a success in the legal community.” If you’d like to know about the cream of this particular crop, here’s the top 20 (registration required).

To produce the A-List, American Lawyer takes results from three of its own scorecards (revenue per lawyer, pro bono commitments and associate satisfaction) and one from the Minority Law Journal (diversity) and crunches them to get an overall score. RPL and pro bono scores are doubled, then added to the raw satisfaction and diversity numbers: (RPL score x 2) + (PB score x 2) + AS score + D score.

Now, it seems to me that, at the great majority of law firms, the relationship among these four criteria could be better estimated as (RPL score x 9) + (AS x 1) + (PB x 0.5) + (D x 0.2). So if a firm has managed to generate equivalent ratings in both RPL and pro bono or associate satisfaction, I’m inclined to think it’s done a pretty good job of figuring out the system, just as law schools have done with the US News and World Report law school rankings. And I think that recruits (for whom the A-List is surely intended) who believe that these firms have managed to magically balance big profit with big commitment will end up disappointed.

But anyway, what bothers me more about the A-List is that it’s yet another lawyer or law firm ranking tool that gathers its data from lawyers or law firms themselves. The AmLaw 100 does it, too. So does Avvo. So do almost all the legal periodical surveys that rate lawyers in a particular practice area or region. Most legal profession ratings and rankings are heavily or entirely influenced by lawyers’ opinions of themselves. That makes for a nice echo chamber effect, but it doesn’t tell us much about which lawyers and law firms are most effective at what (presumably) we’re here for: to provide legal services to clients. Continue Reading

Conflicts and the law of unintended consequences

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Posted in: Big Firms, Clients, Ethics

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