Beyond Facebook

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Posted in: Collaboration, Innovation, Technology

Lawyers are going to have to figure out what to make of social networking. By and large, as the link to the articles in last fall’s edition of National indicates, a few are active believers, a few more are cautious optimists, and the vast majority are dismissive or clueless. I can actually understand that. I’ll be the first to admit that Facebook is a pleasant distraction and offers some tantalizing prospects for collaborative achievements, but I’ve received one too many Zombie invitations to be a huge fan. Time-pressed lawyers need fewer distractions, not more.

But Facebook is not everything that social networking is or can be. Using social software to connect and collaborate for any number of purposes is still in its infancy, and there are any number of law-related applications that we’ve just begin to think about. Could we use it to improve legal publishing? Absolutely. Could it be used as a marketing tool? Sure. Could we use it to make the legal conference more effective? Why not?

Now, from Ross Kodner, who’s attending LegalTech in New York, comes word that Microsoft, of all companies, is offering the next big application of social networking for lawyers: using its SharePoint system to create a practice management system inside a law firm that runs on social networking principles. Ross is evangelical in his enthusiasm for what he calls intrasocial networking:

SharePoint connects data . . . and people . . . and opportunities like no other practice management approach I’ve seen. Intrasocial networking will propel law practices of all sizes to surpass currently foreseeable revenue targets, and to surpass client expectations. Intrasocial networking will allow law practices to intrinsically incorporate traditional corporate concepts of “quality control,” “customer satisfaction,” and maybe even eventually, Six Sigma mentalities ….

We’ve only scratched the surface of what social networks will allow us to do as lawyers. Collaboration is one of the cornerstones of the new legal profession, and social networks are the early manifestations of how it will happen. This will be fun.

Hat tip to Legal Blog Watch for the LegalTech links.

Transforming the practising bar

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Posted in: Big Firms, Governance, Innovation

If you’d like a glimpse of the legal profession of the near-to-mid-future, look to London. Yesterday, the UK’s Bar Standards Board launched a consultation paper concerning the effect on barristers of the new Legal Services Act, which received Royal Assent last October. (The Solicitors Regulation Authority addressed the LSA’s impact earlier.) Here’s LegalWeek and The Lawyer on the announcement.

The BSB’s 50-page consultation document asks for submissions on how the Board should respond to the LSA, specifically regarding Legal Disciplinary Partnerships (different types of lawyers and a minority of non-lawyers practising together) and Alternative Business Structures (firms that offer both legal and non-legal professional services and that could be owned by non-lawyers, from shareholders to supermarkets). LDPs might not seem like a big deal to North American lawyers accustomed to our fused profession, but we should understand that it represents a whole new way of looking at the Bar in England and Wales, and it won’t be an easy road there.

But it’s the ABS regime that has people on this side of the pond talking, because it authorizes not just multi-disciplinary practices, which the Canadian and American bars wrestled with and ultimately rejected over the past decade, but also non-lawyer ownership of legal service provision, which is anathema to the vast majority of lawyers and their regulatory bodies. ABSs aren’t likely to appear in the UK before 2011 — it takes time to set up an entirely new governance structure for an ancient profession — but they will come. And when they do, it’s only a matter of time before they cross the pond.

There’s been a lot written about the future impact of the LSA on North American lawyers — Bruce MacEwen has been on top of this from the beginning — but it seems to me that if any member of the Magic Circle floats shares, merges with an accountancy, or otherwise takes advantage of the ABS options to greatly enhance its capital and strategic reach, then their New York-based competitors are going to want a level playing field on which to compete. And if that kind of regulatory change occurs in one US jurisdiction, dominoes will start falling all over various states and into Canada. In a globalized economy, any country that refuses to allow its lawyers to play by the same business rules as their foreign competitors will relegate those lawyers to a purely local purview. That’s not in anyone’s interests.

This is not happening overnight — probably we’ll see this whole situation play itself out around the middle of the next decade. But it’s not far away, either: by the time today’s first-year law students are into their third year of practice, this will be the reality on the ground. The challenge for law firms is to start thinking now about what kind of business structure makes the most sense for their practices and clients, because their options should expand dramatically in the near future. The challenge for governing bodies is how to prepare themselves and their members for an entirely new way of organizing the practising bar.

Here’s a parting thought from BSB Chair Ruth Evans, announcing the Board’s consultation paper: “We may not see barristers selling their services in the supermarket aisles quite yet, but we can expect changes in the way some organize their affairs and offer their services.” Emphasis added, and how.

Eversheds: how to set new client standards

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Posted in: Big Firms, Globalization, Innovation

I was jazzed a year ago when Eversheds struck a deal with Tyco to become the service and manufacturing multinational’s primary outside counsel, reducing Tyco’s complement of law firms for most legal matters from 250 to 1. Those who doubted the wisdom of the arrangement at the time worried that Tyco would miss out on other firms’ offerings and would suffer from Eversheds’ inevitable sense of complacency, while the firm would be at a greater risk of business-losing conflicts. Even when international gas and engineering giant Linde struck a similar deal shortly afterwards with DLA Piper, there was still uncertainty over this kind of approach.

Well, one year on, says The Lawyer, Tyco is still partnering with Eversheds and singing its praises, especially since the firm must get Tyco to sign off on every legal task it performs on the client’s behalf in order to get paid for it. So how did Eversheds do? Today, it’s now sitting on no fewer than six similar arrangements with other companies, each of which looked at the Tyco deal and were impressed by what they saw. Now other London-based firms are trying to emulate Eversheds’ approach, including Hammonds and Pinsent Masons. So I’d say, on the whole, that this has been a pretty successful undertaking so far.

What really impressed me here, though, is how Tyco’s partnership with Eversheds indirectly helped bring the six other companies on board. When Eversheds first proposed the present arrangement to Tyco, it proffered two cutting-edge software programs: Dealtrack, a budgeting and cost management tool, and Rapid Resolution, a project management application for litigation. But Tyco wanted more: it wanted a way to precisely estimate the total amount it was spending on its legal services company-wide.

Eversheds rose to the challenge and integrated Dealtrack and Rapid Resolution into a more powerful new program called the Global Account Management System (GAMS). “The system breaks down a company’s legal spend by country, jurisdiction or practice area, providing a heat map [of] where money is being either wasted or used efficiently,” says The Lawyer. But there’s more to it than even that. Continue Reading

MCLE’s new look

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Posted in: CLE, Innovation, Small Centers

The cover story for National‘s March 2008 edition will explore mandatory continuing professional development, or MCPD, which will be up and running in Canada less than a year from now. If you’re from England, Wales, Australia, or any of the 43 US states with MCLE regimes, it might surprise you to learn that no Canadian jurisdiction currently mandates ongoing professional development among its members. If you’re from Canada, it might surprise you to learn that a Canadian jurisdiction is going to do just that.

A little less than three months ago (November 7/07), the Law Society of British Columbia’s Lawyer Education Committee released what I expect will one day be seen as a landmark report on MCPD. Earlier this month, the law society accepted the committee’s recommendation for a limited CPD regime in B.C. starting in January 2009. Other provinces are talking about MCPD to a greater or lesser extent, including Manitoba, Ontario, Quebec and Nova Scotia, but none currently intends to go as far as B.C. is going. I recommend the final report, and its interim antecedent, for a thorough and impassioned exploration of the state of post-call legal education in Canada and worldwide.

For me, however, the landmark nature of the report doesn’t arise so much from the new mandatory status of CPD. One way or another, either through law society requirement or through outside intervention by the marketplace or the state, the days when lawyers could choose whether or not to upgrade their skills and knowledge are coming to an end. What’s really promising about the B.C. decision is the broad range of approved CPD activities. Continue Reading

Something’s actually happening

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Posted in: Big Firms, Billing, Clients, Competition, Innovation, Leadership, Management

There’s a lot of buzz building about an article in today’s New York Times with the rather odd title “Who’s Cuddly Now? Law Firms.” It summarizes a recent rash of new business models in American law firms, from flextime for lawyers to flat-fee bills for clients to alternative billable-hour schemes and more. It’s the second article the Times has run recently about lawyers seeking satisfaction, and it prompted its rivals at the WSJ’s Law Blog to ask: is there really something happening here?

The WSJ blog’s readers are providing their usual snarky responses: “This new ‘movement’ will dovetail nicely into the massive layoffs that will be coming in the coming months,” says one. “So, you want more time with your family or to pursue your passion for flamenco guitar? Here is 3 months severance.” Nice. So, here’s my answer to the blog’s question: yes. As Judith shouted at Reg in The Life of Brian, “Something’s actually happening!”

I can refer to you any number of articles and links about law firms that are making changes to the way they manage their employees and their work — see the Financial Times‘ law firm innovation report and the Innovaction Awards, for starters. In addition to the firms identified in the Times article, there are others making changes to how they operate in terms of compensation, of partnership, of billable hours, of women in law firms, and even of the entire firm itself. And these are just a few of the ones we hear about — other changes are occurring, quietly and beneath the radar, in areas such as recruitment, retention, training, parental leave, and evaluation.

Law firms are under pressure. They’ve gotten used to a comfortable world where they could set the tone and pace of operations. That comfort zone is evaporating from two directions: externally from clients and internally from lawyers. Clients really are more sophisticated and more demanding, and they’re looking for more than their firms have traditionally been willing to give them. And lawyers really are more inclined to walk away from (or try to change) work conditions that don’t satisfy a wide range of personal needs.

But even that’s not really new — both clients and lawyers are longstanding complainers, and pressure has been brought before, which law firms have ignored. And keep in mind that many, many law firms are continuing to ignore these pressures. What’s really new this time, I think, is not just that law firms are changing the way they do business, but why. I think they’re doing it, voluntarily, to gain a competitive advantage. Continue Reading

Legal secretaries 2.0

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Posted in: Innovation, Management, Technology

With an assist to Ron Friedmann‘s Strategic Legal Technology blog for locating the story, here’s another neat law firm innovation that qualifies as a “why didn’t we think of that?” moment. A Buffalo law firm, Rupp Baase Pfalzgraf Cunningham & Coppola LLC (I’m sure glad I don’t answer the phones there), is giving each of its legal secretaries a specialty for which she’s responsible and to which she can devote her attention and training, rather than assigning her to work for a specific lawyer. Here’s the managing partner, Tony Rupp, with the details:

“We have secretaries specializing in different fields,” Rupp said. “We have someone who’s filing, someone who’s calendaring, someone who’s filing motions and several typists who are concentrating on transcribing the dictation and producing the documents.”

This is a great idea, and it highlights an area in which law firms have been extremely slow to innovate: workflow. The traditional alignment of one lawyer -> one secretary still makes sense in a solo practice, but in a firm with multiple lawyers and a large volume and range of tasks to perform, keeping that alignment just encourages redundancy and inefficiency.

Allowing secretaries to focus on and develop expertise in one particular area creates clear channels through with assignments can flow much more easily and efficiently. Lawyers have specialties; why shouldn’t their secretaries have them too? More importantly, logistics is revolutionizing commerce worldwide, and while a study of law firm logistics (or rather, the near-complete lack thereof) would be a major undertaking, it’s still encouraging to see even one example of a firm willing to rethink how it accomplishes its daily work.

Now, that said, what disappoints me about this effort is that the secretaries’ specialties are still largely clerical and administrative. Continue Reading

Virtually legal

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Posted in: Innovation, Small Centers, Solo & Small Firm, Technology

I’ve just assigned a feature article for the April/May 2008 issue of National that aims to explore the future of the sole practitioner. As I noted in a previous post, I’m worried about the near-term prospects for solos, especially in smaller centers, but I’m bullish on their chances down the road, so long as they’re willing to rethink their business models and invest in technology and innovation. Two recent articles make me think that the brighter future for smaller practices might arrive sooner than anticipated.

Stephanie Kimbro is a North Carolina solo who operates a virtual law office. In a guest post at Susan Cartier Liebel’s Build A Solo Practice LLC blog, Kimbro describes her wholly web-based practice: no physical office quarters, secure personal home pages for clients, and a state-wide client base that can access its files 24/7. She provides unbundled services, bills and collects over the Internet, and competes with big firms using just the merest fraction of their overhead costs. Best of all, she’s in control of her own time and her own life. She’s already heard from other solos who want to license her homegrown software application and launch similar VLOs.

Further north in Pittsburgh, we find the Delta Law Group, two lawyers who have created, if possible, an even more innovative virtual firm. New clients are met by a partner who videotapes the detailed first consultation and then outsources the file to one of several local solos and specialists. Like Kimbro’s firm, Delta provides its clients with a secure extranet to follow the progress of their matters and conducts its administrative tasks online. Delta profits from an extremely low overhead as well as from access to a range of talented lawyers in whatever field of expertise is required.

These virtual firms obviously have their limitations — for example, they can’t take on huge or complex matters — but today’s small practices have the same strictures, serve the same kinds of clients and take on the same typical matters. The difference is that these firms liberate their lawyers from the burden of overhead, empower their clients with access and choice, acquire clients hundreds of miles away, and hire talented lawyers only for the duration of a single file. Oh, and they can afford to charge very reasonable rates. None of it would be possible without the Internet, or without an openness by these lawyers to innovation.

Small, flexible, accessible, affordable, and turn-on-a-dimeable — that’s what tomorrow’s solo and small firms will look like. It seems that, in some quarters at least, tomorrow has arrived early.

Amazon.law

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Posted in: Clients, Innovation, Technology

This post originally appeared as an article at Slaw on December 16, 2007.

If you’ve ever ordered an item from Amazon, you know that every time you log back in to the website, you’re greeted with a list of recommended books, CDs and DVDs. Amazon compiles this list based both on your product purchases and the pages you’ve recently browsed. Essentially, Amazon alters its understanding of and relationship with you every time you use its services — whether browsing, adding items to your shopping cart, or actually purchasing something. Every point of contact between you and Amazon is another data point that redefines the relationship’s fluid dynamic.

There’s a lesson here for lawyers, and with technology continuing to evolve at an astounding rate, it’s a lesson that lawyers can start implementing right now. Lawyers already can — and someday, they all will have to — tailor their interactions with clients in the same way.

In the Amazon.law era, all types of client behaviour and activity can be automatically recorded and used to create and constantly improve a multi-dimensional profile of the client. This profile in turn can guide the lawyer’s interactions with the client, from billing and communication to service delivery and business development. To some extent, the technological tools to do this, from database software to customer relations management, already exist. Continue Reading

Three for the money

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Posted in: Innovation, Law School

Three interesting items in the inbox today, each of which reflects a different facet of the many forces hard at work on producing imminent changes to the profession.

First comes news from the ABA’s Law School Admissions Council that the number of applications to U.S. law schools dropped in 2006 by 7.6%, the second straight annual decrease on top of a sharp deceleration in 2004 in the longstanding trend of rising admissions. The linked article focuses on the drop in both applications and admissions among women, and properly so. But many of the reasons for the decrease cited in the article — stronger economic times, more lucrative non-law career paths, bad publicity about punishing workloads in law firms — cross gender barriers altogether. With the talent wars in full swing, the private bar will not be happy to hear of a potential trend towards smaller graduating classes. I’d be very interested in seeing similar statistics from Canadian law schools.

Secondly, the consultants at Grant Thornton have released their 2007 Professional Services Insights survey, which looks at numerous mid-sized professional firms in fields such as engineering, architecture, and especially law (almost half of all respondents were law firms). The report says professional firms’ fundamental management models will have to change, in light of client consolidation, talent recruitment and retention, and generational cultural changes. “A broader team-based model characterized by a firm-client relationship will need to be adopted by professional services firms, to respond to the broader needs faced by clients and the new career demands of next-generation practitioners,” the press release says. “The report identified a trend toward this type of thinking at architecture and engineering firms, but” — you know where this is going — “less so among law firms.”

The day’s final story contains news of one law firm in Alberta that apparently is ready to adopt and adapt to the dynamics of 21st-century business. The Calgary Herald reports that the law firm of Shea Nerland Calnan is the joint owner of a new tax advisory firm called Moody LLP. The new firm isn’t providing any accounting services, even though most of the employees are CAs — it’s offering purely advisory and tax planning services. “What we see is the mid- to small-sized accounting and legal practices in the province don’t have tax planning departments,” Nerland told the Herald. “There are more and more people in need of those top-end planning services. There’s a lot of opportunity there.” There’s also a lot of opportunity for law firms to make bold strategic moves like this — Moody LLP is the first such jointly owned tax advisory practice in Alberta and only the third in Canada.

There’s a real first-mover advantage available to lawyers and law firms that feel the ground shifting under their feet and reposition themselves accordingly. It’ll be interesting to see who moves fastest and best.

This post originally appeared at Slaw on October 2, 2007.

What clients want

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Posted in: Clients, Competition, Innovation, Technology

What do lawyers sell? To this day, you’ll hear a lot of lawyers say, “The only thing I have to sell is my time.” That’s the wrong answer, not only because it encourages our unhealthy fixation on hourly billing, but also because most clients prefer to pay for as little of our time as possible.

It’s also wrong to say that “lawyers sell knowledge.” We used to make a living at that, because we were virtually the only ones who had access to legal knowledge, and scarcity produces demand. We knew what there was to know and could solve the problems people pay to have solved.

But the Internet has helped make basic legal knowledge ubiquitous, non-lawyer competitors have turned intermediate legal knowledge into marketable assets, and as our cover story on information overload makes clear, advanced legal knowledge — “knowing what there is to know” — is becoming a practical impossibility. Legal knowledge, per se, is an increasingly shaky foundation upon which to build a competitive business.

So what can lawyers sell? Well, in the past few months, I’ve come across three firms (two Australian, one American) that have created online compliance and training programs for corporate clients. Employees log in and complete a series of lawyer-designed training modules that explain the legal and regulatory obligations in a given area, from employment law to corporate governance to privacy issues.

In the result, the client upgrades its employees’ competence, reduces its risk exposure, and can respond with detailed records to outside audits and reviews. The law firm earns a fee for the service while cementing its relationship with the client, and its lawyers spend their time on other value-building work rather than fielding phone inquiries or helping put out fires caused by poorly trained employees.

Doesn’t this mean the firm is billing fewer hours to the client? Why is the firm investing so much time and money in a project that will make clients rely less on lawyers? Ask these firms, and they’ll tell you: “It’s what the clients want. It allows them to meet their business needs.”

And that’s what lawyers must now sell: client empowerment. We must help clients, individual and organizational, to take greater responsibility for their legal lives — to develop “good legal habits” that prevent problems from developing. Doctors don’t just cure patients; they help them develop regimes to stay healthy in the first place. Why should lawyers be different?

Clients are ready to take more responsibility in their encounters with the law. Help them do that, and you’ll never want for work.
This post first appeared as the editorial in the October/November 2007 issue of National magazine.