If law firms are to survive and thrive, they must dramatically modernise the way they work and serve their clients; they must become more adaptable, flexible and collaborative if they are to prosper. While clients have accelerated and evolved in their respective sectors, the legal industry itself has failed – at best to keep pace – at worst to change in any meaningful way. Either way, law firms remain significantly and meaningfully behind the curve.
Covid-19 may be the disruptor the legal industry has long needed, sparking change and generating the long-awaited revolution. If so, how will these changes manifest? And how do we create the blueprint for the modern law firm?
How we value our services
For many decades, lawyers have valued their services with reference to the number of minutes spent thinking about and working on a matter; time is the value proposition, rather than the outcome. While this may have been effective and acceptable 25 years ago, we have failed to adapt and deliver a true value-based proposition.
The fee model is outdated and increasingly out of step with client needs. The legal profession remains one of the few areas of business that is wedded to charging by the hour, yet the societal shift that is taking place suggests the value of time is increasingly more important than the time spent. It’s about what and how you deliver rather than the quantum of time. This will require law firms to re-think how they deliver value and price their services. Incremental changes are no longer adequate; valuing our services by the hourly rate needs to be abandoned. Rather, we should price by way of the true value we deliver to clients. Just as investment banks price their services on the achieved deal, so should law firms; litigators need to price on outcomes rather than the hours plodding through the process. In this way we will finally be truly aligned with our clients. Let us tear up the rule book.
At Boies Schiller Flexner we spend time listening to our clients’ needs around fees – whether it be certainty, skin in the game or flexibility. We then craft a bespoke menu of fee options specific to the client and matter, designed to ensure our respective interests are aligned.
Rethinking the one-stop law firm
This also chimes with how clients are increasingly using law firms. The one-stop law firm upon which so many firms built their model in the 1990s and 2000s is losing its lustre. Sophisticated clients increasingly unpack legal services to receive the best expertise in different areas. They choose one firm for financing requirements; another for corporate work and yet another for litigation.
This evolution will require law firms to ensure they have the best-in-class lawyers in all of their offerings and be willing to collaborate with other firms as clients cherry-pick the right lawyers to meet their objectives. As a leading litigation firm, Boies Schiller lawyers frequently co-counsel with the corporate, finance and restructuring departments of Magic Circle and leading US firms across the City. This trend is only set to increase.
How we work
Other key changes will happen within law firms themselves, generating a significant cultural and structural shift. Covid is sparking a major re-evaluation. Nearly every lawyer – across all generations – has adapted to working from home and it is unfathomable that we will return to the old order. This means workspaces will need to be completely re-thought; no longer can thousands of square footage dedicated to meeting rooms, in-house dining facilities and individual offices be justified. They are unsustainable economically and will be rejected by lawyers and clients, presenting an opportunity to change the working model.
Post-Covid-19, with heightened reliance on technology-driven services, it will be increasingly important that law firms are lean, nimble and capable of pivoting rapidly to meet changing markets. Huge overheads and real estate footprints will make this far more difficult to achieve.
How we use technology
Technology has shown itself to be a saviour, connecting us to colleagues and clients, enabling work to be executed seamlessly and with relatively little disruption. This has inevitably changed working patterns with people operating flexibly from home. While there will be a continued need for office space and face-to-face meetings, I can see a time when law firms adopt a more flexible model with employees booking desks on days that they need to be in the office. At the click of a button, technology such as Microsoft Teams and Zoom has also dramatically changed the way meetings are conducted across the globe, reducing the need for overseas travel and the world’s carbon footprint in the process. This will continue to be the norm rather than exception. And savings made on real estate can and should be invested in cutting-edge technology in the office and home working.
Innovation
Many law firms already have innovation departments, implementing artificial intelligence mechanics in research and document assembly, practice management coordination and predictive coding. This will inevitably have an impact on how work is researched, creating efficiencies and an evaluation of what support structures will be needed. As employees become more tech-savvy and self-sufficient, the traditional role of the legal assistant, for example, will need to evolve and diversify.
The drive for efficiency and structural change, better use of technology and the ability to be more fleet of foot in meeting client expectations are just some of the fundamental characteristics that will be the hallmark of the modern law firm.
Sheryl Crow sang, ‘A change would do you good’. That’s never been more true for the legal industry than right now. Creating the blueprint for the modern law firm will be an exciting journey that should be embraced rather than feared. Prepare for the revolution.
Natasha Harrison is co-managing partner and London head of Boies Schiller Flexner