“Preparation is very important.”
“Albert Pujols, one of the best hitters in baseball’s modern era, used this four-word phrase to describe one of his keys for success. It is not overly complicated and it is easily understood. The fundamental quality of being prepared—of keeping his eye on the ball figuratively in addition to, in the moment, literally—held him in good stead throughout his career.”
What the experts are saying
Many of you have noticed the steady increase in the number of financial professionals projecting an economic downturn, This recent Duke University study reports a significant majority of corporate CFOs expect the next recession to start no later than the third quarter of next year. Those projections, as well as other indicators, lead me to believe that law firms are on the lip of the same (or worse) economic challenges as was experienced in 2008-2010.
What to expect
As the absolute volume of demand for legal services is likely reaching a peak, the strongest firms will continue to adapt and move “downstream” — infringing on market share once the purview of small and midsized firms.
Inflation adjusted costs for law firms (as is the case in almost any business) will continue to increase at a slow but steady pace.
At the same time, alternative service providers will continue to take a growing slice of what was the legal service pie.
The combined result of the above is that economic pressure on law firms is poised to jump for all but the most valued, established and strategically positioned.
Without respect to successes of the past, the market is sending clear signals to any law firm not following a strategic path: it is time to stop and reassess how your firm fits into the competitive landscape — and tune-up appropriately. If you haven’t recently evaluated your debt, space and people position, now is the time!