Let’s start by defining terms. There are a number of characteristics that might be used to bring definition to “potential” – size, profitability, locations, and so on. But, for purposes of this discussion, I define it as achieving the professional goals of the firm’s professionals. If, over the span of a career, the
“When a law firm embarks on a plan to grow, ultimate success … [directly relates to] leadership’s ability to make the right decisions while navigating the high seas of growth.”
from Decisions That Matter: Tales of Law Firm Leadership in Moments of Consequence
It is not unusual to hear “Growth” as the response when law…
I have been preparing for a managing partner leadership conference. One of the topics I am discussing is law firm Key Performance Indicators “KPI.” In reviewing recent articles and posts on the issue I was struck by two things:
- the disproportionate representation of relatively short-term performance snapshots; versus,
- the almost total absence of the two
As more law firm mergers are announced, the idea of pursuing a merger crosses many a law firm leader’s mind. The idea of grabbing greater market share, entering distant markets, bolstering capabilities, or addressing succession can spur thoughts of combination. Those potential results or outcomes can seem compelling and cause a firm to jump into…
I was very encouraged by a Bloomberg article regarding Katten Muchin Rosenman. The piece describes the strategic priorities of Roger Furey, the chair of the firm. The three top priorities are:
- Getting the word out regarding the firm’s reputation. Reportedly, the firm has an excellent reputation with existing clients and the goal is to make the broader market more aware of this.
- Determine what the firm’s clients view as their needs. As is the case with all firms (or for that matter, any service related business), understanding the needs of clients — learning directly from them about what they are thinking and what they need — will allow the firm to better serve them (and when done properly, almost always result in organic growth).
- Attorney development. The firm intends to better use its more senior lawyers to enhance the capabilities of its more junior lawyers.
I am interested in the interaction of a group of people who have a common goal, or a common obsession, each contributing something unique to make something greater than the sum of its parts. I don’t know why, but from day one, that has interested me. – Steven Van Zandt, Bruce Springsteen’s E Street Band
The recent news of departures from Carlton Fields Jorden Burt is most interesting. The firm, was the product of the 2014 merger of Tampa based Carlton Fields with DC based Jorden Burt. At the time of the merger the synergies between the two firms was promoted as one of the real selling points. Now, 5 years late, at least 30 of the 48 original Jorden Burt partners have left, including name partners Jorden and Burt.
Every institution is vulnerable, no matter how great. No matter how much you have achieved, no matter how far you have gone, no matter how much power you’ve garnered, you are vulnerable to decline. There is no law of nature that the most powerful will inevitably remain at the top. Anyone can fall and most eventually do. –Jim Collins
Jim Collins, the author best known for his positive and uplifting books Good to Great and Built to Last, wrote another provocative volume in 1999. How The Mighty Fallwhich looks at the causes and stages of organizational decline.
It can’t be overstated. The legal services business is experiencing dramatic change. For law firms as institutions, it is obvious because more work than ever before is brought in-house by clients, and alternative service providers are rushing into the competitive landscape. Besides the increase in competition, there are technical and practice advances that have changed the way law firms do business. Legal project management, once a novelty, is altering the focus law firms are expected to bring to a task. Technology in law is evolving so fast that even law firms committed to investing in new tech have a hard time keeping up. And artificial intelligence is finding its place in the ultimate objective of meeting the legal needs of clients.
With all the industry change, most firms know that settling on the status quo is risky. Still, more than a few firms are slow to change. Some are overwhelmed by the idea of innovation itself or are worried about the appropriate time and capital to invest in its execution. Without adequate experience or guidance, a firm can be paralyzed.
Despite the seemingly “good” year that 2018 was for many law firms, experience tells us that ”good” can be a relative thing. While 2018 performance data compares favorably to the data from the prior years following the Great Recession, all is not completely rosy. Today’s law firms face more competition than ever as market share is shrinking, and the industry is being disrupted in multiple ways.
The recently released Thomson Reuters State of the Legal Market 2019report provides some industry information about how the 2018 results should be viewed. The report concludes that despite good results last year, a robust round of “high-fives” should be tempered. As Thomson Reutersnotes, shared competitive industry information, technological advances, client control of legal service use and terms, greater competition among law firms and other resources, have all greatly altered the legal services market. This change in landscape has, among other things, stimulated a war for talent, causing valuable lawyers with valuable clients to move from one firm to the next in free-agency run wild.
Law firm leaders understandably see lucrative client work as an important key to overall firm profitability. Left to their own devices, those leaders would eagerly raise rates or otherwise take steps to ratchet up the yield on work. In contrast, their clients often consider the containment of legal costs as a key component to valuable…