LBC Wise Counsel

Wake up and smell the coffee

August 7, 2024

What do you imagine are the most important things that the world’s major law firms are grappling with at the moment?

The profession, we know, faces very many challenges: the liberalisation of markets where lawyers have previously had an effective monopoly; the industrialisation of legal advice and services; the fight for the best talent and the seeming indifference of that talent to the old style partnership model; and the end of the chargeable hour…etc, etc. All of the above, and many more issues besides, must represent a significant chunk of any internal dialogue on strategy.

And yet despite all the talk of change, if you walk into any major law firm today, what impression do you get? The comfortable, but not ostentatious sofas, the artwork on the walls and the very nice coffee do not suggest a profession in turmoil or one facing a major strategic shift. In fact the splendidly appointed meeting rooms and the attentive support staff suggest a quiet confidence and stability and the flat screen TVs and the teleconferencing in every room probably indicate investment and a decent margin on work in progress.

All in all, the impression one gets is actually not of great change to come, but of great confidence in how things are now.

Just recently I had a series of meetings in different firms and was able to compare the quality of their cappuccinos more easily than I was able to understand the quality of their respective strategies for change; and it made me think, “I wonder if things really will change? Have the commentators (me included) simply overstated the impact of the challenges facing the profession? Am I the one in fact that needs to wake up and smell their coffee?”

My honest response is that law firms who are not talking right now to their most important clients about how legal services might develop and change over the next five years are misguided.

The shift in power from law firm to client is significant; the appetite for change within clients is significant and the willingness to experiment is more obvious too. This isn’t a passing phase; this is a fundamental alteration of the way the market operates.

It almost feels that firms are choosing to ignore the evidence of an altering market and instead are relying on the fact that work is still profitable, not all clients are so demanding for innovation and not all partners agree anyway. As such it seems that it is just easier to carry on regardless, perhaps with a nod in the direction of change simply to placate the evangelist lobby.

I’m not sure this is a good analogy, but it reminds me of a friend’s attitude to smoking; he sees the “Smoking Kills” warning on every packet of cigarettes he buys; he doesn’t argue with the evidence that smoking shortens many lives – he is just willing to take his chances that his life will not be one of them.

The legitimate question that might be put therefore is why should anyone, and especially those of us who do not work in law firms, bang on about change. Law firms that want to adapt and move forward can; those law firms that choose not to change may or may not survive, but they are all grown-ups and they can assess the risks they run.

I think this is a fair enough point and as a result I will not criticise any firm for considering all the options and then reaching the conclusion that major change or even evolutionary change is not for them. However, I do think it fair to criticise firms that have closed their minds to the threats and the opportunities and especially those firms that challenge the evidence of change. So, partners protesting to me that “many of their clients want hourly based charging”, for example, is not proof that the change agenda has been over-hyped, although it might suggest that the risk of an ineffectual client is a bigger strategic risk to the firm’s stability than anything else.

More importantly, however, I believe the greatest shame is that law firms are not engaging enough with their clients to open up the dialogue about the future of legal services. I just do not see the quality of debate, the innovation or the open-mindedness to contemplate a new way of working.

In the end I suppose many will say that I should not be so exercised by the point; it does not much matter to me personally of course, as I am neither in a law firm nor am I a client, but I am concerned – in fact, bloody frustrated would be a better way to put it.

When I qualified as a solicitor in England and Wales way back on 16 February 1987, it was without a doubt one of the very proudest days of my life. I knew I had joined something special and important and I still value beyond words the rule of law, the role lawyers play in access to justice, the wisdom and professionalism of excellent legal advisers and the creativity and determination of a profession that still holds an ethical framework so close to all that it does. Yet the way I see it, in the next five to ten years we will concede ground to entrepreneurs who care more for profit than for clients and a great profession will struggle to compete without dramatic compromise in core values – what a great and awful shame that would be.

I have said many times that at this time of great change the profession must be the architect of a new way of working, not the tenant in someone else’s design. Would those partners who care about where the legal profession is heading please engage with your clients to work this out together. It does not have to be painful, but it will be different.

I have literally smelt your cappuccino; please now metaphorically wake up and smell the coffee.

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