The 21st century law firm is undergoing unprecedented change.
Challenges include increased competition, 21st century clients, and generational differences to name a few.
Let’s look ahead to see what to expect in 2018.
Changing Business Model. What has always worked for law firms is not working as well as it used to. Adapt. Be flexible. Experiment with different options for your clients – try new ways to communicate, bill, and deliver services – and see what your clients like. Many successful businesses experiment with their business model until they find what works best for them. Then they build on the model. Most law firms adopt a model that was built decades ago and they continue to operate the firm the same way, regardless of whether clients like it, employees like it, or associate attorneys like it. When the model ceases to provide results, there is no enthusiasm for building a new model.
The idea of a nimble workplace allows you to seek new ideas, collect input from your lawyers and staff and experiment with your clients. After putting an experiment in place, debrief about the process and results. Ask yourself three questions:
- What went well that we should keep doing?
- What didn’t go well that we should stop?
- What should we try next time?
Practice Areas. According to articles and surveys by many of the top legal staffing companies in the U.S., hot practice areas include healthcare, corporate transactional law, intellectual property particularly as pertains to entertainment law and technology law. There continues to be a rise in cyber practices including privacy issues and data breach response. In North Carolina, real estate practices, both residential and commercial continue to be robust.
Legal Jobs. Special Counsel’s 2018 Salary Guide reports increased demand and competition for top legal talent. Firms are looking at creative ways to provide more perks to professionals including signing bonuses, relocation reimbursement and unique benefits
- The top non-traditional benefits are pet insurance, back-up or emergency child care, and credit union or loan access
- 35% of attorney placements are relocations and most involve a bonus or reimbursement of expenses
- The average signing bonus is $27,000, while relocation bonuses range from $5,000 to $10,000
- While there are plenty of lawyers in North Carolina, many firms are competing for top talent and that includes recruiting attorneys from out of state.
What does this mean for your firm? Strategic recruiting is important. If you have growth plans for your law firm or if you want to keep the status quo as senior lawyers retire, you need to have a growth plan in place. You should be working with the Career Services Department in our law schools, as well as connecting with legal recruiters. You should have a lawyer in your firm dedicated to strategic recruiting and they should have a list of recruiting tactics that include sponsoring events at law schools, participating in resume drops and student receptions, and offering internship or summer associate positions.
Transitioning Lawyers. As senior lawyers begin to consider their next chapter, the idea of winding down a law practice (for a solo or small firm lawyer) or succession planning (for larger firms) becomes important. A well-developed succession plan should take a few years to work through, at least 18 months. Don’t wait until your best rainmaker announces a retirement date six months away before developing a succession plan.
As a solo lawyer, you should consider the idea that your law practice has value and there may be a market to sell your practice. Attend a “selling your law practice” program or talk with Tom Lenfestey with the Law Practice Exchange (www.thelawpracticeexchange.com) about buying or selling a law practice.
Importance of Data. Managing your law firm requires you to know and use your data. Your accounting and billing software probably collects more data than you use. Use digital products to help you master the analytics that make your firm run. Keeping track and analyzing everything from hours on projects to costs of doing business will help you see the big picture of how healthy your law firm really is.
Artificial Intelligence. In recent years, artificial intelligence (AI) has made big strides. Cambridge physicist Stephen Hawking called AI “the biggest event in human history”. AI will impact the profession for years to come not only through enhanced technology tools, but as lawyers sort the many legal issues that will arise over time.
Alternative Legal Service Providers. While Legal Zoom might be the name we know best, Avvo has also launched their version of online legal services. There is more to say about online legal services than the scope of this article will allow. For some insight, visit Bob Ambrogi’s blog post, “Avvo CEO Says New Legal Forms Offering Will Help Steer Self-Help Consumers to Lawyers” – http://www.lawsitesblog.com/2016/04/avvo-ceo-discusses-new-legal-forms-offering.html. The post includes links to earlier posts, as well as comments by Avvo’s chief legal officer, Josh King.
The North Carolina State Bar Ethics Committee has established a sub-committee studying online legal platforms. The sub-committee has released two proposed ethics opinions. 2018 FEO 1 discusses an online rating directory such as Avvo, and 2017 FEO 6 discusses whether a lawyer can participate in an online legal platform such as Avvo Legal Services.
In response to the changes in the marketplace, Lawyers Mutual is hosting the first NC Managing Partners Summit, a program designed to help lawyers cope with the tremendous challenges facing firms. The Summit will promote learning opportunities for law firm leaders to build more profitable and sustainable law firms.
Our keynote speaker is Jordan Furlong, lawyer and leading analyst of the global legal market and forecaster of its future development. Jordan is the author of the Law21 blog, Evolutionary Road: A Strategic Guide to Your Law Firm’s Future, and Law is a Buyer’s Market.
Our agenda will include panel discussions on succession planning, transition and law firm growth; stories from law firms innovators; and strategies for law firms in combating lawyer impairment. For more information, contact Lawyers Mutual.
Camille Stell is the Vice President of Client Services for Lawyers Mutual. Continue this conversation by contacting Camille at [email protected] or 800.662.8843.