If you are a legal marketer, legal consultant or law firm leader, you probably saw the writing on the wall in 2009. The ever-prescient Richard Susskind saw the writing on the wall in at least early 2008 when writing The End of Lawyers?, which was published in November of 2008.
Now law firm leaders admit to seeing it too. Altman Weil’s latest Law Firm Leader Flash Survey, posted last week, indicates that managing partners have changed their tune since 2009. Now, they believe that:
Price competition is a permanent fixture of the legal marketplace (92% today, versus 42% in 2009)
Legal work is being commoditized (84% today versus 26% in 2009)
There will be fewer equity partners in law firms in the future (68% versus 23%) and
Smaller first-year classes are a permanent trend (55% versus 11%).
This survey indicates [at least to me] that precedent-fixated lawyers must be smack in the middle of an experience before they admit what any other close industry observer who is not hampered by a law degree can see. Some fairly dramatic changes have been afoot in the legal profession for some four years now, but how pervasive and deep they are has been hard to ascertain: how much of the ‘changing law firm business model’ is real and how much just makes for good blog copy?
On May 21, Tom Clay, a partner and consultant with Altman Weil, traveled to the Legal Marketing Association’s Capital Chapter to clear up that question. I came away with the sense that what was dismissed as “hype” two years ago is gospel today. Richard Susskind accurately assessed the situation in The End of Lawyers?, and now law firm leaders are admitting they see it too.
The End of Lawyers? is a long and dense book, but it foresees a future in which the law firm model of five years ago is drastically different — with increased price pressures, competition, a different leverage model, etc. With the new Altman Weil survey, it seems that law firm leaders confess that Susskind’s imagined future is coming true, but they also admit that law firms have not yet caught up with the pace of change. When asked if their partners truly understood the changes facing their profession, the answers of law firm leaders were consistently a middling 5 or 6 out of a possible 10.
Somewhat surprisingly, Tom Clay’s advice in the face of a highly complex set of changes was fairly simple: law firms should invest in, focus on, believe in knowledge management as a way to lower the price of and ultimately compete for legal services in a brand new world.
We so often want someone to just give us the answer — just tell us what to do — rather than leave us to sort out puzzling change on our own. And there it is — at it’s root, we need to focus on knowledge management — capturing, categorizing and organizing the intellectual capital we expend on behalf of clients so that it can be recycled, reused and repurposed for other clients. This is a profession full of brilliant people — it’s time to figure this one out. What is your firm doing in the area of knowledge management? Do you know where to start? Are legal marketers a driving force in pushing this innovation? I hope so, and I’d like to hear your thoughts on what the future will look like for law firms.