The End of Alternative Fee Arrangements?


Are alternative fee arrangements a relic of the past? After being on the scene for barely two years are they bound for the trash heap?

The answer is resoundingly no. Rather, the market is requiring smarter and more collaborative fee arrangements. The market is also saying that meeting the need for continued reductions in the legal spend is not the sole province of AFA’s.

With the continued reduction in the legal spend, lawyers need to figure out how to deliver more service, higher quality at lower fee structures. Lawyers need to create new efficiencies; they need to learn to work differently. They need to learn to work more collaboratively.

Increasing amounts of work are being sent offshore and law firms as well as general counsel need to develop collaborative working arrangements with these LPO’s.

But, the real key to survival is ongoing collaboration and communication between counsel and client. Lawyers can’t just wait for the client to provide feedback. Most of the time you just won’t get any. A lawyer’s fatal mistake may just be assume that getting a new case from a client is positive and productive feedback. If you do that, the flow of new work may trickle to a halt and you won’t even realize that you have been given negative feedback, until it’s way too late.

Five significant firms failed in 2011. More will crumble next year. As Smokey the Bear says, “only you can prevent a forest fire.”

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Jerome Kowalski
Kowalski & Associates

Jerry Kowalski is the founder of Kowalski & Associates, which provides law firm management... View Profile »

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