In our COVID-19 Recovery Playbook, we provided our thinking for firm leadership on how to manage through the current crisis. In this four-part continuation of that work, we examine where and how the industry may be shaped by the current health crisis facing the world. In Part 1, we present some thoughts on the types of trends and changes that the crisis has the potential to create in society, and by extension, the legal profession. In Part 2, we look at how client demands might change in light of this pandemic. In Part 3, we look at how these trends might affect the commercial law firm platform. Finally, in Part 4 we discuss how any firm might better prepare itself to weather future “Black Swan” events while coming out the back end in a healthier and better economic position.
In the second installment of this series, we introduced a number of potential trends that might emerge broadly from the client base of commercial law firms. We want to now shift our attention to trends that might emerge directly in and around the law firm itself as a result of Covid-19 – either directly on the law firm or indirectly via clients. We grouped these trends into four broad impacted areas – economics, platform, talent and culture, as shown in the following figure:
We begin with economics because in many ways economics are critical. If the firm can’t handle the economic changes, it is unlikely to get to the rest of the challenges. In the short term (which corresponds to the early stages of our Recovery Playbook), economic conditions tend to drive most decision-making. Longer term, we look at trends around economic factors and how they might change, and the implications of those changes for law firm management and operations.
Platform and Operations Considerations: For simplicity we capture a wide range of changes under “Platform and Operations,” including technology, space, support structures and others.
Talent Considerations: Law firms have sometimes been described as a collection of talent that voluntarily reassembles every day. To the extent material trend changes impact the law firm, the nature of the talent needed, and how that talent base comes together and unites to deliver client services will change. Here we include some potential shifts around the law firm talent base.
Cultural Considerations: Here we include a wide range of topics around how people work and behave. The triggering trends are cultural in nature, while the changes might be described as talent oriented, or even operational.
Overall Changes in Legal Business Model
If we pull all of this together, what differences might we expect to see in the legal industry a few years out? Obviously, the answer depends more on how the pandemic ultimately changes society than it does on targeted changes to the legal world specifically. If we make the assumption that the societal level changes are profound, then the corresponding impacts on law will be equally profound.
If we think about a world where COVID-19 has significant and permanent effects on our social, political, cultural and economic norms, we can envision a legal industry that adapts to incorporate and account for those changes (as it always does). However, that does not mean that every firm will change in precisely the same ways – in fact, we would anticipate the opposite, with increasing diversification of the legal business models used, with some approaches having more lasting impact than others. Some of the general changes we would anticipate happening include:
Ten years from now, law firms will still look a lot like they do today, at least to outside lay observers looking at their websites and public sources of information. To the trained eye, however, their supporting functionality will have changed dramatically, their competitive worlds will have evolved rapidly, and their leadership ranks will have turned over almost entirely from the “baby boomer” generation still largely in place today. How clients and their law firms work together will likely be different in material ways. Some of this will happen no matter what, but if our overall society is reconfigured by the current pandemic, the changes in law will be equally profound.
In our final installment of this series, we will focus on how law firms can rethink their strategic, management and leadership approaches to better position themselves to respond differently to future crises and emerge from them in a better strategic position than the starting point.