Many years ago at law school, teaching us how to run a law firm was not on the curriculum, neither was how to keep a client happy.
But I did get to memorise eight cardboard boxes of lecture notes on a variety of legal cases, legislation and court procedure and forms.
Life in the legal profession has been transformed in the intervening years with the customer now firmly at the heart of everything we do. And rightly so.
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Today’s legal market is being transformed with rapid changes in legal models of supply and new strategic client relationships emerging.
Total legal spend across the 海角视频 economy is growing but only slowly with meaningful growth hard to find and merger activity the story behind most of the bigger growth numbers reported.
Growth through greater penetration into existing clients and markets is the order of the day.
With more lawyers around than work, competition is fierce. Clients enjoy more choice than ever before and law firms are working hard to re-calibrate our offering to retain clients and to win new ones.
But it’s not simply a supply-demand dynamic. Clients, especially in-house General Counsel, are facing their own pressures – internal cost pressures on resources, of course, but perhaps more critically a need to re-align their legal support function more towards the strategic goals of the organisation, with an emphasis on value.
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Law firms must respond to competitive pressures with a strategic response focused on what their clients, and in particular in-house legal teams, actually need to help them achieve that re-alignment.
The temptation to simply reduce rates alone is not the response that’s looked for or needed now. It’s much more strategic and client focussed than that.
Charging hourly is on its last legs, but it’s not dead yet. Sensible as it might often appear the problem is that it doesn’t incentivise us enough to be more efficient and that understandably jars with buyers.
Fixed fees and flexible charging structures are of course quite common nowadays, but there is growing interest from clients to understand how things work in law firms “under the bonnet”.
Clients want to see and understand what our processes look like, where improvements can be found and in some cases what level of profit margin we get from them.
This big trend towards transparency is an added driver for law firms to carry out root and branch reviews of our systems and processes. Re-engineering around lean thinking and extracting efficiency gains in working methods and service delivery is just the start.
The real challenge is to manage change by collaborating around the needs of clients by exploring together the level of skills and expertise that must be maintained and developed, and the ability of systems and processes to deliver on outputs in service level agreements against a range of KPIs. There’s more to do too.
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In the world of energy where I practice, energy efficiency is the recognised key to unlocking the competing demands of sustainability, affordability and security of supply.
So it is in the legal sector, where process efficiency is the win-win in the client-advisor relationship.
Meaningful profitability gains today will not come from price increases or organic growth, but through efficiency gains – streamlined systems and processes, doing more with less, achieving economies of scale.
From the viewpoint of the in-house lawyer, this is a shared vision, and makes true collaboration between the in-house and external law firm teams, and value creation, a reality.
• Andrew Whitehead is senior partner at law firm SGH Martineau, leading the firm's Energy & Climate Change practice.