Shift happens â even in law firms.Are you ready? Thatâs the question that kept surfacing at the ILTA09 conference last week.
Youâd have to be living under a rock not to have noticed the impact of the economy on law firms and their clients alike.Â Thankfully, ILTA09 didnât just remind us of the bad news all around.Â The conference did something more helpful â it provided information and real examples of how lawyers and technologists around the world are rising to the challenges of the shifting landscape.
While Iâve provided some fairly detailed reporting of several ILTA09 sessions during the course of the past week,Â I want now to take a step back and try to convey some general themes that emerged across sessions.Â My first focus is on delivering value.Â This theme was launched officially with a keynote address by Richard Susskind entitled, âThe End of Lawyering?â.Â Over the course of his keynote address and panel presentation, he made the following points:
At a later session, Fred Krebs (PresidentÂ of the Association of Corporate Counsel in Washington, D.C.) spoke about the ACCâs Value Challenge, which is based on the premise that it is the clients that define what constitutes âvalueâ in legal services.Â He started by pointing out that while overall costs to corporations have increased by 20% during the past 10 years, their legal costs have risen by 75%.Â In order to address this imbalance, the members of the ACC have issued the Value Challenge to counteract what they describe as the âperverse incentives of the billable hour.âThe Value Challenge aims to help corporate counsel manage costsby increasing transparency in the process for setting prices for law firm services.Â Their hope is that this will bring about more efficiency and cost predictability.
Moving from theory to action, we then heard from some firms that were taking concrete steps to address the new economic realities.Â Onefirm that has moved significantly down this path is Bryan Cave.Â As John Alber and Connie Hoffman told us over the course of two sessions, they have spent significant time analyzingtheir services and business processes and now believe they know what it really costs to deliver services to clients.Â With this data in hand, Bryan Cave canmodel the impact on price by changing the components of service (e.g., what happens if you change the staffing?).Â Along the way, they created an online tool to help with this analysis andthen licensed that tool to Redwood Analytics, who now provides it to other firms.Â (This is another example of what Susskind calls âmaking money while you sleep.â)Â Bryan Cave has also rethought how to conduct adue diligence reviewand created an online tool that streamlines the due diligence process.Â They have been able to push due diligence work down to less expensive personnel while ensuring quality through atraining component embedded inthe tool.Â In addition, they are providing transparency by allowing clients to obtain reports on demand regardingthe process and cost of the due diligence effort.
On the subject of transparency, Mallesons in Australia has blazed a new trail with Mallesons Connect.Â As described by Gerard Neiditsch, this new extranet application gives clients real-time information regardinglawyer activity, progress against project goals, and fees incurred.Â Â It also provides information on billing history and outstanding invoices.Â In the process, Mallesons learned that this transparency can have unexpected benefits.Â Besides keeping everyone accountable, Mallesons discovered that once their law department clients saw the invoice information, they were able to expedite payments.
If your firm would like to rethink how it delivers value to its clients, the panelists advise you to start by analyzing your business processes.Â Using a simple Gantt chart,Â identify the components and dependencies of your process.Â Once you really understand the workflow, introduce simple technology to help automate parts of the process.Â If it works, extend it.Â If it doesnât work, learn from it.Â Throughout this process, however, donât forget the advice ofSteven Levy, as quoted by one of the panelists:Â âTechnology cannot replace thinking. Automating brokenprocesses wonât make us smarter; it can make us stupider faster.â
For more information on delivering value to clients, see the following resources:
Andrew McLennan-Murrayâs summary of Richard Susskindâs keynote and panel presentation.
Susan Jacobsenâs post on the the ACC Value Challenge session at ILTA09.
ACCâs resources on Leveraging Knowledge, including specific measures taken by various law firms.
[Photo Credit:Â dasmart]