Law Alliance NZ (LANZ) is an association of independent legal practices, with member firms located throughout New Zealand providing specialist legal services in almost every aspect of law.
Law Alliance NZ (LANZ) is an association of independent legal practices, with member firms located throughout New Zealand providing specialist legal services in almost every aspect of law.
In this article, Simon Tupman urges law firms to innovate if they want to emerge as the new front-runners from the current economic downturn.
These are exciting times, for lawyers and law firms. Yes, exciting. Perhaps not the first word that comes to mind for many managing partners at the moment, given the downturn in business and the consequential squeeze on law firm profits. Yet I do believe that this slowdown is a blessing in disguise for many firms of all sizes and in all locations, providing them with the impetus and the incentive to really think differently about their businesses and to make lasting changes so that they can emerge from this downturn stronger, leaner and more effective than before.
Economically, this recession has created some novel and pressing problems for firms, notably the shrinkage of work in some core practice areas leading to salary caps, cost cuts and redundancies, particularly in the UK and US on an unprecedented scale. While such measures may be necessary and even desirable, (and not just to preserve the profits of senior partners and appease the banks!), they do little to address the underlying workplace 'disfunctionalities' that have hampered progress in law firms for many years. Some of these are attitudinal, some behavioural, some systematic and are epitomised by lack of leadership, under-delegation, non-communication, archaic or non-existent business practices and myopic pricing and productivity measures governed by the insidious billable hour. In these areas, compared with leading edge businesses from other sectors including some professional service firms, the legal profession has been in recession for years.
What is needed now is fresh, proactive thinking rather than just reactive cost cutting. This is a perfect time for firms to innovate; in other words, to introduce new ways of doing things so that their practices will not just survive this downturn but thrive beyond it, This will require lawyers and law firm leaders to be open to new ideas and to challenge any assumptions that they may hold regarding their legal businesses and the delivery of their services. Thinking deeply about what you are doing and how you are doing it will help you to ask better questions, break out of fruitless or meaningless routines, forge stronger relations with clients and staff, make contacts with new businesses and experiment with fresh ideas.
As Edward de Bono, regarded as the leading authority in the field of creative thinking and innovation writes, 'Traditional thinking is all about "what is;" future thinking will need to be about what can be.'
It is encouraging to see that, in recent years, there has been evidence of increasing innovation in law firms globally. Already some firms have been recognised for their efforts and (at least) two bodies are doing their bit to encourage more firms to take up the challenge:
Since 2006, The Financial Times in London has sponsored the FT Innovative Lawyers Awards (http://www.ft.com/pp/innovativelawyers2008) to coincide with their annual special report on law firm innovation. This year, the awards will recognise innovative European private practices and in-house lawyers. Categories include innovations in legal expertise, management, resourcing, client service and billing and fees.
Since 2004, the College of Law Practice Management, an honorary worldwide organization that encourages creativity in law practice management. (http://www.innovactionaward.com/home.php) has hosted the Innovaction Awards. For the fourth consecutive year, the InnovAction Awards have recognized outstanding innovation in the delivery of legal services, demonstrating to the legal community what can happen when passionate professionals, with big ideas and strong convictions, resolve to create effective change. Firms anywhere in the world are encouraged to enter. Cut off date for entries this year, 2009, is June 1.
As the Innovaction website reports, one of three winners last year was Australian firm Mallesons Stephen Jaques which was honoured for an innovation called 'PeopleFinder', the technological spearhead of 'ClientFirst', a program of continuous improvements to the firm's standards of client service. PeopleFinder gives individuals who contact Mallesons using a BlackBerry the ability to determine whether the person they're calling is available, and if not, when and where they can be found. PeopleFinder has rerouted more than 10,000 phone calls per month from voice mail to a person who can provide assistance.
But innovation is not the preserve of large firms; nor are all innovations rooted in technology. Alan Lewis, Head of Employment at George Davies (http://www.georgedavies.co.uk/about/index.htm) Solicitors in Manchester, England recently he took an innovative but simple idea from my book 'Why Lawyers Should Eat Bananas' (idea #5 – Host a Scenario seminar) and wrote to me subsequently explaining the outcome:
"We gained a new client with major restructuring issues worth lots of fees to my firm within 24 hours after their attending both sessions. Not only that, feedback from attendees is very impressive. Relationships with existing clients who came along have been greatly enhanced. This really was a simple and fun exercise to prepare and present. I feel we have a winning blue print for future seminars and I know that none of our regional competitors is doing anything like this."
The point is this: Alan read about an idea, saw its potential value and experimented with the idea to great effect. Not only did he position his firm differently from its competitors but also he won new business as well. That is what innovation is about.
Thinking and talking about innovation will not itself make you innovative. As Canadian innovation specialist Ed Bernacki writes, "Innovation is a lot like physical fitness. Talking about it will not make you fit, nor will investing in a pair of running shoes. It's how you use the ideas, the technology or the resources that makes you innovative."
Other reported examples of recent law firm innovations include:
Forget swine flu'. Consider how you can infect your firm with 'innovation fever'.
There is an old saying that says 'there those firms who make things happen, those who watch things happen and those who wonder what had happened'.
As I finished writing this article, I received a call from a Practice Manager of a provincial law firm in New Zealand. She summed up what is, perhaps, the main challenge in all of this and that is the self-perception that lawyers have of themselves. She said, 'They see themselves as lawyers, not business people; but unless they start to think of themselves a business people soon, then a lot of them could be left to reflect on what happened!
© Simon Tupman 2011