The Greek philosopher Plato once said that "out of necessity comes invention" and out of invention derives innovation. HBA Legal looks at the current legal landscape and the increasing demand for law firms to innovate in order to stay competitive.
Change and innovation: what lawyers fear most
The practice of law has remained relatively untouched over the last century.
Why this lack of change? While lawyers may aspire to change, there are mental barriers instilled into the structure of the profession.
Innovation is risk. Risk instigates evolution. Lawyers, by nature are one of the most risk-averse professionals out there. Many lawyers have a fear of change and a fear of failure. It is widespread and genuine.
The new ruthless push towards cost-effectiveness in the legal market has placed great pressure on law firms, some adopting new-found technologies to make themselves seem more efficient. When asked, law firm leaders consider the biggest disruption to the future legal market would be technological innovation. But is that really the case?
The use of technological innovation has been seen as a means to an end rather than an aspiration. As technology improves we will be able to produce reports faster, but our upmost concern must be with quality content and creating reports that genuinely add value to the client.
Partners of law firms who want to foster innovation should ask themselves – do clients want to see innovation, or do they just want cheaper services? What if there was a way to meet both challenges?
The Lean phenomenon
Six Sigma is a management strategy that emphasises process quality and the removal of discrepancies and flaws from products and services. Developed by Motorola in the mid-1980s, it was initially used in manufacturing before being tailored for use in many other industries over time. 'Lean Six Sigma' ( 'Lean') is the child of both Lean manufacturing and Six Sigma methodologies.
Lean aims at enhancing process speed and quality by cutting back on process wastes. Its intention is to remove the waste to focus on the processes that add value. Law is a service and like all services, opportunities for waste flourish. Lean provides lawyers with a route to navigate the shifting legal market we face today.
The challenge for many firms is making the transition away from a traditional law firm culture ('OldLaw') towards new methodologies ('NewLaw'). Applying Lean within the law firm will translate into improved efficiency and productivity and, clients will see a better, faster, value-adding service.
Putting Lean into practice
For decades, lawyers have charged their clients high hourly rates for legal services with no incentive to be efficient. However, in the past decade, clients have started to treat legal services the same as any other purchased service. Clients now demand a lot more for a lot less. Law firms must understand this.
Just as a screwdriver solves a different problem than a hammer, the same applies in law. However, law firms do dozens if not hundreds of repeatable processes every day. Lean's tune of 'doing things better' denotes that it is essential for firms to consider it from a cultural outlook. That is, it has to be more than an arbitrary process, and actually be entrenched in the firm's culture for it to work from a grassroots level to the most senior partner. All personnel at a firm – not just lawyers – must be reminded of the need for efficiency and to prioritise the client customer.
Today's law firms must develop and employ strategies and tactics based on the client's perspective. What we must grasp is that client is unique. Lean is but one way to help deliver more for less. Approaching a system like Lean and utilising it with the right mindset can produce success and position firms with a competitive advantage.
Firms and adhering to traditional ways and refusing to adapt will face inevitable doom when clients come knocking for better ways of doing things.
Will law firms adapt or become an endangered species? Mitch Kowalski, a front runner in the NewLaw movement, shares his vision on that question in his book, Avoiding Extinction: Reimagining Legal Services for the 21st Century, with his prophetic character saying:
"firms that do not change their business model and embrace innovation are dousing themselves in gasoline and marching along a burning platform to their own destruction."
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