Measuring time by the billable hour has always been a
cornerstone of the legal profession – not only for charging
clients, but also assessing lawyer productivity and significantly
impacting compensation. Accordingly, when clients started to
question the billable hour, they raised concerns that have had a
revolutionary effect on the way legal work is done, measured and
valued. These issues are at the heart of how law firms do work for
clients and the methodology used to incentivize their lawyers.
How should law firms respond?
First, they should make sure that they are giving clients more
value for their money. For some clients, this may mean
complimentary seminars for their business leaders and the use of
office space; for others it may mean secondments to help address
gaps among in-house legal teams, or entering into creative
fixed-fee arrangements that permit ad hoc advice in key
Second, they need to be bold about re-thinking what they do. The
lawyers and firms that will truly excel in the profession are those
that will think creatively about the way they actually help their
clients solve problems. As a starting point, there are three
questions that lawyers need to ask themselves in dealing with
What problems do we help our clients
Who do we need to work with to solve
How can we do it most
Understanding Challenges from the Client's Perspective
Clients have always come to their lawyers for solutions to legal
issues. Increasingly, those issues have become more complex
depending on the nature of a client's business. Some of that
increasing complexity is because of changes to public policy
– for example, regulatory changes – while in other
cases it's caused by technological change or public
expectations about transparency and accountability.
The advent of social media has completely transformed the
management of reputation, branding and stakeholder relations.
Technological changes are disrupting traditional business models in
a range of industries. Clients still need legal advice first and
foremost, but more than ever lawyers must really understand their
clients' businesses, and the environments in which they
Who Lawyers Work with to Solve those Problems
Never before has playing nice in the sandbox been so important.
Many legal problems cross borders or have high-risk shareholder,
stakeholder and public relations implications that cause in-house
counsel a lot of anxiety. To be equipped to handle such matters,
lawyers can't work in a vacuum.
As a result, depending on the deal, case or issue at hand,
lawyers need to consider whether they need to bring in other
advisors to provide a client with a comprehensive solution. Such
advisors can include colleagues in other practice areas of the same
firm, and outside specialists like media and communications
specialists, government relations experts, forensic accountants,
consultants or other law firms.
Doing it All Efficiently
"Expensive". That's the phrase typically
associated with "lawyers". Add some more professional
advisors, and it only gets worse..... Lawyers must be pro-active in
developing workable cross-functional teams where tasks aren't
duplicated and time is not wasted.
Clients should never pay for duplication, so each member of an
advisory team (internal and external) needs to have clarity on
their role. Project management tools can be applied to create and
control budgets and costs and steer the work product towards what
the client wants. All the foregoing help to meet a client's
expectations and bring innovation to fee arrangements. Ongoing
communication among the team and with the client is key to
nurturing the trusted advisory role.
If law firms are to be prepared for this future of collaboration
and problem-solving, they need to:
Ensure that they truly understand the
industries in which their clients operate.
Develop effective relationships with
other professional advisory firms and be prepared to collaborate,
including by looking at alternative fee arrangements.
Reward lawyers who demonstrate the
skill set that fosters collaboration, both internally and
Lawyers need to inspire clients. The way of the future is
incentivizing lawyers to be industry-savvy, collaborative and
creative in their client focus. Like it or not, the revolution is
happening and it's up to lawyers to ensure that they are ready
and remain relevant.
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