The future of the legal industry isn’t what it used to be. Or so says a report issued by Law2023.org, a group of industry insiders -- including this writer -- who spent a year studying the trajectory of the legal marketplace. The approach and the findings are surprising in a number of ways, but also refreshing. The future presents both disruptive change and extraordinary opportunity, for both incumbents and newcomers. Most views of the legal industry, particularly those posed by insiders, naturally adopt an inside-out approach, or, in other words, an approach that assumes the industry will have a say in how the future develops because we can see it coming. However, reality often presents obstacles or opportunities that are unforeseen by those deep inside. New entrants to evolving markets often have very different perspectives, unaffiliated with the status quo, allowing them to create disruptions and carve out new opportunities. But even this approach assumes there’s a clear view of the future, with different parties simply having different vantage points. What if we ignore the current state and look at the future under a different lens, envisioning how global economic, technological, and cultural change will be manifest a decade from now, and then envision a law firm built to address this world?
The group of legal market insiders, including lawyers, law firm managers, consultants, and legal service provider executives, led by the experienced provocateurs at Insight Labs, interviewed numerous experts in a variety of fields, including technology, design, economics, culture, and, of course, legal innovation. Their collective insights described a future that builds on today’s trends, with a recognition that each trend influences, and is influenced by, the others. Here are the findings.
Technology will enable lawyers to bill for real value. Many law firms embrace technology, but not typically as a means to drive efficiencies. A substantial component of lawyering is knowing where to look for an answer amidst a cacophony of sources, say, finding a relevant regulation or law. Another is knowing how to address a situation that others face infrequently, such as incorporating the right provisions in a contract. Powerful new technologies will make this information far more accessible, and some law firms will incorporate these tools to provide high-demand answers at a much lower cost, potentially broadening their offering and client base while generating handsome profits. Other law firms may eschew these services and focus on premium services where clients require creativity and imagination, and are willing to pay for it. New technologies themselves will present new legal frontiers, as with driver-less cars.
Firms will develop offerings that transcend jurisdiction. Globalization is gaining momentum. Businesses have to navigate a maze of laws and regulations, and increasingly will have to choose among them. Advising a global business means not only staying abreast of all of these jurisdictions, but offering counsel so that clients maximize their opportunities. Just as businesses today adopt structures to address taxation concerns, they will face similar choices based on various jurisdictions’ approaches to environmental, trade, labor, IP protection, and other practices. Furthermore, as businesses continue to operate more globally, rather than as national businesses selling to global markets, governments and regulatory bodies will need to adapt, and it will require top legal minds to ensure fairness in the global arena.
Demand for responsive institutions will create new markets for accountability. Citizens, armed with technology, demand greater transparency from businesses and governments – many of whom are caught off-guard when their practices are exposed and questioned. In a world influenced by Wiki-leaks, institutions will need not just good public relations, but they’ll also need new tools to remain credible and trustworthy. This mindset, often referred to as the “triple bottom line,” factors social and environmental results alongside financial performance, and influences businesses and governments to operate in a sustainable way in the markets and communities they serve. Law firms can help not only help repair trust in other institutions, they can do so not merely by erecting walls around institutions’ secrets but by developing policies and practices that help these organizations remain transparent and credible.
Firms will tap new talent and enable new pathways to practice. Just as many businesses have adapted to a world of cultural and demographic diversity, a remote or far-flung workforce, an increasingly mobile and younger workforce – even as their markets demand faster responsiveness and capacities – so will law firms. It has always been true that relatively few lawyers achieve the status of Biglaw partner and yet the culture within many law firms assumes this is the ideal objective. As law firms embrace different operating models, it becomes less important to adhere to outdated standards of what it means to be “in the office” and more important to deliver quality work in flexible ways. Global clients with diverse footprints are increasingly urging law firms to mirror these ideas. Some work will be delivered by non-traditional roles, and roles like project managers, client managers, analysts, and others will become more common in the delivery of legal services. And quality will not be singularly associated with the partner track. Excellent lawyers at all levels, with different approaches, with varied compensation plans, and with flexible workdays that don’t revolve around a central office, will be considered mainstream.
Transparency will push firms to seek hyper-specific markets. One great challenge in today’s market is differentiation. Many firms offer numerous services, but it’s improbably that they deliver all services equally well. With transparency, particularly in the form of clear, universally accessible metrics, will present new opportunities. It will be far easier for clients to compare the relative expertise of numerous firms, and combine this with information about costs, service posture, delivery approach, and diversity, to select the appropriate firm. Rather than serving all needs for all clients, law firms will be incented to specialize in more specific areas, at once enriching their domain expertise and opening up new markets for their services. Deep subject matter expertise will be more widely exposed, so firms will generate and benefit from client interest far outside their traditional geographic boundaries. This will also decouple the notion of firm size as an indicator of expertise.
Firms will launch R&D departments to create new offerings. With increased access to and reliance on analytics, firms will be in a good position to identify trends and triggers, and offer proactive counsel to clients and prospective clients. And the delivery of legal services will benefit, as firms will focus on approaches that are proven to have a greater likelihood of success than throwing a lot of smart, experienced bodies at each client issue, and treating each issue as if it’s new and unique. For some firms, this mindset will lead to regularly launching innovative new services to address specific trends, many of these developed outside the mainstream legal practice so as not to be influenced by tradition. Whether the innovation refers to an immediate legal issue, the underlying business challenges, or even the delivery of the legal solution, firms can differentiate based on creativity. Some will use such creativity to pursue broad market opportunities; some will rely on hyper-specific understanding of a key issue and develop laser-focused but unique and premium offerings serving a limited number of very targeted buyers.
User research and innovation will shape client experience of products. Just as consumer-facing companies have broadened their approach beyond merely solving a problem to engaging the user so that the experience of solving the problem is appealing, law firms will finally learn how to place client needs first. Clients have long lamented of poor experiences with law firms, even while obtaining excellent outcomes. Law firms will recognize more explicitly the link between client satisfaction and repeat engagements, and even more so that satisfaction is as tightly linked to experience as it is to outcomes. Since it will be far easier to identify which firms have the relevant expertise to deliver the right outcomes, a key differentiating factor will be service. As this mindset expands, firms will seek proactive solutions and move up the value chain, as their counsel will help drive better business decisions, not just deliver better legal outcomes.
What will your future hold? Who knows. While it’s challenging to predict, and predicting the precise future of a specific market segment poses an even greater challenge, the Law2023 approach delivers some excellent food for thought. More details on this initiative can be found at Law2023.org.
Timothy B. Corcoran is the immediate past President of the Legal Marketing Association and an elected Fellow of the College of Law Practice Management. He delivers keynote presentations, conducts workshops, and advises leaders of law firms, in-house legal departments, and legal service providers on how to profit in a time of great change. To inquire about his services, contact him at +1.609.557.7311 or at email@example.com.