I Ain't Gonna Play Sun City

I'm sure there are many people, particularly the younger generation, seeing their Tumblr, news feeds and Facebook walls blow up with Nelson Mandela tributes and who, while recognizing the name, still wonder what's the big deal. We've all read in our history books about some of the heinous treatment of one people by another and because these are history books we get the sense that by and large humanity has evolved past such acts. Sure we hear short snippets in the news of atrocities such as genocide, slavery and ethnic and religious purges taking place today, but they always seems to take place in far off countries and often among people that don't look or act like us so it feels pretty distant. Sadly, this is human nature. I grew up in era where Apartheid was legal in South Africa, and proudly so, at least as characterized by some of its country's leaders. While South Africa was far away and many of its people didn't look like us, many of the leaders spouting support for institutionalized hatred looked a lot like us and spoke our language on the newscasts. With the emergence of cable news and 24-hour news cycles, it was hard to escape the reality that people like us were still pursuing heinous policies against others. During my formative years apartheid moved from being a distasteful policy perpetrated in some far-off land to the forefront of our consciousness.

For many US generations, college has been a place where political activism takes hold and it's no coincidence that some of the most compelling moments in political protests, such as those against the war in Vietnam or those in support of Civil Rights, took place on college campuses. But my '80s college generation wasn't exercised about much. We complained about the labeling of "dangerous" music and our musical heroes produced music videos expressing fear of nuclear war, but for the most part our economy was humming along and we were apathetic. Until apartheid. I can't say that I joined marches or protests against apartheid because I don't recall any being organized at my school, but I can say we cared, and cared deeply.

There are no conversations as fascinating and wide ranging as those that take place in college dorm corridors at 3 AM, punctuated by kids who are invincible, who know just enough of politics and world events to be dangerous and who are still supremely confident that they have all the answers to solve the problems foisted upon us by earlier generations. We would debate apartheid and declare that had we been in charge we would never have allowed it to take root, and if we could have our way now we'd eradicate it, though we didn't know how. These conversations crossed racial, political and socio-economic lines, in part because many of us hadn't yet established our own personal ideologies and selected our lifelong news sources that would comfortably reinforce our own biases. From our business and economics classes we understood that the issues were probably more nuanced than "simple" hatred by one race of another -- and make no mistake, there were business and world leaders and emerging leaders of our own generation supporting apartheid at that time, or at least not condemning it because South Africa served their commercial interests. But for most of us, it was a black and white issue - pun intended, but no disrespect intended.

Our musical idols provided some measure of assistance, by refusing en masse to play Sun City, at that time popular stop on many global concert tours. And we radio station geeks would both play the relevant anthems ("Little Steven" Van Zandt and Artists United Against Apartheid "I Ain't Gonna Play Sun City" comes to mind) and refuse to play music from artists who continued to tour South Africa (I'm looking at you Elton John and Queen, among others) though admittedly our gnat-like memories faded when hot new songs by these artists were released. But to the extent we cared about global politics and human rights in that era, apartheid was the subject of our activism. And Nelson Mandela figured prominently in the conversation.

Mandela was released from prison after I graduated, and while the task of earning a living replaced my late night world-problem-solving discussions, none of us could help but be aware, and impressed by, the towering intellect, passion, strength and, yes, compassion, of this man who had spent nearly three decades incarcerated for his stand against his government's injustices. Let's ponder that for a second. There are notable movies illustrating how those incarcerated for long periods often struggle with returning to society. And of late there is a seemingly constant stream of wrongly-convicted prisoners released after DNA evidence clears them, typically years if not decades later, and unfailingly the vibrant young people who went to jail emerge as broken shells after a lifetime of imprisonment. And yet Mandela emerged with an unbroken spirit, ready to catalyze the movement to finally ban apartheid. He then led his country after an election in which he earned over 62% of the votes, one of the most stunning reversals of fortune I've observed in my lifetime. He did not act alone. There were, of course, many others, whose names won't be recorded in the history books, fighting apartheid. But Nelson Mandela is not, for me and for many (and hopefully most) of my generation, some distant history book reference; he's the embodiment of what one person can do to fight injustice on a scale that seems impossibly insurmountable.

For that, I am pleased to have been a witness. And I hope my daughters, nieces and nephew, some of whom are of mixed race, and others in the younger generations take a moment to study and reflect on Nelson Mandela's accomplishments (some already have). There's been some muttering about the disproportionate air time devoted to a popular film star who died tragically this week and what an injustice it is that Nelson Mandela's passing isn't generating nearly as much viral attention. I bear no grudge against the media, or the young film fans, who can't get enough news of their deceased movie star. But trust me, when all is said and done, Nelson Mandela, both his life and his passing, will have a far greater impact on our social consciousness than any other news we'll read this week. He was, and is, that important.

He had his failings, as we all do, and we'll begin to hear of his imperfections, and rightfully so. It's important to note that our icons put their pants on one leg at a time just like the rest of us, and have weaknesses just as we have. But that doesn't detract from what he accomplished.

Thank you, Nelson Mandela, for what you've done and for showing us how it's done. Rest in peace.

Timothy B. Corcoran delivers keynote presentations and conducts workshops to help lawyers, in-house counsel and legal service providers profit in a time of great change.  To inquire about his services, contact him at +1.609.557.7311 or at tim@corcoranconsultinggroup.com.

On Bullying

It's a relatively simple mathematical calculation to quantify the negative impact of bullies in the workplace, yet managers in organizations everywhere allow toxic behavior to persist. This week's object lesson comes from the NFL Miami Dolphins, where a professional athlete left the team due to persistent harassment and bullying.

While the full story is not yet known, there are certain unassailable facts: at least one protagonist with a long record of impulsive behavior has acknowledged coercing a teammate into contributing funds to a Vegas vacation, directing ethnic and homophobic slurs at this teammate, and engaging in physical and mental abuse, all in the spirit of hazing -- a long and misguided tradition of veteran players "riding" younger players. The protagonist is not merely a veteran teammate, he's also on the team's leadership council.

There has been a large public outcry leading to the suspension of the protagonist, the victim hiring a lawyer, and the team owner demanding a full investigation. Sadly, but perhaps predictably, the segment of sports punditry comprised of retired athletes has defended the protagonist thusly:  One can't possibly understand what goes on in a locker room unless you're part of the team; the victim walked out on his team during a competitive season, thereby revealing his true character; and the protagonist's actions were merely "boys being boys."

One retired coach called the victim a "baby" and waxed philosophic about "Back in my day when men were men..."  Others accused the victim of gamesmanship, suggesting his failure to report these allegations earlier and his supposed camaraderie with the protagonist demonstrates disingenuousness. In response, the victim acknowledged a fear of retaliation and the loss of his livelihood as reasons for not stepping forward earlier. We'll learn more as this story unfolds, but we know enough to recognize a hostile work environment. Why? Because nearly all of us have witnessed such bullying in our own workplaces.

In the corporate sector, the toxic personality often takes the form of a top-producing salesperson who breaks the rules, fails to properly document activity, over-commits the organization to meeting a client demand, and then bullies colleagues into delivering the impossible because, as the old saying goes, "nothing else matters until we make a sale."

It can also take the form of a long-entrenched manager who has watched leaders come and go, who has watched strategies come and go, who has watched competitors come and go, and all the while she's tending to the company's day to day needs. She truly believes her steady hand on the rudder is the primary driver of organizational success in an ever-changing marketplace, and so when presented with new and uncomfortable ideas her knee-jerk reaction is "We've tried that before and it didn't work. Next!"

In law firm land, the corollary is the toxic partner, that rainmaker bringing in millions in billable hours, or the long-established patron of the corner office whose reputation is unassailable and who can do no wrong. Whether the partner cycles through secretaries like others change their socks, or metes out punitive assignments to associates who fall out of favor, throwing tantrums in the office when the staff fails to read his mind or demanding that others adhere to stringent work requirements out of some vague allegiance to client service, these actions constitute a hostile work environment.

Worse, if the toxic partner is acting under the delusion that such actions will improve team performance, she or he is assuredly provoking the exact opposite outcome. We've all seen the feel-good movies where a tough-as-nails but kind-hearted leader drives his team to victory by forcing everyone to reach deep inside, to unlock that extra courage, to go that extra mile. And there's some truth to that, of course. Any coach knows that even high performers often need external motivation to break through barriers. But how much is too much?

The underlying math in any organization is simple, requiring us to balance the revenue generated with the costs incurred. But too often we fail to complete the equation, focusing solely on the revenue side. So the rainmaker generating millions of billables earns a free pass, or perhaps only an occasional private "talking to" when his conduct falls too out of line. But when we factor in the victims' lost productivity due to distraction or emotional detachment, the cost to continually recruit and train replacements, the sub-optimal work product that results from star performers avoiding collaboration with the toxic partner, the client defections, and more, this "total cost of ownership" will invariably tip the scales in the other direction.

There is NO financial reason to perpetuate a hostile work environment. There is ALWAYS a long-term loss in revenue and profit when such a situation is allowed to persist.  If you've done the math and somehow produce a result that says otherwise, I challenge your approach.

There are protections in place for whistleblowers for a good reason: people often won't speak up for fear of retaliation, because they fear the loss of their income and job security, because they feel they'll be shunned by colleagues for impairing the team's performance. Rather than discourage open talk, we should encourage it. If there's a toxic personality creating a hostile work environment in our workplaces, as managers and leaders we need to step up and address the situation directly and immediately. If you can't summon the courage to do so because it's the right thing to do, then take action because such an environment is unquestionably impairing the team's performance.

Why in the world would you take money out of your own pocket to reward some immature buffoon's temper tantrums or locker room behavior, when the alternative is to excise the annoyance and improve both morale and financial performance? Not every workplace has a toxic personality. But if you have one, or more, take action today.

Epilogue: The Miami Dolphins had a .500 record when the above incidents came to light, meaning their next game would literally put them on the path to a winning record or a losing record. The team lost its next game to a previously winless opponent.

Timothy B. Corcoran is principal of Corcoran Consulting Group, with offices in New York, Charlottesville, and Sydney, and a global client base. He’s a Trustee and Fellow of the College of Law Practice Management, an American Lawyer Research Fellow, a Teaching Fellow at the Australia College of Law, and past president and a member of the Hall of Fame of the Legal Marketing Association. A former CEO, Tim guides law firm and law department leaders through the profitable disruption of outdated business models. Tim can be reached at Tim@BringInTim.com and +1.609.557.7311.

Solving for Profitability

At a recent collaborative workshop between two camps -- in-house counsel and corporate procurement professionals on one side and law firm partners, finance and marketing professionals on the other -- we had a lively discussion about law firm profits. Most agreed generally with the view that a law firm has a right to profits, but the challenge arises when a law firm is extraordinarily profitable at the same time the client is extraordinarily unhappy with the value delivered. This scenario, one which resonates with many in-house counsel in recent years, leads to increased price pressure from buyers and over time this will depress law firm profits.

Predictably, in an effort to boost sagging profits some short-sighted law firm partners will make up for price pressure from one set of clients by raising prices for others, eroding the price-value connection for even more buyers, and accelerating this decline of profits. One in-house participant declared that he requires all outside counsel to submit profitability data and he'll decide what profit margin is acceptable! We can all empathize with buyers who are dissatisfied with the value received at the prices they pay for goods and services. But it's a stretch for the buyer to explicitly decide what profit the supplier should earn, in any marketplace.

So how can a law firm both enjoy a healthy profit and satisfy clients? If we adjust our lens a bit, it's not all that difficult - as with many commercial ecosystems, the pursuit of profit can best be maximized by delighting customers, and not as many assume by having one party win while the other loses.

Long Term vs. Short Term Profitability

Most law firm financial systems are structured to measure short-term profits, that is if there is any measurement structure at all. A surprising number of law firms do not explicitly calculate profitability, and many who do refuse to share these calculations with the partnership out of a misguided concern that it's divisive and corrosive to a collaborative culture. What's more divisive is a culture of not knowing -- which naturally leads to most parties making flawed assumptions about their performance relative to their peers. But the root problem is that without a clear understanding of what generates profits and what dilutes profits, no enterprise can sustain itself indefinitely because there will be too many factions working at cross-purposes. When everything supposedly makes money, then nothing makes money. And vice versa.

A focus on short-term profits drives and rewards the wrong behavior. Imagine a partner who sees an opportunity to bill a client $100,000 for a litigation defense matter, when that partner's experience could quite easily lead him to counsel the client that he's better off settling rather than defending, and thereby reducing legal costs by $50,000. Or imagine the partner who pads his own time and allows others to pad their time against the client matter, knowing the client will absorb some or all of these costs without complaint because, after all, "They hired us because we're the best and because we're thorough and they should expect to pay a premium for this."  In reality, clients are rapidly becoming more sophisticated and can incorporate benchmarking data from other matters and other firms to help identify the "right" price for legal services, and increasingly they know when they're being overcharged. This isn't unlike purchasing an automobile before ubiquitous internet research, when price shopping was logistically challenging and buyers expected the dealers to take advantage... and they did. When a buyer discovers he's been overcharged, he doesn't return to that merchant.  And therein lies the mathematical basis for focusing on long-term profitability instead of merely short-term profitability.

A law firm that calculates profitability as a function of maximum hours per engagement will, over time, as sure as the sun rises in the East, eventually experience client defections. Client defections (measured by retention rate) caused by over-emphasizing billable hours lead to three serious financial consequences:

1. The cost to acquire a new client is far higher than the cost to maintain or expand an existing relationship

2. The firm will price itself out of competitive bids

3. The firm will eschew efficiency and alternative fee arrangements and forgo potentially higher profits associated with these models. Success can't hinge on finding an endless supply of clueless clients, a task that gets harder every day.

If a law firm embraces a model in which long-term profitability is more balanced with short-term profitability, we will see changes in behavior and reward systems:

• Matters will be priced more competitively, because the objective is not only to win the work, but to also win subsequent work

• Matters will be delivered efficiently to maintain price competitiveness, and profiting from the learning curve is always more sustainable than profiting from high prices

• Satisfied clients not only stay longer (leading to higher retention rates), they buy more services (a.k.a. cross-selling, leading to higher penetration rates at a lower cost of sales)

• Satisfied clients insulate the firm from consequences of lateral partner defections. Even when a key rainmaker or service partner leaves, satisfied clients remain

• Lateral hires and new offerings measured for their contribution to long-term profitability will insulate the firm from making hasty and dilutive decisions, such as recruiting a lateral partner with an alluring book of billable hours but with high service costs, non-competitive pricing, and clients evidently willing to change firms at will

• Contributions from those involved with delivering high-quality legal services and managing valued client relationships will be more readily recognized, and the emphasis will shift from substantially rewarding origination to rewarding all steps along the supply chain. (Yes, it's hard to win new business, and this is why "hunter" salespeople are often highly-paid individuals in a corporate setting too. But those who make, manage and service the product lines are also essential to the sales and retention process. Missing this point is one of several extraordinary gaps in law firm management science.)

Organizational vs. Matter Profitability

To be clear, if we focus on long-term profitability and ignore the many short-term actions we take day in and day out, it's likely that we'll make many wrong and dilutive decisions. So there's nothing wrong with measuring profitability on a shorter time horizon too. Organizational profitability is typically the derived sum of individual matter profitability, often clustered within practices whose profit contributions are measured and compared.

Matter profitability, as we've described above, can be influenced by over-pricing.  Is it acceptable if we achieve a 50% profit margin on a $100,000 matter, but in so doing upset and lose the client?  Or is it better to achieve a 35% profit margin on a $50,000 matter, followed by a 35% profit margin on four subsequent matters, each acquired at no cost to the firm because a happy client simply assigned the work?  Similarly, who should earn the higher reward -- the rainmaker who brings in a $100,000 matter at 50% margin that keeps 5 timekeepers at 60% utilization for 3 months, or the rainmaker and timekeepers who convert a $50,000 matter at a 35% margin that keeps 10 timekeepers at 40% utilization for 2 months into four more $50,000 matters, each at a 35% margin and that also keep 10 timekeepers at 40% utilization for 2 months?

I know, the math is getting hard to follow.  The point is, sometimes the math is hard to follow so reducing everything to a single, simple point statistic like billed hours, and then basing all rewards and pricing on this one factor, is foolish.  Running a business is a bit more complex.  The many variables we've identified already include retention rate, utilization, realization rate, leverage, productivity, penetration rate, cost of sales, cost of goods sold, and more, and this is only a small subset of the variables available to managers who need to make rational decisions about the allocation of resources.

While we're at it, a few quick notes on the mechanics of matter profitability:

• Matter profitability and even practice group profitability ignores cross-pollination. One of my clients recognized that the Trust & Estates practice generated a significantly lower profit margin per matter than other practices and considered shuttering the practice. However, deeper analysis revealed that T&E clients, many high-net worth individuals like CEOs, were feeders to the firm's other practices, like corporate, securities and litigation. On an isolated basis, the numbers suggest the firm's T&E practice should be closed, or at least starved of resources in order to focus on more lucrative practices. On an aggregate view, however, there may be more investment needed in this feeder practice if this can be done at a lower cost than alternative lead generation activities

• Matter profitability often provides a false read because of improper allocations. One of the liveliest discussions in any business setting is how to allocate various costs to the business and to the various product lines. In a law firm, we can argue endlessly over whether to allocate costs based on headcount, or on a square foot basis, or on a consumption of resources basis, or other models. In many cases, the final tally isn't all that sensitive to modest tweaks in allocations, but the overriding imperative is to select a model and then stick with it for all, so it provides a sound and sustainable comparative measure

• Matter profitability shouldn't be diluted by productivity. Matter profitability should balance the revenue generated against the hard costs to deliver the matter, including the compensation associated with the timekeepers billing against the matter. But the compensation should reflect target hours worked by associates, or associate bands. While associates are not truly fungible, in this case we should view their contribution as an interchangeable raw material, so if we replace Mary with Carlton, the underlying cost structure doesn't change. Why? Because if we price our services efficiently based both on our organizational learning curve ("We can complete this task in 5 hours") and the client's perceived value ("This task is worth $3,500 to me"), then an individual contributor's productivity shouldn't have a material impact on our costs of goods sold. Said another way, clients resist first- and second-year associates working on their matters because of the assumption that associates work inefficiently as they learn their craft. By basing the price on a standard cost, we remove the client's objection. Some will complain here that more productive associates are penalized because they're placed in a box along with less productive associates. But productivity is a management issue, not a pricing issue. We don't pay more or less for light bulbs or automobiles or haircuts or vaccinations based on the training level of the person making the product or delivering the service. And legal services shouldn't be priced that way either.

• Matter profitability shouldn't be diluted by equity and bonus compensation. Partner time can be billed at actual rates rather than a target, if we choose, under the assumption that their variable billing rates already reflect experience and an experienced partner will bill 3 hours at $650 for a task that an inexperienced associate might bill 10 hours at $275. So a pro rata portion of the partner's compensation based on hours billed is a sensible cost to accrue to the matter. But it would be foolish to add in partner equity compensation, or bonuses for either partners or associates, as these costs have nothing at all to do with the matter! In fact, these costs would force the matter profitability to plummet, requiring the firm to significantly increase prices to make it profitable, which as we've described above serves to provoke the opposite effect, namely that no clients will buy any of what the firm is selling. Consider lawyer bonuses and partner equity compensation as SG&A to be addressed elsewhere.

Managing a law firm or a practice group is challenging enough without adding a lot of financial math to the mix. But the reality is that no law firm manager should be operating without a clear sense, or hopefully a directional sense, or at bare minimum a vague idea, of how resource allocation and pricing can influence the financial health of the business. Long-term profitability vs. short-term profitability, matter profitability vs. organizational profitability, allocations and overhead and leverage, oh my. Yes, it's hard. But I'm willing to bet that you have a resource on staff, or a phone call away, who can help you sort through these issues. The key is to establish a consistent approach across the firm based on the ideals of firm management. And these ideals should be established based on a fully-informed view of the alternatives and consequences. Welcome to management. No one said it would be easy.

For more information about the evolving state of law firm pricing, see Toby Brown's excellent "The State of Legal Pricing 2013."

Timothy B. Corcoran is principal of Corcoran Consulting Group, with offices in New York, Charlottesville, and Sydney, and a global client base. He’s a Trustee and Fellow of the College of Law Practice Management, an American Lawyer Research Fellow, a Teaching Fellow at the Australia College of Law, and past president and a member of the Hall of Fame of the Legal Marketing Association. A former CEO, Tim guides law firm and law department leaders through the profitable disruption of outdated business models. Tim can be reached at Tim@BringInTim.com and +1.609.557.7311.

Predictive Analytics - Gaining a Competitive Edge

Law firm leaders who embrace predictive analytics to manage their businesses and their practices can establish a sustainable competitive advantage over competitors who rely on gut instinct and sheer intellect to leader their enterprises.  There are multiple opportunities to employ predictive analytics in a law firm:  to run the business more efficiently and effectively; to pursue more lucrative clients and engagements; to recruit and train lawyers for success and longevity; and to practice law in such a way as to be a step ahead at all times.

Join me in New York or Boston as I discuss the role of Predictive Analytics in a law firm: Register 

Michael Lewis, in his book Moneyball, later made into a movie, uses baseball as a metaphor for the power of predictive analytics.  Many people assume the book is about baseball.  In fact, baseball is just the setting.  The point of the book is to demonstrate how insightful leaders, using data that may be readily available but ignored by most, can gain a competitive edge. But one doesn't have to know anything about or even like baseball to gain valuable lessons.  During my tenure as a corporate executive, I would purchase this book for all of my senior managers in order to foster a culture of predictive analytics in our business.

In a recent talk delivered at the LSSO Raindance Conference, Boston Celtics president Rich Gotham discussed the role of predictive analytics in managing a major sports franchise.  He acknowledged the heavy use of analytics on the court – the Celtics coaches regularly analyzed opponents’ tendencies and then devised game plans to exploit weaknesses. But Gotham went on to describe the critical importance predictive analytics play off the court as well.  As he explained, team management has to know who to target in order to sell the most tickets.  They need to know which combination of price and amenities will appeal to different target markets.

For example, by rigorously studying patterns in renewals and cancellations of luxury boxes, Celtics management discovered a critical miss in their sales strategy.  The target demographic for luxury box suites is high net worth individuals and corporate executives, but these buyers are also the most likely to have other commitments, including regular out-of-town travel, which limit their availability to attend multiple home games.  The Celtics addressed this problem in part by creating a secondary ticket market for luxury suite owners. If a luxury suite ticket holder can't make a game, the team will help resell that ticket. This approach removed the box holders’ concerns about a wasted investment and significantly improved the luxury box renewal rate.

How does this apply to law firm leadership?  Very simply, there are data available today that leaders ignore, instead relying on instinct and intellect to manage their enterprises.

In Moneyball, the crusty old baseball scouts who eschewed data but could recognize a “baseball body” were, statistically speaking, wrong far more than they were right.  This is not unlike recruiting in the modern law firm, where top grades from top law schools are used as a proxy for quality, when other factors are likely to play a stronger role in the recruit’s chance of success and longevity in the firm.

In countless practice group retreats when we list our client targets for the coming year, inevitably we identify multi-national companies with big legal budgets, or existing clients who have represented large billings in the past.  In fact, deeper analysis may reveal that our most lucrative clients are, for example, companies with less than $0.5 billion in revenues, doing business in a narrow range of SIC codes, with a certain geographic footprint and a management profile that suits our lawyers’ personalities.  Yet we ignore those prospects in lieu of the fruitless pursuit, along with hundreds of competitors, of the same old FTSE 100 or Fortune 500 companies.

And yes, these concepts apply even to the practice of law.  The increase of project management and process improvement has illuminated for lawyers that while every matter may be unique, each is likely comprised of tasks that we’ve tackled countless times previously.  As we learn how to break matters into component tasks, we recognize that reassembling these tasks into new combinations for purposes of budget forecasting gives us a competitive edge – not only can we confidently price a matter based on past performance, but our deeper understanding of how these tasks have interoperated in the past helps us minimize surprise as the matter progresses.  Start layering in knowledge about specific adversaries and even judges and jurisdictions, and our reasoned analysis of what’s likely to happen based on what’s happened previously will look like voodoo to an outsider.

I will discuss the role of predictive analytics in two upcoming sessions. The first is in New York on Wednesday, November 6, and the second is in Boston on Thursday, November 7.  I will lead an interactive discussion for law firm leaders, practice group leaders, law firm c-level executives and those leading business development and strategy. This will be followed by a reception hosted by Thomson Reuters, the event sponsor.  For more details and to register, click here.

Timothy B. Corcoran delivers keynote presentations and conducts workshops to help lawyers, in-house counsel and legal service providers profit in a time of great change.  To inquire about his services, contact him at +1.609.557.7311 or at tim@corcoranconsultinggroup.com.

Crowdsourcing Legal Project Management: How to get started?

I was invited to contribute to Michelle Mahoney's recent ILTA blog series on legal project management.  In this series, numerous experts, pundits and practitioners with experience in project management offer insights and suggestions on how to embed LPM into a legal practice.  Contributors include Ron Friedmann, Liam Brown, Antony Smith, Toby Brown, Sheri Palomaki, Stuart Dodds, and other smart cookies. Here's my comment:

Embedding project management in a law firm is a challenge for many, but not because the subject is difficult or the technology to support it is in its infancy. The greatest obstacle is the average partner's perception that project management applies primarily to repeatable, commodity, low-cost legal practices.  When the lawyers are asked, or even forced, to adopt a new business process that feels inconsistent with how they practice law or earn a living, there is natural resistance.  The best project management programs start, therefore, with partner education.  Once partners recognize two key economic drivers, they often accelerate their adoption of project management principles.

The first driver is that regardless of billing type – hourly or non-hourly – and regardless of price sensitivity, the path to maximum profitability is to lower the cost of delivery, and this is done by finding efficiencies.  Lawyers should have embraced project management long before the economic downturn, but doing so now can quickly improve declining financial performance.  The second driver is client satisfaction and retention.  With clients increasingly demanding matter budgets, those lawyers who can deliver predictability in legal costs with confidence will improve client satisfaction and earn multiple repeat engagements, even as the competition endures RFPs and competitive bidding processes.

Project management is perceived by some to be an approach that primarily benefits clients. While clients indeed benefit, the greatest beneficiaries are the lawyers and the law firms.  Once this is clearly demonstrated to the partners, most firms can't move quickly enough to embed project management into the firm's operations.

The reality is that project management works. Partners raised on "law as art" resist this notion because they often equate LPM as part of the movement toward "law as commodity." Nothing is further from the truth. LPM can actually elevate law, particularly the law needed in commercial business transactions and litigation, from a costly, necessary evil that business leaders avoid at all costs to a strategic initiative.  If a business leader has improved awareness of business risk, has a broad understanding of the costs and impacts of various alternatives for business growth, and can proceed with confidence while competitors proceed timidly due to uncertain costs and risk factors, this provides a compelling strategic advantage.

Skeptical law partners reading this likely have 20 or more objections to the ideas offered in this ILTA blog series. With all due respect, others have raised these objections previously. Long before you. And yet, many partners have proceeded to vigorously embrace LPM into their practice. Do you really think they're choosing to make less money, that their practices are comprised solely of repeatable commodity tasks, and that their clients are focused solely on cost instead of value? Perhaps it's time to revisit your assumptions. The answers are out there.  What are you waiting for?

Read the other contributions here.

Timothy B. Corcoran delivers keynote presentations and conducts workshops to help lawyers, in-house counsel and legal service providers profit in a time of great change.  To inquire about his services, contact him at +1.609.557.7311 or at tim@corcoranconsultinggroup.com.