A number of our law firm clients have asked whether they should try to join a law firm network.

Our answer usually is "it depends."

One can argue that the traditional law firm network has been made obsolete by the expanding expectations of clients for a suite of professional services, in which legal advice is only one component (although a very important one). The entry of global law firms, with their abilities to deliver legal services almost anywhere in the world, is another factor.

Firms considering affiliation with one of the large, general law firm networks should measure carefully the probable return on their investment of dues (which can be considerable) and, even more importantly, partner time (which can be even greater, but which many law firms minimize). The costs are substantial, and many small and mid-size law firms -- as well as some large ones -- perceive diminishing returns over the next five to ten years. One law firm partner even recently told me that she expected that traditional law firm networks eventually would become "nothing more than social clubs."

This might be over-stating the case, but it illustrates the strategic choices that most law firms face. We cannot rule out membership in a global law firm network as an option in every case; but we believe that for most law firms -- and especially mid-sized ones -- there are options that could produce a better return on investment. Three types are most attractive, but frequently overlooked.

  • multidisciplinary professional services networks: There are others, but the World Services Group is probably the best-known and most successful example. WSG consists primarily of independent law firms, but also includes accounting firms and investment bankers in its membership. (In the interests of full disclosure, Walker Clark LLC has been a member of the World Services Group for more than a decade.) WSG now has more than 130 members operating in more than 115 countries. Two of the advantages of a multidisciplinary network are: (1) the ability to assemble full-service professional services teams to provide better-managed, cost-effective support to large transactions; and (2) more robust referral potential outside the member firm's own professional discipline. International Referral is another, smaller, example.
  • integrated regional networks: These associations of independent law firms are structured like a traditional network but function almost like a regional law firm with respect to certain cross-border or multi-jurisdictional matters.Some have become a favorite "local partner" of a global law firm, providing highly responsive, cost-effective services without the tremendous investment required for an on-site presence by the foreign firm. The South East Europe Legal Group is a good example, consisting of 10 firms, each of which is a top tier law firm in their respective 12 jurisdictions in the region. (Some of these firms also belong to other networks.)
  • international specialty networks: Well-known examples of these networks include IsFin (Islamic finance and markets), Ius Laboris (labor law), and Construlegal (construction law). They can be very beneficial in promoting the international visibility and reputation of a firm's key practice groups. Some of our clients have reported that active participation (and we stress the word "active") has produced substantial increases in requests for proposals and new engagements that they do not believe that they otherwise would have received.

In view of these alternatives, are traditional law firm networks obsolete? We cannot say definitively that they are, but the business case for joining one is not very strong for most law firms today. While not ruling out the traditional network, law firms should consider the three alternatives carefully. Membership in any of these types of organizations requires a substantial commitment of time and resources if it is to be successful; and the choice must be well-informed, realistic, and supported by the entire partnership.

Norman Clark