The law firm of the future will have only three things: a lawyer, a computer, and a dog.
The computer will deliver legal services.
The dog will keep the lawyer away from the computer.
And the lawyer will feed the dog.
Even with artificial intelligence, the legal profession is not likely to be taken over by dogs and computers very soon; but there are clear signs that the old paradigms that have governed law firm staffing and service delivery for decades are crumbling. Indeed, the traditional partner-associate-paralegal-staff structure, with everyone working at the law firm's office, may be largely obsolete in most legal markets within the next ten years.
An article in today's issue of The Lawyer reports that the British firm Shoosmiths is the latest to join this trend, with the launch of their out-placed legal service cluster known as Resource Solutions. Shoosmiths follows firms that have already entered a new market for contract lawyers to be seconded, sometimes on a more-or-less permanent basis, to work in clients' offices. The other firms include: Eversheds (Eversheds Agile, 2011); BLP (Lawyers on Demand, 2012, which is now a separate business entity); and Allen & Overy (Peerpoint, 2013).
The shift away from permanently employed lawyers resident at a law firm's office, to contract lawyers located on-site with the client, has been driven in large part by more demanding client expectations for flexibility in the way that they purchase and receive legal services from law firms. "Forward deployment" of professional staff in a client's legal office not only significantly reduces fully-loaded operating costs for a law firm, but also can give the firm a broad and intimate understanding of major client business sectors. Equally importantly, it forces law firms that manage these remote service providers to get very serious about quality assurance, which further enhances client satisfaction and profitability.
Only a horror of cliches prevents me from being tempted to call it a "win-win" proposition.
However, this is not a strategy only for large law firms, which might have excess work capacity in the form of large numbers of under-utilized associates in their offices. Small and midsize firms can use contract lawyers working on-site as a way to expand their penetration into key client sectors, improve client satisfaction and loyality, boost revenue, and improve profitability. In other words, here is how a small firm can "grow the firm" while remaining more or less the same size.
Can we expect law firms to "shrink" in the future, as a larger share of legal services are delivered in ways other than by permanent professional staff working in a law firm office? Is the law firm of the future going to be essentially a network of contract workers, managed centrally but dispersed among the clients' site. The success so far of ventures like those innovated by Allen & Overy, BLP, Eversheds, and now Shoosmiths, suggests that client demands and the challenges of sustainable profitability will cause this fundamental change in the internal structures and workflows of law firms.
As part of our firm's strategic advice to our law firm clients, we recommend that they consider these opportunities, investigate the right balance of permanent and contract professional staff and where they work, and use new service delivery modes such as these to create competitive advantages that even the smallest firms can enjoy.