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Written by Norman Clark
Published: 23 August 2017
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iStock image licensed by Walker Clark LLC, commercial reproduction prohibited

Many small and midsize law firms find themselves in some difficult -- and for most of them, unprecedented -- strategic predicaments. 

They also are confronted with a wide range of possibilities such as, mergers, Vereins, general and specialized networks, "best friends" relationships.

How can each firm make the decision that is best for them?

The internationalization of legal practice and the entry of foreign and other non-traditional competitors into local legal markets have created a lot of uncertainty for small and midsize firms:

An attractive, growing legal market inevitably attracts new competitors. Local law firms, which for purposes of this discussion include law firms that are located in only one jurisdiction, inevitably find themselves having to navigate new currents in a maturing legal market with new competitors, many of which are larger, better-resourced outsiders. The firm in New York or London that used to refer work to the firm now has an office across the street and is competing head-to-head for the many of the same clients.

Local law firms have responded to the maturation of the international legal market through a variety of structures to improve their international visibility and, more importantly, their service delivery capabilities: de jure and de facto mergers with other law firms; global networks; joint ventures; strategic alliances; and “best friends” relationships. Each structure, in its many variants, offers substantial opportunities to serve clients better, improve financial performance, and maintain competitiveness in a tightening, much more competitive, legal market.

The relative advantages and disadvantages of these options are well-known among most lawyers in most legal markets. This paper suggests several intellectual processes that are less well-known, but have proven to be critically important for a local law firm that wants to retain its client base and market position when its legal market matures and becomes intensely more competitive.

Click here to read and download our full background briefing on Merger, Best Friends, or Something Else?

 

Norman Clark