Fallacies biggest challenges for law firms

In two recent articles Nick Jarrett-Kerr confronts the fallacies and half-truths which can delude law firms and constitute one of the biggest challenges facing law firms today. Or, as Nick Jarrett-Kerr puts it, the biggest areas of danger for law firms are "not necessarily the most obvious areas of competitive challenge faced because of the Legal Services Act, but those which carry the greatest potential for law firms and lawyers to continue to place their head in the sand. After all, it has often been said that there are three basic types of lawyers - those who make things happen, those who watch things happen and those who say "what happened"?

In the article "Facing the Facts" Nick Jarrett-Kerr highlighted seven delusions and dangerous half-truths, which he then complemented with three more in "Facing even more Facts", making up a complete top ten list of fallacies. This list goes as follows:

1. "We only do High Level work"

2. "When the recession is over, all our work will come back"

3. "All our clients remain loyal"

4. "We are efficient at using Technology"

5. "We are well-managed and Disciplined"

6. "Commercial law is our route to success"

7. "We are well-known and highly regarded"

8. "The normal rules of economics don't apply to us"

9. "Clients always want a personal and partner-ledservice"

10. "The best business development is to do good work for satisfied clients"

It is deeply recommended to read the entire articles to get Nick Jarrett-Kerr's indepth analysis and explanations to each fallacy in the list. Since the efficient use of technology is one of our keystones we will focus on fallacy number four in Nick's list. As he analysis this fallacy, "there may be some firms who have managed to achieve optimal use of technology, but many firms are way behind the curve. High secretarial ratios in the legal profession still reflect a somewhat inefficient use of technology - there are still many partners who have one-to-one secretaries. The brutal truth is that anybody starting a law firm from scratch would staff the firm as leanly as possible, relying instead on heavy investments in systems, technology and sufficient knowledge management to enable menial and administrative tasks to be carried out by lower paid (and less qualified)staff rather than expensive lawyers. Working practices are hard to alter in existing law firms. Incremental improvements have proved top be slow and can easily stall at an intermediate plateau of efficiency."

This analysis is in line with the conclusions made by the newly launched firm radiantLaw that we wrote about in the post "New firm performs without timesheets to ensure real client", where the founders of the firm realised that "our ability to implement real change was being blocked by structural barriers endemic in the traditional law firm model" and that a key component for real change is technology.

The competitive edge of technology has also been discussed by Adam Hartung here on Legal Innovation Blog Using technology when competing: "All businesses compete every day. Those that learn to use new technologies are able to get more done, faster and more effectively. Those who fall into a routine of doing things the same way, and don't advance their tool set, run the risk of being knocked out of the competition."

So, what should be done? Nick Jarret-Kerr suggests that the way forward for firms is to take three essential steps - " working through what their foundation is for their competitive strategy, deciding their overall strategic direction and finally deciding the methods by which the firm might pursue its strategy", or for managing partners who already are aware of the dangerous half-truths and fallacies to "seek to persuade their partners and staff to face the facts and move out of their comfort zones".

As we have said before, we truly believe that now is the time for the legal practice to fully embrace technology and the possibility that it provides to find new innovative ways of delivering legal services and to gain competitive advantages. With the three essential steps suggested by Nick Jarrett-Kerr, it might be a little bit easier for law firms to take the practial action to do so.

 

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