VQ Newsletter August 2010

Topics in this issue of VQ Newsletter: Trends in the legal market – alternative fee arrangements and changing law firm business model; VQ holds KM course on 22 September 2010 arranged by InfoTorg; VQ Knowledge and Strategy Forum on 11 and 12 November 2010.

Trends in the legal services market

We follow the international legal market trends and the development in knowledge management and business strategies closely. Lately, there has been a lot of discussion on the trend with clients questioning the billable hour and demanding fixed prices and other alternative fee arrangements. In a survey reported in the current issue of Managing Partner Magazine it was clear that the largest buyers of legal services are very cost driven and focused on fees when asked about upcoming changes to the legal market, predicting changes to fee structures, greater flexibility on fees and increased usage of fixed fee arrangements.

Several other international magazines, such as The Economist, The Lawyer and AM Law Daily, have reported on the trend with changing fee structures. Similarly, the topic has been examined in Swedish media such as Advokaten, Affärsvärlden and Dagens Industri, with the conclusion that the large commercial law firms are under pressure and that alternative fee arrangements are gaining ground also in Scandinavia.

And just last week it was reported that CMS Cameron McKenna has taken a new groundbreaking approach to the issue by inviting clients to pay what they want for legal work. Their recently launched marketing campaign promotes its alternative billing structures, which include a ‘pay what you think its worth’ option, to clients.

A reason behind the changing fee structures is the general swung of balance towards stronger and more demanding clients and competition from new legal players such as virtual law firms and outsourcing service providers. This shift has made it increasingly important for law firms to focus on standardization of processes and the use of technology to find new, more cost-effective ways to deliver the same quality legal services, while maintaining profitability.

It has also given rise to another interesting discussion internationally on the business impacts of changed fee structures and the business model of law firms. The traditional business model has a pyramid-style structure with a large base of junior associates with a few partners on top. But when efficiency is the key, rather than number of hours spent, many of the tasks carried out by junior associates may be replaced by standardisation, increased professionalization by specialists, outsourcing and better use of IT and appropriate knowledge management tools to support the business. This will affect the traditional pyramid structure and change it towards a more rhombus-like shape with a larger number of associates with some years experience and a lessened basis of junior associates.

This kind of trends and topics will be addressed at our upcoming Knowledge and Strategy Forum in November, please see further information below.

Free KM course on 22 September

In June we launched “VQ Training Courses” with courses, coaching and seminars supporting knowledge leverage and business development. We offer inspirational presentations, strategic information for the management and other visionary and innovative seminars.

VQ is also facilitating a KM course as part of the legal training programme of IntoTorg on 22 September 2010 together with Carl Brodén, Mannheimer Swartling, and Christer Häggström, Ernst & Young. This course is complimentary and open to all lawyers, in-house counsels and other legal and accounting professionals.

VQ Knowledge and Strategy Forum on 11 and 12 November

This autumn, VQ is proud to arrange the first annual VQ Knowledge and Strategy Forum for the legal sector to take place at the Grand Hôtel in Stockholm on 11 and 12 November. This forum will address trends on the legal and professional services market and will cover a wide range of topics of interest for leadership, strategy, innovation and technology.

The forum has a mixture of international speakers and Swedish speakers with an English-speaking day with an international focus on the 11th and a Swedish-speaking day with a more Scandinavian and practical focus on the 12th.

We are delighted to present Nick Jarrett-Kerr as a key contributor. Nick Jarrett-Kerr is one of the most influential international advisers to law firms on business issues, strategy, leadership and management. Nick Jarrett-Kerr also leads the strategy modules on Nottingham Law School’s MBA program and is the author of the book “Strategy for Law Firms – After the Legal Services Act”.

Some of the other internationally well-reputable speakers we are very proud to present are Lisa Göransson, Head of the Nordic Desk at Allen & Overy, David Fitch, Director of Knowledge Management at Simmons & Simmons, Juliet Humphries, Head of Knowledge & Learning at Bird & Bird, Katja Ullrich, Head of Knowledge Management and Training at BAE Systems and Reidar Gjersvik, Knowledge Manager at Thommessen, with Annette Magnusson, Secretary General of the Arbitration Institute of the Swedish Chamber of Commerce as chair of conference.

Please see the VQ forum event page for more information and registration. Please note that there are still early bird and other special discounts to take advantage of.

After the end of the conference program of VQ Knowledge and Strategy Forum on 11 November there will also be a complimentary cocktail reception, which will provide a great opportunity for networking.