7. Dealing With the New Reality
As the business world is becoming increasingly organized and connected, and general counsel and other buyers feel the squeeze, the buy-side now tells the sell-side how to operate. Given that raw demand is falling, law firms are paying attention.
April 27, 2021 at 08:45 AM
3 minute read
The original version of this story was published on Lean Adviser
"A law firm should never take the client relationship for granted, because ten highly qualified firms are just waiting to take its place in line. Law firms that understand what makes us tick, take an interest in our objectives and find ways to promote them are the firms we are likely to engage for the long-term." — José Gonzalez, EVP& General Counsel, CNA, USA
It might be argued that law firms have no application tools because there is no requirement from clients for operational efficiency. If that was ever true, it isn't now.
For a century or more, law firms defined the legal services that they would offer and they set expectation parameters for clients. Now it is the opposite. The first clear inklings of this started a few years ago. Way back in March 2015, . Mark Chandler, General Counsel of Cisco, said that the goal of the smart attorney in private practice is to change the firm for the clients.
This was a perfect prediction and synopsis of where we are today, following a steadfast trajectory. As the business world is becoming increasingly organized and connected, and general counsel and other buyers feel the squeeze, the buy-side now tells the sell-side how to operate. Given that raw demand has been consistently falling and alternative legal service providers have been gaining traction, law firms are paying attention.
Law firms are subject to modernization and efficiency pressures in every sphere of practice. There is no sign that this is a blip or a fad. This is the new reality. Regulators, courts, but most of all clients, now care how law firms operate and they want them to be smarter.
The New Reality encompasses these key aspects:
- GCs face increased responsibilities, decreased budgets, and their role is changing. So is their approach.
- Clients would rather have light advice quickly, coupled with reasoned recommendations, than legal essays.
- Most of all, clients want problems solved and they are becoming 'supplier agnostic' about how they get this.
- The inflection point has arrived and the frame is broken. It's all up for grabs.
- Law firms are naturally resistant to change, but the agile, adaptable ones will use client voice to drive change.
The New Reality affects all legal service providers, regardless of size, skill, or reputation. Large clients with bigger legal budgets have the same pressures as small ones, and AmLaw 100 firms have the same challenges as boutiques. With the new reality comes the profound disruption that we have all seen. And with profound disruption, guess what also arises? Opportunity.
RELATED VIDEO: The New Reality
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