How Law Firms Can Better Advance Their Clients' Goals

Major law firms in the United States should be commended. Despite their clients' hard-fought efforts, these firms appear to be immune from and unscathed by the fundamental rules of supply and demand. Indeed, as the number of major law firms has surged in cities across the United States, and the demand for outside legal services has decreased, billable hourly rates have continued to rise. While this distortion of the basic rules of economics seems to be permanent, like all bubbles it will eventually correct. When it does, law firms, especially Big Law firms, will be under intense pressure to reduce rates. To avoid this result, law firms that want to remain top-tier (and continue to bill at or above their current rates) will need to differentiate themselves from their competitors, and the best way for them to do so is by clearly and convincingly demonstrating to their clients that they understand their goals and, most important, are fully prepared to help advance these goals.

Know Your Client

While it seems simple, law firms sometimes fail to learn their clients' industries, competitive needs, and the legal and regulatory issues they are facing on a daily basis. This inexcusable ignorance, if unabated, will eventually cost law firms business. To avoid this result, certain required information needs to be continuously reviewed and discussed.

First, if a client is a publicly traded company, its outside counsel, regardless of their practice area, should be reading all of the client's public filings. These filings, whether an annual report, proxy or a periodic 8K, provide a treasure trove of information regarding a client's legal and regulatory issues. From disclosures on pending environmental liabilities to concerns around capital structure to divestment strategy, public filings provide an incredibly helpful overview of a client's legal needs in the coming months and years.