Taylor English Duma last year hired as its chief executive officer Kirk Hancock, who had served as the chief operating officer and chief financial officer of global management consulting firm The North Highland Co. Hancock is not an attorney; he has more than 30 years of experience as a finance, accounting and operations executive.

The full-service firm has 170 lawyers in Atlanta; Chicago; Houston; Jacksonville, Florida; Los Angeles; Nashville, Tennessee; Raleigh, North Carolina; San Francisco and Washington, D.C. It has a transparent compensation structure and offers alternative fee arrangements.

Hancock provided the following answers to the Daily Report's questions.

What do you view as the two biggest opportunities for your firm, and what are the two biggest threats?

Big Am Law firms will continue to get squeezed as clients demand more value and accountability and look outside the guildlike network of those firms. At the same time, Fortune 1000-type clients are finding that they can run their own in-house departments as captive law firms that can handle many matters. There will continue to be what I call “existential matters” that require the expertise of big firms, but that constitutes a relatively small portion of all legal services. The Am Law 200 will become the Global 30. The big firms benefited enormously from the system they built and are now trapped by it. The forces bringing about the disaggregation of the giant firms are creating opportunity for middle-market firms that can offer big-firm expertise with nimble, business-minded, experienced, trustworthy and efficient attorneys for about 95 percent of the matters that currently keep the big firms alive.

The legal market is so competitive now—what trends do you see, and has anything, including alternative service providers, altered your approach? Is your chief competition other mid-market firms, or is your firm competing against big firms for the same work?

Our biggest competition is the old way of thinking. A lot of the assumptions that have been built during the past 50 years are gradually falling by the wayside. The legal business is in the midst of a life-changing disruption that will change how firms think about compensation, how large corporate law departments select law firms and, maybe most importantly, whether lawyers can embrace the same level of risk that their clients know every day.

Law firms have lived in this wonderful alternate reality where everything is cost-plus. Law firms talk about “partnering” with their clients, but what does that mean when you don't have skin in the game? Gradually, over the next 10 years, multinational corporations will insist that law firms share risk on many of their matters. In practical terms, I expect to see project billing for all but the most complex and specialized work.

There is much debate around how law firms can foster the next generation of legal talent. What advantages and disadvantages do midsize firms have in attracting and retaining young lawyers, particularly millennials?

This is another area where Taylor English is turning the Big Law model on its head. We don't hire attorneys with less than three years of experience. That is, we don't hire attorneys who can't bring value to client relationships. I don't blame new law school graduates for wanting to land a $160,000-a-year job at a big firm, but those hiring classes are getting smaller and smaller as clients opt out of the assumption that they should pay to train expensive young lawyers. Frankly, I worry about how young lawyers will get the training they need in this less-forgiving environment.

As far as senior attorneys, the deleveraging of the large firms has created a talent opportunity for middle-market firms like ours. The big firms are shedding excellent lawyers for budgetary reasons and because these attorneys are looking for better balance, and some of them are finding homes in middle-market firms. Clients are beginning to notice that some of the same lawyers they paid $800 an hour last year are now doing the same work at a middle-market firm for $400 an hour.

Both young and older attorneys at middle-market firms are going to have to be comfortable with a more transparent production-based model. Those who are comfortable with this kind of reward system will do quite well. But it may not be for everyone.

Does your firm employ any nonlawyer professionals in high-level positions (e.g., COO, business development officer, chief strategy officer, etc.)? If so, why is it advantageous to have a nonlawyer in that role? If not, have you considered hiring any?

I am one of those nonlawyer professionals. My background is in growing and managing large professional services organizations. The business side of the models are very similar, and the legal profession has been slow to adapt to the changes already adopted in other professional service industries. We have great lawyers here, and they were visionary in how they went about forming this firm. Marc Taylor and the other founders saw the opportunity that the changing legal market created. But at the end of the day, their training is not in the nuts and bolts of business processes. Traditionally, professional services firms had the luxury of pretending they were genteel partnerships, and they did not have to be aggressive in refining their metrics and building fiscal models that pinpoint all the leverage points. Some folks may not agree with my assessment of the prospects of Big Law, but just about everybody has recognized that law firms in today's marketplace won't survive without the sophisticated financial management that other businesses of their size and complexity have relied on for a long time.

What would you say is the most innovative thing your firm has done recently, whether it be technology advancements, internal operations, how you work with clients, etc.?

One of our innovations has been to expand to other cities without adding expensive brick and mortar. We are aggressively taking advantage of the change in work styles and technology by growing our remote practice. Some call this a virtual firm, but we have modified that model by leveraging the more traditional hub of 160 attorneys and support here in Atlanta with the attorneys in other markets. We had to find ways to serve our clients who had matters or a presence outside Atlanta, and we are doing that by creating boutique outposts. These are senior attorneys, most of them with experience at Am Law firms, who wanted to work independently but who still want the support, resources and networking of a full-service firm. We have become a hybrid firm that is a combination of brick and mortar and virtual attorneys.

Does your firm have a succession plan in place? If so, what challenges do you face in trying to execute that plan? If you don't currently have a plan, is it an issue your firm is thinking about?

This is an area where almost all professional services firms, especially law firms, struggle. Middle-market firms tend to have personality-focused leadership, and it is difficult to think of who the next person up will be. Taylor English spent its first decade getting established. We are now focusing on how to refine the model to become a multigenerational firm that extends beyond the founders. That is in large part why I was brought in to lead the firm in that journey. While we don't have a complete succession plan in place yet, we have done two things that set the table for the plan. We've created a democratic governance system where all of the partners are involved in decision-making, and we have a support system of professional staff—like me—who provide the financial and institutional stability that comes from having a defined firm strategy and robust business processes in place.