Re-imagining a law firm
“the ultimate, hidden truth of the world is that it is something that we make, and could just as easily make differently” David Graeber
Let’s face it, for many SME law firms ‘re-imagining” thinking and doing has been difficult over the last 10 or 20 years. Change has often come in the form of market driven ‘push’ effects rather than ‘pull’ innovation within existing firms. Technology developed by legal technology companies has been adopted to varying degrees of success to help deal with an increased risk and compliance burden, more demanding client expectations, and downward pressure on profitability.
Many high street law firms have found themselves driven to adapt their business models and lower the cost of delivering legal services, not by being in the driving seat, but rather a combination of market forces and legislation seemingly out of their control in many areas of law. Seen particularly for the individual consumer legal matter: Residential property, Wills & LPA, Probate, legal aid funding and so on. Third parties have stepped up into a marketing and innovation gap. Inserted themselves into the law firm/client relationship thereby controlling pricing, data, and client acquisition – ultimately eroding the lawyers’ direct connection to the customer and the marketplace. The law firm becomes the delivery partner in the supply chain but still carries all the legal risk and the majority of the cost of delivery. Example third parties are/were accident claims companies, estate agents and property panel firms, or corporate wills and probate providers dealing in unregulated legal work. This dynamic can work well for some law firms of course, but usually needs scale, specialism, and a focussed process and IT-led business to deliver commercially. This level of specialism in itself entails a level of market/economic shock risk that the full-service regional or reasonable sized high street law firm is better placed to adapt to.
Perhaps after this introduction, you could be forgiven for thinking that it is difficult for the SME firm to be a master of its own destiny. Not at all. This article is a rallying call for the SME law firm. To highlight the adaptability and capability for delivering change that was clearly always present and forced into the limelight by the pandemic conditions.
There is no better time for structural and cultural change
One outcome from living through challenging times in business is to seize the appetite and attitude to deliver positive change. There is no better time to make some of the cultural, process, or structural changes that may have seemed impossible or difficult in the past. Everyone has gained new perspectives over this time which could prove to be a positive or negative force for your firm.
It is quite possible that these new perspectives were slowly gaining momentum as new generations join the workforce. Anecdotal evidence from all sectors suggests however that the forced transformation we went through is going to have a significant impact on our working experience moving forwards.
For this article a number of different interviews were conducted to better understand some of these emerging perspectives.
Perspectives from a lawyer, managing partner, and a pioneer of change in legal
Verity Saxon is a 10 PQE employment lawyer who changed roles in 2020 and is now a Director at mpm legal solutions limited. Nicola Poole is Managing Director of Hedges Law, a law firm with a fascinating evolution over 273 years of history in the Oxford area. Janet Cooper OBE is a long-standing pioneer of change since the 1990’s in the legal sector as a Linklaters Partner for 20 years, then founder of a multi-award-winning law firm.
Many law firms have reported a ‘better than expected’ outcome to the disruption we have all been through. Suddenly a new ability to manage without one’s PA on hand or reams of printing and paper files has been realised. We’ve all had to go through an uncomfortable learning curve whilst still trying to do our jobs. Learning unfamiliar software or conference meeting skills. Much of the recent period has been spent in a way of working once unthinkable for many lawyers.
This transformation experience is not confined to the legal sector by any means. A survey of 12,000 employees across many sectors in 2020 by Boston Consulting Group found that:
“Things that might once have seemed impossible have proved surprisingly workable. With collaborative productivity essential to innovation, the changes will enable companies to become more competitive. And given employee desires for flexibility, the changes will also allow companies to recruit and retain the best talent.”
In many ways the pandemic has accelerated change that was already bubbling away under the surface. For a number of different reasons working for the same law firm for decades to make equity partner is perhaps not the holy grail of a legal career it once was. A perfect storm of demographic and economic factors combined with changing work/life balance aspirations is driving a level of demand for change. Perhaps as we all face looming existential threats such as pandemics and climate change focus, or at least some level of awareness, is shifting from an individual path to our impact and legacy at the family, societal, and even planetary level.
Hazlewoods wrote for Calico in 2018 about the rise of the ‘platform law firm’ that includes IT led firms and different employment structures. Recent interest in Employee Ownership Trusts and fee-sharing self-employment arrangements indicate a shift in thinking too and an appetite for control of one’s destiny. Old assumptions about law firm valuation and exit strategies (PI run-off cover!) are contributing to a re-think from the top down. In formal motivation theory terms this is all about Autonomy. From management style to the very direct link from our own performance and rewards.
Speaking to my three interviewees is a small snapshot of a broad range of views of course. But the responses were fascinatingly correlated with results from the final stage of my 2016 MBA research study on motivational factors and technology in the legal sector.
Reading the room
Let’s talk about reasons for changing employer and remote working which made a surprise entrance for everyone but looks set to remain in some form.
Verity Saxon, a 10-year PQE employment lawyer, accepted a new role in January 2020 with mpm legal solutions Limited, eventually joining in September 2020. Verity was looking to join a ‘forward thinking’ firm. We talked more about what this actually meant for her. Verity used the words “finally empowering herself” in the search for a new role. She very much felt that she had accepted the pressures of “being last in and first out of the office” of holding a part time role and a typical employer/employee in a traditional office environment for many years, too long in fact. This journey to empowering herself was a difficult one with lost inner-confidence along the way. It’s a feeling that many women have experienced taking maternity leave from a professional role, then coming back to a flexible or part-time role. We talked about how much of the pressure is self-inflicted, to again be that person with a 100% focus on job and career before but who now is juggling multiple equally demanding roles. A culture of office presenteeism just reinforces the notion that is it all or nothing in terms of ‘performance’ as a lawyer and that simply isn’t true.
Verity found her ideal match in a small specialist firm with people who “like what we do”, “have no office politics” and like “working with people”. The “breath of fresh air” as she describes the move is a completely output led management style. Management does not concern itself with how and when she delivers her legal work. An open-door policy, inclusive decision making, and monitoring of only overall output and client satisfaction supports the culture of personal responsibility, and yes that powerful long-term motivator: Autonomy.
Verity admits that at first it was hard to shake off some of the clock watching habits to adjust to her new-found freedom and autonomy. She was very clear that a hybrid model of some time at home, some in the office, was a preferable way of working. To go into the office to “touch base, catch up, and have that human connection”.
Many lawyers have reported a more productive day with a better work/life balance without the commuting time. Is this more appropriately labelled work/health balance? Perhaps this is a better description of making time for our own physical and mental wellbeing whilst handling work and family related responsibilities that is, after all, normal life.
Focus is good for your brain!
For those well-read in employee engagement psychology (ok, it’s a quite niche I’ll admit!) it is no surprise that for detail orientated and written work a hybrid model working pattern will benefit the individual and organisation.
A positive psychological state called ‘flow’ created by a concentrated focus on a task was first described in the 1990’s by Csikszentmihalyi. It was later linked to positive employee engagement and intrinsic (long-term) motivation theories in the mid 2010’s by other researchers in this area. We’ve all experienced it even though we would have never have labelled it a “flow state” of course.
A “flow state” is achieved with an absorbed focus on something where our awareness of surroundings or time is reduced, formally called time distortion or telepresence. It is actually a very positive state of mind to experience which is where the relevance for legal work comes in. A flow state is hard to achieve in an open-plan office with constant interruptions from colleagues and phone calls or email notifications and the like.
To read more on this here is a link to a good summary of the mental health, engagement and productivity benefits to the individual of flow state.
A hybrid working model is coming along the line for many sectors, including legal, and it offers many different benefits. Not least the above-mentioned motivation and mental health benefits which will no doubt be framed in less technical terms such as reduced stress levels;
“Our findings suggest that the future of work will be increasingly hybrid. And this presents both challenges and opportunities: to reimagine the entire employee experience and to create conditions that allow employees to thrive in the workplace of the future—one that will be far less office centric. This means developing new hybrid working models that enable employees to move seamlessly between onsite and remote work, as well as thinking about the appropriate physical space—both size and shape—for the hybrid office.” BCG 2020
But can a traditional firm be ‘re-imagined’?
Nicola Poole the Managing Director of Hedges Law is better placed than most to comment. Having joined the Hedges 17 years ago Nicola has transformed the practice through a complete ownership and structural change, developing and then closing a central Oxford office, to a completely remote based law firm all working in the Cloud. From wood panelled office with formal titles for the Partners Nicola has steered Hedges Law on an epic journey into the 21st Century.
We talked about recruiting talent and maintaining company culture in a remote based team. The challenges of succession planning and onto employee ownership share schemes. At first glance it was a completely different conversation to Verity, but on reflection intrinsically linked with many of the same themes and learnings that point the way for SME firms.
With a passion for agile working to assist talented lawyers with families to stay in the profession, Nicola was keen to develop a firm that could support women with children (and dad’s too!). “I really wanted to create an agile workforce, in particular for working Mum’s as there are so many women forced out of the workforce because they couldn’t make it work, but have really great brains”. In addition, the target client was not readily available for meetings in the traditional core 9-5pm working hours either so it makes sense all round.
A great insight from Nicola putting all this together was:
“Monday – Friday 9-5pm – who does that work for?… all other areas of service industries have adapted, but legal services on the whole has not. In other sectors the services now come to the client”.
Following a staff survey of the Hedges Law teams the results show that 80% of staff would like to continue working at home in some capacity and 80% felt they were more productive. This is very similar to feedback gathered elsewhere such as this report from Acritas, part of Thomson Reuters interviewing 800+ lawyers:
“77% of the senior lawyers we interviewed, want to retain elements of this new virtual, remote working – to varying degrees. And critically, 22% said they are likely to leave if their firm didn’t accommodate the new way they want to work.”
Acritas Global Stand-Out Talent Survey,
The challenge as Nicola sees it is to maintain meaningful contact and a strong firm culture remotely, via video and phone calls, avoiding emails where possible. It does not replace face to face contact of course which is a key consideration moving forwards in work and workplace design.
Quality versus quantity
A running theme through all three conversations was the opportunity to make the time with colleagues and clients a quality experience. To build relationships and share knowledge. Now firms may well have more budget to spend on smaller but higher specification offices or meeting spaces and even event catering than was possible before.
“Respondents told us they miss “being able to spontaneously walk to a co-worker’s desk and discuss an issue” and “social gatherings at work.” It will be critical for companies to recreate this connectivity regardless of where employees are located.” BCG, 2020
Membership of a high-quality venue for local meeting spaces was part of Nicola’s drive to give her team more autonomy in terms of “access for family and owning your own brand with the freedom within a law firm, but you are not a robot”. All part of Nicola’s focus “of creating an empowered workforce, which goes hand in hand with the employee owned workforce” in terms of the recent Hedges Law employee ownership trust (EOT) project.
Who can we learn from?
Janet Cooper OBE has been a pioneer of doing things differently in legal since the 1990’s. As a Linklaters Partner of 20 years and then founder of a multi-award-winning law firm Janet has never been afraid to challenge the status-quo and a ‘how it always been done’ culture. All the challenges that law firms have experienced recently and will be experiencing moving forwards Janet has been there. Janet’s team within Linkaters was working in agile or flexible working patterns when it was unheard of in any law firm, and long before any technology was remotely useful in supporting this model.
Motivated by the talent lost to an inflexible 9-5+ regime (and likely many more hours) culture in a large firm, Janet set about building a team made up of the best legal brains who could not normally expect flexibility in large law. Over time her practice became one of the most profitable teams and lessons learnt she then applied to her own law firm. The main message Janet has for us is;
“There is so much legal talent locked out of the profession and progression to partnership by inflexible working patterns, sadly often these lawyers are female. “
Janet Cooper OBE,2021
A practical, but also strategic shift is required
Janet advises that working with a remote or flexible team requires a cultural level shift in thinking too to make it work. Summarised as shifting the emphasis from the individual to the team. This sounds simple but is a profound shift for many firms used to the 1:1 client/lawyer ratio.
The team orientated service model naturally impacts on many areas from performance management to information sharing. But that these changes also protect the law firm from ‘leaver shocks’ where not only the lawyer leaves but their portfolio of contacts and clients does too. There is much more to say on this particular topic so that’s for another article.
It is possible, it has been done, and many firms have adapted brilliantly. Many of the changes brought forward by recent times are the same required for effective adaptation into the 2020’s and beyond. Changes will be driven by Millenials and Generation Z respectively moving to management positions and joining the workforce. The change in structure and management styles to recruit and retain legal staff working more flexibly are very similar to those changes that are attractive to the future workforce too.
Just one of nine findings relevant to this discussion from an enlightening report on Generation Z in the workplace from Deloitte that can be accessed here is;
“Gen Z no longer forms opinions of a company solely based on the quality of their products/services but now on their ethics, practices and social impact.”
Deloitte, 2018, Welcome to Generation Z
I have written before for Calico about the infamous “water cooler” conversations and the importance for employee engagement in understanding and applying long-term motivational drivers in all aspects of people management. These are things outside of basic hygiene factors for just coming to work such as pay and other monetary rewards. The real performance rocket fuel is in providing strong Purpose, Mastery and Autonomy elements to the work and organisational design.
Without Trust there can be no Autonomy
Autonomy of course is a big function of building Trust between employer and employee. Without trust there can be no autonomy. This is probably the biggest cultural shift in thinking for many law firms who had, and still have, a culture of presenteeism rather than robust performance management approaches based on quality and output. Circling back to Verity’s experience of the part-time working pressures within a traditional law firm we see that this is logically so. Firms who can support their partnership and people managers to embrace this at the heart of their culture will survive and thrive in the long term.
Deloitte’s over-arching advice to business is to:
“To succeed, organizations should consider “zooming out” and imagining the possibilities so they can compose the work, the workforce and the workplace in a way that increases value and meaning.”
This all sounds great but how to go about it?
Driving change and the evolution of a business over the long term can be draining. We all need ideas and an influx of new energy. There are many great advisors out there, and peers, who can support, share ideas and lessons learned.
Join our monthly strategic webinars at Calico to hear from expert advisors and reach out to others in a similar role.
Specialists such as Calico Associates Rebecca Bonnington from Tricres and Joanna Gaudoin from Inside Out Image can help your firm develop management strategies from the top level ‘raison d’êtra’ to the soft skills your people managers need to support and develop the next generation.
If you want someone who can help with many different areas of law firm strategy from this topic to technology and join it all up then give me a call. I work with a select few law firms who want to make progress in all areas from structure to marketing and technology with a holistic, joined up, approach to it.
Author: Pauline Freegard, INK Legal