What will the law firm of the future look like?

I’m not talking twenty years hence. Looking that far ahead is always tricky…I’m of the generation that grew up in the 70s and 80s watching things like Space 1999 which was based on a premise that by the time I was 30 there would have been a base on the moon and aliens working alongside us.

How about a law firm in three years’ time?

I’m going to pose a load of questions, some of which I’d say I have good answers for, but all of which should be asked by lawyers of their own businesses as to what they believe a law firm of the future will look like.

Your market

There will no doubt have been market changes, some perhaps driven by Brexit or political changes generally. Is your market recession proof? Do you have a diversity of offerings providing you with counter-cyclical earning potential? What are you doing to stay abreast of market changes? Do you know what your competitors are doing? The firm’s overall strategy for the next few years should have clear responsibilities allocated for market info and response. Understanding how a law firm of the future will compete will be critical to protecting your own growth aspirations.

Regulation

As I’ve said many times before, over the last 30 years one of the only constants for lawyers has been changing regulation. A shifting of the goalposts. We already know that the accounts rules are changing (see last week’s article from Hazlewoods on the new SRA accounts rules). We know that Third Party Managed Accounts will enable firms to offload some of the risk of handling client money. Are your cashiers up to date with the new rules? Will the rule changes impact your present way of working? Too many times we come across firms who have not stayed up to date and are either fully in breach of regulation, or are working in unnecessarily inefficient and costly ways. Who in your firm is keeping up with regulation change, and importantly is then driving more than a simple “there’s been a change” message? How will a law firm of the future manage changing regulation?

Efficiency and technology

Efficiency is just sensible business practice. And Technology is the great enabler. The cost of systems and applications to assist the efficient running of a law firm are becoming increasingly affordable. There’s a huge range of choice. You largely get what you pay for, but there are now products which even the smallest firms can utilise to gain better management information and provide optimal service for their clients.

  • Over the next three years, will you have embraced some of the toys now available or on their way?
  • Will you have attempted to stay informed on the topic? And before technology can be sensibly deployed, ask yourself whether you truly understand the nuts and bolts of what you do.
  • Is every element of your process being handled by the right level of person? Or do you have partners still doing tasks that an office junior could perform?
  • Have you considered outsourcing non-core activities such as cashiering (obviously!), compliance, HR, marketing?
  • Are your lawyers busy being lawyers and are they making the best of the tech you are giving them?

Business performance and risk management

Is your firm profitable? And if so, have you asked yourselves whether it is as profitable as it could be? Is it resilient- cyber secure, IT robust? Are staff motivated and part of a team with a truly aligned culture? Over the next three years, what measures will you use to assess these things? Have you even planned to assess them at all?

A practice which optimises its profitability will be considering all of the questions I’ve raised and more.

There are so many unknowns, and sometimes it’s easy to treat these questions as such. But there is knowledge and guidance available. There are lessons to be learned from the past couple of decades. And there is a power to questioning your own position and considering what you’ll want to look like in three years. So how will your law firm of the future look like?

For me, I’m still hoping there will be hoverboards 😉

Alex Holt, The Cashroom

The Cashroom Ltd

The Cashroom Ltd exists to deal with the day to day administration of a law firm’s finance function, ensure compliance with the Solicitor’s Accounts Rules, and provide firms with management information and Management Accounts.

Our legal cashiering service, for almost 150 clients in the UK, is delivered remotely by a team of qualified cashiers, working in our offices using the client’s own practice management system.

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