In August 2018, I was fortunate to not only attend but also present (on pricing transformation) and Chair Day 1 of Chilli IQ's 6th Managing Partners Forum for Boutique and Small Law Firms at the Mansion Hotel Werribee Park.
The theme of the forum was "Competition as a Motivator for Change."
Andrea Foot from Leaf Logic has already provided an excellent video overview of her highlights from the forum which can be found here. Without taking anything away from any of the excellent presenters, my personal key highlights & take outs from the 2 day event were:
- The forum got off to a great start thanks to the well connected, well researched, well informed and incredibly talented Eric Chin who provided attendees with an overview of his proprietary research and insights into what is shaping the $23B Australian legal industry, what it looks like now, what it might look like in the future and what might be some of the opportunities that smaller firms could tap into.
- Jamie Prell, GC and Legal Director from LOD, facilitated a panel session comprising Pip Murphy Director Legal from TSM Advisory, Andrew Brookes Principal at Hive Legal and Anthony Curtin from Merton Lawyers each telling their personal stories on their respective firms’ growth - their challenges and their successes.
- If you have not heard Paul Hawkins, the Chief Combobulator from CRAZY MIGHT WORK, you are missing something. He took us all on a journey of innovation and then had us doing some competitive group innovation brainstorming (I was fortunate to be part of the winning team). This exercise shows what can be achieved when smart people are motivated and work together as a team.
- Many of you would have heard of Dr Bob Murray before and may have worked with him. As a behavioural scientist, he provides a different humanistic view of legal world. We are not in the business of law but in the business of supportive relationships according to Dr Bob and once you decide what business you are really in, you can better understand who your real competitors are. And he is right.
- Tech wizz Phil Scorgie explained how you no longer need to be a big firm to afford and utilize powerful legal tech by highlighting some of the brilliant cost effective technology now readily available to firms of any size.
- Ray D'Cruz, CEO Of Performance Leader, talked about something close to my heart - AAR's - After Action Reviews - the greatest learning tool ever. AAR's are structured de briefs where project team members discuss what worked, what didn't work, what should be done differently next time and what was learned. I genuinely believe all professionals should engage in AAR's as the benefits to the firms are enormous. Performance Leader's software is a great advance for AAR's - simple to use and best of all it captures what was learned from each project so that any learning can be easily shared around the whole firm.
- Chris Monk from DECODED gave the best down to earth presentation and explanation of Blockchain technology (and the Island of Yap!) I have heard, as well as pointing out some of the myths and realities of Blockchain. As Chris said, for many Blockchain is a solution waiting for a problem. But if you have a distributed ledger with multiple users and potential trust problems, Blockchain may be an answer - otherwise just retain normal ledgers.
- Founder of innovative Newlaw firm Legalite, Marianne Marchesi, also gave practical insights into how she utilizes digital technology in her practice and showcased some of the platforms that can make any small firm keep up to date with tech savvy clients but stand out from the crowd.
In my introductory opening as Chair on Day 1, I mentioned that it was Bill Gates who said:
“We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don't let yourself be lulled into inaction.”
I believe this is never truer than in the legal profession in 2018. I spoke at Chilli IQ's 1st Boutique & Small Law firms forum in 2012 and highlighted to attendees some of the substantial changes our profession has undergone in the last 6 years.
Fast forward to 2018
The theme of the forum “Competition as a Motivator of Change” perhaps says a lot about 2018. It is a hyper competitive market (as Eric Chin went on to highlight in his examination of the market) but the external competition in 2018 is different - vastly different - to the external competition many law firms faced in 2012.
Leaving aside the partners in many Biglaw firms that compete internally against each other for clients, work, recognition, income and status - no law firm & no lawyer, any longer just competes against another lawyer or law firm for work.
In 2018 lawyers compete against accounting firms, consulting firms, financial institutions, online providers, match making websites, tech companies, in house, “non-lawyers”, the regulators, social justice activists, and a variety of other so called “disruptors” that don’t even look remotely like you.
Lawyers even compete against their own clients
Your clients - in making a decision to do nothing - not to seek legal advice because it is too expensive, because they don’t think a lawyer can provide a solution to their problem or because they don’t like your service ethic - is competing against you. Your clients do not compare you to the service they receive from other law firms. They compare you to the service they receive from anybody, any organisation, that adds value to their business.
When I was a practicing lawyer I used to, naively, believe all the rules and regulations that ensured only lawyers could provide “legal work” (whatever the hell defines “legal work” these days) were in place for the protection of consumers and society against those evil money grabbing Johnny come lately “non-lawyers”, that were going to do terrible things to “our” clients.
Now I realise that most of those rules and regulations - fostered initially by the Law Guilds and perpetuated by the regulators - were, in the main, there to protect, prop up and quarantine the legal profession from real competition.
Don’t get me wrong Australia leads the world in having broken down many of these barriers so that consumers get better choices and a more level playing field.
Does that make it easier or harder to practice law in 2018 compared to 2012? Depends, I think, what market you wish to play in and where you perceive you want to position yourself in that market.
Even though my background was in Biglaw, most of my involvement and focus in the last decade has been with boutique small and specialist professionals. They are the ones that are at the coal face and I believe can and are genuinely making a difference to the future of law.
Sure it is nice, and very comfortable, to be on the deep pocket Biglaw cruise ship, but when it comes to agility, taking risks, being entrepreneurial, making quick decisions, easy access to technology, being curious & open minded, knowing what it is really like to win and lose a client, the importance of cashflow, and being more aligned to, and being in genuine longer term relationships with clients, let me absolutely assure you, boutique & small firms win hands down.
I made plenty of mistakes as a Managing Partner and CEO of law firms. One big mistake was to partake in endless benchmarking studies which purportedly pitted my firm's performance against other law firms (and only other law firms). All this institutional copying did, was to try and make us all look the same. It was always a race to mediocrity.
Another huge mistake was to try to emulate, replicate and copy big Biglaw firms. Oh how we worshipped them and wanted to be one of them. Absolutely big firms do some things amazingly well. They have huge numbers of smart intelligent hard-working lawyers they can throw at big projects, they have very deep pockets, and are extremely well connected and respected at the big end of town through quality work and exploiting the lawyer to lawyer buy and sell model very well.
But my advice to good boutique and small firms is not to seek to be the same or try to better Biglaw by competing on their turf or trying to match their strengths. They will always win out. Their measurements and rewards for what success looks like will not work for you and should not be your definition of success.
Instead, seek to be different, authentic and most of all focussed on your team members and your clients’ well-being. If you focus on their well-being yours will follow.
Seek out and nurture genuine - not transactional – relationships, with people who think like you, encounter similar challenges and opportunities that you have, but most of all clients who like what you stand for - your purpose, your why.
You will be dealing with a true economic buyer and a buyer which is seeking from you, both tangible and intangible benefits from the relationship. Your investment in them and their investment in you should be valued over the lifetime of that relationship - not every 6 minutes.
But your real competition will not be from anything external. Your real competition will actually be internal - from within. Your prime competition will be that little voice of self-doubt in your head that says you are not good enough, that you cannot do it, that no one else has done it. Your own perception of self-esteem and self-worth, your fear of rejection (we lawyers hate rejection), the natural pull towards safety in numbers and being accepted as part of “the club” is significant. Add to this our inherent conservatism as professionals and the fear of risk taking per se and you have the ideal recipe for achieving mediocracy but little more.
I only remember one book I read at High School and it was a book written by Tomasi de Lampedusa in the 1950’s titled “The Leopard”. The novel is the story of the Prince of Salina, a 19th-century Sicilian nobleman caught in the midst of civil war and revolution. As a result of political upheaval, the prince's position in the island is under threat from new moneyed peasants and "shabby minor gentry". The Prince is forced to choose between upholding the continuity of their upperclass values, and breaking tradition to secure continuity of his family's influence.
There is one quote from the book which I assume many of you have heard, where Tancredi, the Prince's nephew, says to his uncle:
"Unless we ourselves take a stand now they will force the republic upon us. If we want things to stay as they are, things will have to change. Do you understand?"
Owners of boutique and small firms - the republic is at the gate. Make your stand.