MORE LAW FIRM PREDICTIONS!
In the final installment of our mid-year legal industry forecast series, our own Doug Anderson sat down with the Zeughauser Group’s Norm Rubenstein to get his take on both the national and local outlook for law firms. Based in Washington, Rubenstein specializes in strategic planning, positioning and branding, and client satisfaction management for Zeughauser, a national consultancy focused on law firm strategy and operations.
- Managing partners should not be worried about whether there will be an economic downturn but when there will be a downturn. The legal industry has been enjoying unprecedented levels of prosperity but it will end sooner or later. In 2001, firms were caught badly off guard and had to make painful layoffs at all levels.
- The best way to avoid potential layoffs is to begin planning now by shoring up counter-cyclical practice areas like bankruptcy and certain kinds of litigation, by paying close attention to staffing ratios and leverage, and by training lawyers to be able to shift between practice areas, so when one area slows down and another picks up they can make that adjustment.
- Marketing is becoming a central focus of well-run law firms. Today’s leading law firms are doing an excellent job of distinguishing their brands and clarifying for the marketplace what distinguishes them from their competitors.
- As law firms consolidate and build competitively robust practice areas, it is becoming increasingly important for them to differentiate themselves. How they position themselves and communicate that position to the market is more critical than ever. Points of differentiation might include firm philosophy, practice area mix and footprint.
- Law firms are not hiring sales forces as many predicted a few years ago, but lawyers are increasingly being equipped with the skills to nurture long-term client relationships, to bond with clients, and to develop a deeper understanding of their needs. More than ever before, successful firms are using business development specialists to manage client relationships and to coordinate information.
- There is no doubt that how successful a firm is depends on how well it recruits. It’s a fairly obvious equation and it’s an enormous strategic issue facing all firms.
- However, even as the war for talent heats up, firms need to avoid the temptation to hire laterals that are not a good cultural fit. These kinds of hires may be a good temporary solution but in the long run, firms need to protect their cultures and they should invest in lateral hires that they believe will stay with the firm.
- Today’s GCs are more powerful than their predecessors and more sophisticated in how they purchase legal services. GCs increasingly are looking for firms that understand and care about their issues and have the proven resources and expertise to handle their issue. They want to be able to sleep soundly at night knowing that each of the firms they have engaged has them covered in the specialized area for which they were selected.