Is Your Firm Best Run As a Dictatorship?
The legal sector is the only business sector that is still a democracy, says Cushman & Wakefield Legal Sector Advisory Group leader Sherry Cushman. (If your firm is the exception to this statement, sorry about that. Unless you're the dictator.)
Every other business entity is run more like a dictatorship--a set of leaders making decisions in only the best interest of the business, without seeking opinions from others in the company. That model creates much more uniformity between companies in the same industry, with regard to real estate decisions, for instance. In the consulting industry, Sherry tells us, companies are spending within 1% of each other on real estate as a percentage of gross revenue. With more decision-makers contributing to real estate decisions in each law firm, there's a 3% to 6% spread.
The data comes from the just-released second national survey on the legal industry from Cushman & Wakefield's legal sector advisory group. Sherry says law firms are shifting their real estate decisions to how they'll support the business and the client, not the individual attorney. A majority of respondents said real estate decisions are influenced by client demands, largely technology expansion and reducing real estate costs and "show space." Last year, just 12% of respondents said their firms would implement limited firm-wide hoteling in the next 10 years--this year, that number jumped to 49%. (This graph shows resources required to hotel.) A large majority of respondents--75%--said they believe the firm will implement one-size offices for partners and associates.
Some other revelations in the study: The biggest issue impacting business competition this year shifted from recruitment and retention to competitive fee structures. Other top priorities were high overhead and IT security. The survey also found that only 51% of respondents believe the traditional partnership structure will stay the same (down from 77% last year). C&W and ALM Legal Intelligence spoke with attorneys from over 400 firms, from global to local. The company is taking its results on the road, with Sherry conducting symposiums in law firms, starting in NY, Minneapolis and Tampa.
