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Avoiding Extinction:

Avoiding Extinction:

 

Hardcover: 208 pages
Publisher: American Bar Association (15 Oct 2012)
Language: English
Available online at Amazon: Buy Now
 

“[W]e re-imagine the whole process”
 
Mitchell Kowalski’s attempt to offer up a vision of the law firm - legal service company - of the future builds on some of the ideas put forward by Richard Susskind in his book The End of Lawyers. As with Susskind, Kowalski sees the traditional law firm at an impasse:  old attitudes and practices followed just because ‘we have always done things this way’ and management structures that act against the long term benefit of the firm, are, he believes, the things that will bring traditional law firms down.  One look at recent events at Dewey & Leboeuf should act as a wake-up call for those who would dismiss the idea out of hand.
 
In Kowalski's world the only firms that will survive and thrive in the future are those who are sensible enough now to discard traditional practices and embrace: the cloud (Software as a Service), value based billing, a corporate structure, open forums, Knowledge Management at heart of everything they do, open plan working, business-casual dress,  a paperless office, mentoring, online, interactive (game-play) training and education, and legal process outsourcing.
 
How Kowalski makes this point is interesting. Unlike previous books on the subject, Kowalski has chosen to write his book as prose, rather than straight non-fiction (I suspect he is a frustrated John Grisham at heart). He wants to illustrate his points with  characters and scenarios. To do this we are introduced both to the fictitious law firm of the future:  Bowen Fong & Chandri (BFC) – and a new associate joining the firm  and to the potential client of the future, Kowtor Industries, and its general counsel considering which firm to retain.
 
The book starts with the client: Kowtor Industries, immediately making the point that this is also where the law firm of the future should be starting: with the client.  They brainstorm what they would expect from the ideal law firm.
 
I can see this section being a must read for General Council, as it is a reminder to them that the legal service is exactly that – a service. They should be as thorough in getting information from their prospective law firms about the services provided and how much, for example, the firm spends on know-how, or what technology they use, as they would be with any other service vendor. In the words of one of the Kowtor Industries characters they need to take charge and be drivers, not chauffeurs.
 
When we move onto BFC for the first day of a new associate joining BFC we start the address the structural and cultural side of  what Kowalski thinks is wrong with traditional law firms. 
 
Unsurprisingly, the two key issues still being avoided/ignored by traditional law firms are Partnership Management and the Billable Hour. 
 
Kowalski’s firm of the future is not managed by the partners who he sees as a group that is always going to contain a large number who are disincentivized to “act in a way that assures the long-term interest of the firm, because acting in the long-term interests of the firm will reduce the amount of money that each lawyer makes in the short term” He posits that most people wouldn't expect pilots to run an airline or engineers to run a transit system, so why do we expect lawyers to run a law firm? Self interest – especially in large firms – means you can't react quickly to change:  “Agility is simply not possible in a large partnership structure where partners can derail a proposal because it will reduce their draws.”
 
Of course in the UK, the Legal services Act 2007 brought in the concept of Alternative Business Structures (ABS) for law firms, which allows for non-lawyers to have a role in the ownership/management of UK law firms. Whilst a handful on very small firms have converted to ABS there seems to have, as yet, been no appetite amongst larger firms.
 
Interestingly Kowalski's ideal firm BFC is run by an independent board made up of General Counsel's from other businesses (although this precludes those businesses instructing the firm whilst they are on the board to avoid conflicts).This also seems to ignore the fact that you are also potentially alienating any main competitors of those businesses those GC's come from as clients as well.  
 
The billable hour and timesheets meanwhile are both described as tools used to dehumanise lawyers, and to concentrate the firm and lawyers on meeting ‘billable’ targets and meeting the law firm's needs rather than the clients. What timesheets say to lawyers is that their firm doesn't trust them to do their job. It has no faith in their ability to do good work that meets the client's needs.  It is more interested in quantity than quality "If a lawyer creates a benefit that cannot be measured in a billable hour, that effort is worthless".
 
Most law firms would, no doubt, claim clients like the billable hour, and I think there is an argument that many clients have, in the past, been complicit in accepting it as a billing structure, but I find myself in agreement with Kowalski when he argues that it is a structure that certain doesn't benefit the clients, and whilst the quality may also be there for some firms, does clearly put quantity before quality.
 
Billing should be value-based and not time based according to Kowalski and firms should be using legal-project management  for the control and management of legal matters and the costs involved.
 
The importance of knowledge management is also stressed highly with contributions actually being a meaningful key component of appraisals – as opposed to the lip-service approach it currently gets at best in most law firms.  He realises that what firms are selling is their 'knowledge' and "only when KM becomes integral part of professional life that KM, you and [firm] will succeed"
 
I totally agree with this. You key differentiator as a firm is 'what you know' and how you can use that knowledge for the best interest of your clients. It's also important that this knowledge is current and evolving and that it can be easily packaged and sold on to clients. The same is true of eLearning modules and other training.  Knowledge is a law firm's product and they should be selling it to clients in any way that will help those clients, and adds true value.
 
This book is an easy, one sitting, read. It nicely brings together a number of ideas and theories that have been espoused in recent years about how law firms should be looking to adapt if they are to survive, and fleshes them out in a light and entertaining narrative. 
 
Many of the ideas mentioned in the book : open plan working, open forums, dedicated elearning programmes etc  are already being used in many law firms, you may work in such a firm – I do. However the point Kowalski is trying to make seems to me to be that whilst any firm can become a firm of the future and do things better faster cheaper, they wont get there useless they let go of the dual stones around their necks of the partnership structure and the billable hour.  
 
My only real problem with the book was with BFC’s Senior VP for Knowledge Management. Even excepting the different interpretations of the word 'spunk' between Britain and North America  I can't help but think that the name decision to call him Barry Spunker was not a very inspired move if you want a global audience to take your message seriously. 
 
Well worth a read, whether you're an associate, partner, general counsel or anyone else with an interest in the future of legal service provision.
 
Scott Vine

 

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