The profession of law is consolidating, and increased competition for business is putting profits under pressure and creating a need for firms to market their services more actively.
At the same time, clients are becoming more demanding, seeking a global service and a legal partner capable of meeting their increasingly complex needs. The ability to cope with multi-jurisdictional, multi-skilled work, over longer time periods and involving complex relationships, is key. Working practices are changing, both with clients, in terms of online services and electronic communications, and within the firm itself, in terms of improved leverage of knowledge.
Thesefundamental shifts are forcing legal firms to operate in new ways. Andif a law firm is to bring about the changes necessary to ensure its future position, it needs an exceptional service from its support functions - human resources, IT systems and finance.
In determining the way forward for firms in response to these challenges, it is helpful to draw lessons from other professional services areas, such as consulting, finance and accounting, which have experienced comparable pressures over the last decade.
Thelessons to be learnt are:
- a tailored business infrastructure is required, which enables the law firm to leverage its knowledge and manage its performance;
- a strong project and programme management capability must be developed internally to deliver the increasing number and complexity of changes required by the business;
- a consultancy-style relationship should be fostered between the support functions and the rest of the law firm, so that business needs are supported more effectively.
A tailored business infrastructure
The growing need for sophisticated information systems has created a dilemma for the legal profession.
Although a vision of future infrastructure needs is often clear, and includes such components as knowledge intranets, information management systems, client contact systems and resource management systems, the ability to deploy a common infrastructure within the business can be a fraught exercise.
The reasons for this are complex. Individual practices within the law firm and individual regional operations are strong business units in their own right, and will have a firm hand in business-wide matters, which can in turn make business-wide decision-making a complex process.
Different legal practices have individual house styles and standards which make the sharing of information across functional or regional boundaries more complicated. Furthermore, in a profession characterised by precedent and tradition, the transition to any common format will typically be a lengthy process. Processes within a legal company are rarely common across functions, a situation exacerbated by growing international divides as firms consolidate in the market. Without some degree of commonality in processes and standards, the ability to provide systems support across the board reduces, and as a result the complexity and cost of systems increases as exceptions need to be built.
The resistance to change in law is greater than in many other industries, since any activity that disrupts or interferes with client business - and billing of time - has a direct impact on the bottom line.
The most appropriate business infrastructure to meet these requirements must be a pragmatic solution that balances the vision of the firm with an understanding of what is realistic. It must achieve a compromise between increasing the ability of the organisation to share information more widely - and therefore optimise firm performance - and minimising bureaucracy and the need for the unnecessary standardisation of process and standards.
Strong project and programme management capability
Within any business, the support functions often bear the brunt of the delivery responsibility for major business initiatives, such as integrating mergers and acquisitions, providing support to the establishment of new services and capabilities, and delivering business performance improvement projects. If these are to be delivered successfully, then the functions themselves need to develop a greater 'projects culture'.
This culture requires that project and programme management systems, skills and processes are actively developed within the business and people are given the necessary responsibility and authority to deliver.
This will often mean that the style of working in the support areas will change, with people taking on far greater responsibility (often beyond the scope of their specific department) to deliver solutions to the firm.
Portfolio management and resource management processes are fundamental to this way of working, the former to balance conflicting urgent priorities and the latter to ensure that valuable resources are directed to the right place. This way of working also requires that people work far more flexibly, often taking on several roles simultaneously as they work across a number of projects, geographies and practices.
Consultancy-style relationship
So that the quality and value of the services provided by any support function to the business is maximised, a move toward a customer-supplier relationship is required. The work that support functions undertake for the rest of the firm tends to fall into two categories, which each require a particular type of relationship.
The first area of work comprises the comparatively routine and process-driven functions such as personnel support, IT helpdesks and so on, which can be effectively managed through service level agreements and delivered through in-house call centres or outsourced agents.
An early example of this was the now common outsourcing of payroll functions; but many firms are now taking the concept much further to include many of the more routine human resources, IT and property functions.
The second is the higher value added work, typically more forward looking and proactive, where support is provided to improve the performance of the firm and help deliver against its overall business objectives.
Examples of this are where the support functions are key to the delivery of the firm's business strategy. This includes the integration of mergers and acquisitions, revenue enhancement or cost savings programmes or developing knowledge management approaches for the firm.
This is where a consultancy style of relationship can add immense value. Here the support areas can help identify opportunities to raise performance and then work across the firm to specify issues and develop solutions. This can then lead to the support areas working as a client on behalf of the firm, mobilising and managing the support department to ensure the delivery of solutions and the realisation of the targeted performance improvements.
As the profession of law continues to change, so the quality of support it demands becomes ever higher. Such support plays a vital role in enabling new ways of working to be established, and ensuring that maximum value is delivered. And this presents a significant challenge to the leaders of support functions.
