Are you shore …?

Yet more news emerges of large commercial law firms setting up “near-shoring” or flexible resourcing operations. The idea, presumably, is to be able to carry out lower value work at a lower cost, freeing up the more costly resources to do higher value work. By “more costly resources”, we’re probably talking associates (and possibly more junior partners).

It follows that these associates have over the years being doing lower value work than perhaps they ought to have done. More significantly, if these alternative models are successful in achieving their objectives then the result will be less work for them.

This tempts the question how will this work be replaced ? I’m sure the aim will be to win more higher value work, but as more and more firms adopt this model it will become the norm, not a differentiator. They can’t all increase their share of a finite market.

How then will firms adapt to this self-inflicted work redistribution conundrum ? Will they reduce hourly billing targets – and corresponding revenue – to more civilised levels ? Will we see pay cuts ? Or even redundancies ?

It seems unlikely that high value work will cascade down from partner level, unless the plan is to free partners to do more “rainmaking”. Of course, more and more firms are also increasing their specialist business development teams, doing the rainmaking at a much lower cost than partners.

I can see the law firm of the future being less top-heavy, with partners not being judged on rainmaking or hours billed, but on the ability to effectively and profitably select, deploy, manage and nurture teams of less experienced lawyers, while progressively building the firm for the future. I’d suggest this is a more healthy strategy for the individual, the firm and the effectiveness of the market.

As firms follow the crowd and join the queue to set up their “near-shoring” and flexible resourcing operations, you have to wonder whether they are really looking any further ahead than the firm in front of them ?

2014 in review

The WordPress.com stats helper monkeys prepared a 2014 annual report for this blog.

Here’s an excerpt:

A New York City subway train holds 1,200 people. This blog was viewed about 4,500 times in 2014. If it were a NYC subway train, it would take about 4 trips to carry that many people.

Click here to see the complete report.

Social media – are we learning anything yet ?

Yesterday I had the pleasure of attending an event organised by the Institute of Barristers’ Clerks (IBC) for in-house lawyers, barristers and clerks (or practice managers, directors etc.). The aim of the event was to increase and improve all round awareness and understanding of the needs of in-house lawyers and the Bar’s capability to meet them.

The first thing I should say is that this was an excellent initiative by the IBC. The Bar as a group has been very poor at promoting itself to this highly significant and influential segment of the market, so the IBC deserves to be commended both for the initiative and for some top class organisation and execution.

But I am not going to write about the event itself. I should make absolutely clear that this is not any reflection on its quality. On the contrary. As I said, it was very well conceived and executed. There were insightful and expertly delivered presentations, from experienced, senior in-house lawyers, a barrister and an academic. There’s no doubt about it: the event itself was a great success.

However, as I listened to in-house lawyers talk about the challenges facing them – internal pressures to articulate their value, the need for external lawyers to understand their business, be commercial, not reinvent the wheel, recognise what value means from their perspective, and so on … – it struck me that anyone, like me, with an interest in the commercial legal market who puts any meaningful amount of time and effort into engaging on social media will know these things inside out. If you are reading this – and the chances are you are – it is likely you fall into this category and will have nothing to learn from my reciting these well-versed issues.

For my part (and maybe I flatter myself) I felt as though I knew more about the challenges facing in-house lawyers than the in-house lawyers presenting to me. To be clear, I am not and never have been any kind of lawyer, in-house or otherwise. It is only fair to add that while I have learnt much through digital channels I also have a huge advantage from my fortunate involvement in the LBC Wise Counsel program for in-house lawyers. But that in itself came about through social media connection, which underlines my point.

But what is my point ?  It’s this: it exasperates me is that people continue to ask me what is the actual value of social media and how do I get the time to use it. My answer is invariably another question: how do you have the time not to use it ?

I hope this serves as a good illustration.

“New normal” or business as usual for the Bar ?

While the Bar is widely perceived as being a “traditional” profession, I am of the view that many overlook the fact that it has long been operating in a highly-demanding marketplace and is thus well-equipped to cope with the current “new normal” market conditions which the wider legal services market seems to be only just waking up to.

Here is the link to my article on the subject for LexisNexis Future of Law blog.

Public Access to the Bar – main event or sideshow ?

Recent headlines seem to suggest that the Bar is gearing up to “by-pass” solicitors and embark upon an all out war with them for business in these increasingly competitive times. This is on the back of figures published in a recent joint Bar Council and Bar Standards Board report, projecting that the number of barristers qualified to conduct Public Access work is set to rise from the current 20% to 50% by the end of 2015.

Public Access is therefore increasingly being talked about as a major opportunity for the Bar and threat to solicitors. But how informed is this debate ?  Is there a genuine market shift in play or is this merely paranoia-induced hype ?

What is “Public Access” ?

Put simply, Public Access means accepting instructions from a lay client, as opposed to a professional one. “Professional Client” is defined quite broadly in the Bar Handbook, but in reality it means solicitor in the vast majority of cases.  What being “instructed” by a solicitor actually means is surprisingly unclear in the Code of Conduct, but I think it is generally taken to mean receiving instructions, papers and/or information on the authority of a solicitor, whether or not the preparation is actually physically done by a paralegal, legal secretary or other person within the organisation instructing.

Relevance to the market

I think it is important to point out here what types of work barristers can already do without being authorised for Public Access.  Here, I think the waters have been muddied by the common reference to “direct access”, which has no prescribed definition.

First, barristers have always been able to accept instructions from large corporations or indeed any organisations that have their own in-house legal function (assuming it contains a qualified lawyer).  Some of the largest corporations (notably banks, insurers and utilities) and public bodies, with a regular requirement for litigation services have instructed the Bar directly (ie. without the involvement of a private practice solicitor) in large volumes for many years. And I mean many years – certainly dating back to the 1990s if not before. Public Access is therefore of no relevance to this significant segment of the market.

Secondly, since the International Practice Rules were introduced around 15 years ago barristers have been able to accept instructions directly from overseas lay clients (although this excludes litigation after the point of issue of proceedings, when a solicitor is required).

Thirdly, again for about 15 years, barristers have been able to accept instructions directly from members of various recognised professions, such as accountants, tax consultants, surveyors and architects.

All in all, this renders Public Access completely irrelevant to a significant part of the legal services market.  This does of course still leave the not insubstantial domestic consumer and SME markets, but it is important to set the context for any debate about threats or opportunities presented by Public Access by first recognising the restricted reach of its potential impact.

Authorisation for Public Access work

The position, particularly with regard to the perceived threat to solicitors, is put further into perspective when you consider what qualifying for Public Access actually entails.

Basically, it involves paying a fee in the region of £400 in return for a 1.5 day course.  For many barristers, this is a relatively small investment of time and money particularly when you consider that it also takes care of a full year’s worth of CPD points.  I’m not sure it requires a decision of any great magnitude to embark upon this and I believe that many barristers will not do so because of any great appetite for Public Access work, but rather they are happy to leave the door open for opportunities of special interest or those that may come at a convenient time, when business is otherwise quiet.  To use the ubiquitous taxi metaphor, it’s like turning the light on but leaving the taxi in the driveway.  (Having gone down this route, I should add that the controversial “Cab Rank Rule” does not apply to Public Access work).

Where I’d suggest the debate has got a little hysterical, is the widely reported perception that the increase in Public Access authorisations represents a wholesale strategic re-positioning of barristers’ business plans with a view to a major onslaught on solicitors’ territory. More likely, it is a sensible investment of relatively small amounts of time & money to put oneself in the frame, without obligation, for possible opportunities while meeting mandatory CPD requirements. Along the way, one might also learn a bit more about client engagement and gain a better understanding of some of the work of solicitors. In my view, “taking over the world” does not feature highly in the list of reasons to go down this route.

Appetite and capability 

There does however seem to be an increasing appetite at the Bar for Public Access work and the profile of this route to instructing a barrister has certainly been raised in recent times, not least through the proliferation of web-based marketing portals for barristers.

I’d suggest the vast amount of the buying market does not particularly want to buy “Public Access”. More likely, they have a legal problem, to which they need an effective solution at the right price. That best solution can of course in many cases lie in Public Access, where it is primarily advocacy that is required or specialist discrete advice is needed in scenarios where the legal problem can be clearly identified and “packaged”. There is also the overlap between the work that both barristers and solicitors can do where they tend to be equally-suited (eg. advice on tax or company law). Here, competition is surely a good thing.

Despite all this, I cannot help thinking that it all boils back done to the basic and obvious point that the Bar is all about advocacy. Advocacy is a specialist and demanding discipline, both in terms of training & skills required to do it well and also practice management revolving around tricky diary management of multiple practitioners often in scenarios where courts are increasingly less inclined to flex to accommodate advocates’ availability. Any successful advocate will tell you that preparation is paramount and that time allocated for this is pretty much “sacred” in the diary to the exclusion of almost everything else. Many solicitors will tell you it is the existence of practical constraints of this kind that is the reason why they seek services from the Bar, in addition to the small matter of simply not wanting to do advocacy work themselves.

While inevitably a generalisation I make no apology for stating my view that barristers are simply better advocates than solicitors. An obvious and uncontroversial conclusion, I would have thought; more so perhaps if I remove the labels and say that those with the desire, aptitude and training for specialist advocacy are better at it than those who have none of those things. You could turn this into a debate about “fusion” of the profession, but I would simply point to the US: there are those who are specialist trial advocates and those who are not.  It’s just that the divide is less visible and the labels are less distinct.

Challenges for the Bar

So yes, Public Access is a good thing for the consumer seeking advocacy services in cases which they are either competent to prepare themselves or need little preparation. I make that qualification, because often a client will not know how to prepare or conduct a case to trial or even know what facts & documents are relevant or, significantly, what they don’t know but should explore. Here we are in the territory of solicitors, for whom building, preparing and conducting a case is the day job. While this work is undoubtedly not beyond the capabilities of many barristers, it is not naturally an easy fit.  It dilutes the advocacy specialisation and their self-employed status makes this sort of activity impractical to service on a regular basis.  And no, generally speaking they are not as good at it as solicitors.  (Of course, the impending ABS regime for barristers may create opportunities here, but as with any opportunity it comes with risks.  A subject for another post …)

Other potential barriers to success in Public Access often cited are the inability to handle client funds or to deal effectively with lay clients.  The former issue is now no longer a hurdle at all thanks to BarCo’s escrow account facility.  As for the latter, I have no time whatsoever for this argument.  Solicitors who hide behind this for reassurance – who tend to be the same ones who hide behind anonymous comments on legal media websites – are frankly deluded.  The Bar has upped its game.  I will not explore here the merits of these points; they are put forward as opinions of this impartial observer who has plenty of experience working both sides of the proverbial fence.

The biggest hurdle

I am leaving until last what I feel is the area which will most challenge the growth of Public Access.  Marketing.  I think it is easy to overlook the length and precariousness of the journey of an instruction, from its embryo as a client’s realisation that they may have a legal problem, through to a brief in a barrister’s in-tray (or more likely, Inbox).

In this respect, barristers have the benefit of what is effectively an enormous marketing department, in the form of the 10,000 firms, with a presence every high street in every town, in the cities, spread across regional chains and of course online.  Collectively, they cover every demographic, practice area, consumer type and industry requirement.  Each firm expends to varying degrees time, effort and money on winning business, through a variety of promotional activities as well as the increasingly painstaking effort required to maintain those precious, hard-earned, sustainable long-term client relationships which tend to form the main source of most firms’ income.  Collectively, this creates something of a marketing Colossus that benefits the Bar hugely.  In comparison – and despite commendably increasing efforts – marketing impact and reach of the Bar is minuscule.  It is hard to imagine it will ever approach the scale of that of solicitors and much of the Bar will acknowledge that it will be reliant upon solicitors for the bulk of its business for the foreseeable future.

The marketing of the Bar in its own right is however dramatically improving, with chambers quite rightly aiming to build closer, more direct relationships with its non-professional client base.  Smart sets will be building these relationships to the extent that they are the first port of call for new work enquiries, giving them the option to act directly and/or recommend and bring in trusted solicitors’ firms when appropriate.  In this respect, the balance of power is shifting, which in my view can only be a good thing, as the increasing range of options for selecting a legal team makes the client the winner.

A symbiotic relationship

Of course, law firms will continue to win business from clients who have advocacy and/or specialist needs that they can’t themselves meet, for the reasons explored above. So solicitors will continue to need the Bar, as the Bar will continue to need solicitors. This may yet be challenged by the evolution of new business structures and so it should if this makes for more effective or better value service for clients.

In the meantime, call me old-fashioned but this all sounds to me rather like a recipe for a very well-functioning market.

So, let’s play nicely everyone.