Managing Legal

December 6, 2019

Amazon and (a Truly) Innovative Law Firm Join Forces

When Amazon announced a group of selected law firms to provide trademark registration services at pre-negotiated rates for small- and medium-size businesses with whom it works, it featured law firm FisherBroyles — what one commentator last year called, “The Most Important Law Firm You’ve Never Heard Of”.

Amazon’s goal, according to legal innovation and tech expert Bob Ambroggi:

To help companies more quickly obtain IP rights for their brands and access to brand-protection features in Amazon’s stores. It specifically targets small- and medium-sized businesses by making it easier and more cost effective for them to protect their ideas.”

I’m a business attorney who was schooled in basic management skills only after being thrust into P&L duties after practicing law in a conventional law firm. During my first 10 years practicing law I was blind to the ways that conventional law firms’ and in-house counsels’ adherence to the billable hour, purposeful overstaffing & duplication of effort, insertion of inexperienced lawyers alongside those capable of working on their own, and slow-walking of accuracy-enhancing and labor-saving tech adoption — advantage the attorney — and disadvantage the business client.

This quote from FisherBroyles’ founders illustrates why I find their way of doing legal work true innovation instead of hype:

“We took away the two most inefficient aspects of the law firm model: The expensive fixed cost real estate, and the $180,000 a year associate [junior lawyer] being trained on the client’s dime. And once you eliminate those two massive aspects of law firm overhead, that leaves a lot of capital revenue to pay your lawyers more.”

December 4, 2019

The Legal Profession has Barely Changed in Years, Despite Hype about Innovation in its Services to Business

by Joel A. Webber

Too many businesses find that they spend too much on lawyers — and get too little risk protection in return.

But their executive management should not look to attorneys — outside or inside their companies — to fix this on their own any time soon.

At least not without relentless prompting from business leaders.

Only a minority of attorneys practicing in law firms offer business clients alternatives to the billable hour, to purposeful overstaffing & duplication of effort, to insertion of inexperienced lawyers alongside those capable of working on their own, and to the slow-walking of accuracy-enhancing and labor-saving tech adoption.

And only a minority of in-house counsel are making meaningful demands for such alternatives. Though you might expect that in-house counsels’ outlook might align with that of the P&L executives for whom they work.

In a recent Twitter conversation (here and here), a handful of this minority agreed that long-ballyhooed legal innovations have yet to arrive.

April 4, 2019

I’m on vacation from April 3 to April 11.

by Joel A. Webber

March 18, 2019

Defining the Value of Lawyers’ Work: Where to Get Reliable Numbers for Sound Management Choices (Part 3 of 3)

by Joel A. Webber

A final installment in this three-part post.

What’s a practical basis for placing a value on attorneys’ work for the business?

In Part 1 I addressed the legal profession’s prevailing measure of lawyers’ work:

How long did the attorney decide to take doing the job?

Cost-plus. Bill the client company by the hour.

In Part 2 I addressed “data-driven” methods (with at least one present-tense exception that I’ve found, put this under the heading of maybe-in-the-future).

…

Here in Part 3 I address:

A price agreed in advance — between lawyer and client.

An example:

…

Barlit Beck, LLP

From Fred Bartlit’s April 5, 2010 Orr Distinguished Lecture at the University of Tennessee Law School:

In the early 1980’s Chicago trial lawyer Fred Bartlit was head of litigation at one of Chicago’s finest firms. He’d brought in a client whose big case was keeping 8 partners and 30 associates busy for months. “My partners loved me”, he said.

But Bartlit felt that this firm could deliver more effective legal representation to its clients for less money.

March 15, 2019

Defining the Value of Lawyers’ Work: Where to Get Reliable Numbers for Sound Management Choices (Part 2 of 3)

by Joel A. Webber

In Part 1 I addressed the need for reliable numbers relating to the value of legal services.

If what gets measured gets managed — and if measuring the wrong thing is worse than measuring nothing at all — then client company executives need a reliable measure of the value of legal services in their budget.

Toting up hours billed gives “certainty” about the method by which attorneys came up with the price that they charge to a client company.

But that total tells us nothing about the actual benefit received by the business.

Hence our consideration of two alternatives: “Data-driven”, and a price agreed in advance.

…

“Data-driven” calculation of the value of lawyers’ work for client companies.

I refer to “data-driven” in quotes because there’s (a lot) less here than meets the eye when you read legal profession headlines.

In fact, I’ve found just a single instance of data-gathering and analysis as the basis of determining the value of what attorneys do for a company. If I’ve missed something, I invite comment and correction on this point.

March 13, 2019

Defining the Value of Lawyers’ Work: Where to Get Reliable Numbers for Sound Management Choices (Part 1 of 3)

by Joel A. Webber

“What gets measured gets managed.”

March 11, 2019

Clients Need Legal Services But Not Necessarily Lawyers (Part 4 of 4)

by Joel A. Webber

This four-part post’s premise:

A company’s “legal” problems are likely to be — in functional terms — business problems that have a legal aspect.

The traditional impulse to call in a licensed attorney from a law firm or in-house counsel department doesn’t always lead client companies to the most practical choice for their needs.

Hence my introduction of “Alternative Legal Services Providers”, or “ALSPs” — and Georgetown Law Center’s recent, authoritative survey, “Alternative Legal Services Providers 2019” — in this four-part post.

…

Here are four take-aways:

March 4, 2019

Clients Need Legal Services But Not Necessarily Lawyers (Part 3 of 4)

by Joel A. Webber

OK.

Review of Part 1 and Part 2 of this four-part post:

1. In your company, many “legal” problems are more accurately viewed as business challenges that raise legal issues (as Mark Cohen put it).

2. Delivery of many of the legal services that respond to such business-challenges-that-raise-legal-issues now requires process management and technology skills that attorneys mostly lack (again, Mark Cohen).

3. “Legal services & providers of those [legal] services are ever more important — lawyers, however, are not.” (Jeffrey Carr’s tweet last Monday)

…

For most of the past four or five decades, the phrase “legal services & providers” has meant one of two things:

1. Law firms, and

2. In-house counsel employed by companies as full-time employees.

Until — that is — a few years ago: With the advent of “alternative legal service providers” — or “ALSPs”.

“Alternative” to what? Alternative to law firms and in-house counsel.

Beyond that, the definition is pretty wide-ranging — except that all ALSPs embody the aphorism set forth in this post’s title: “Clients Need Legal Services But Not Necessarily Lawyers”.

March 1, 2019

The Billable Hour Remains the Legal Profession’s Pricing Standard — and Attorneys Use it to Establish Quotas

by Joel A. Webber

I interrupt my four-part post on how a company can achieve higher quality legal services, that are faster, more accurate — and cheaper — by “disaggregating” business challenges that raise legal issues into tasks that (often) someone other than an attorney can do better than a lawyer (“Clients Need Legal Services But Not Necessarily Lawyers”).

…

I saw the following in this morning’s in-box:

“Want a Market-Sized Bonus? Better be Ready to Bill Your Butt Off at this Biglaw Firm”.

For avoidance of any doubt, this meant that a large and prominent law firm issued new, formal guidelines by which it will now require the lawyers they employ (associates) to charge a quota of specified hours in order to receive a particular bonus. I don’t know if this firm previously had such a quota — though they are common in the legal profession. My point here is simply that hourly billing quotas like these are very much a part of the landscape, and that they’re widely accepted among conventional law firms — and the in-house counsel who hire them.

Regarding this law firm and its employee-lawyers, the article included a chart with two axes.

The vertical axis denoted the “level” of the associate in question. “Level” was expressed in terms of years out of law school. Nothing about demonstrated skill or competence. Just: How long had it been since this employee-lawyer graduated with their J.D.?

The horizontal axis: Increasing dollars of bonus for “1,950 billable hours …”, “2,100 …”, “2,250 …”, and “2,400 …”

Raising the question — as use of the billable hour invariably does:

Was this hour billed for the client’s good? Or for the lawyer’s good?

…

I always do a double take at such a headline.

February 27, 2019

Clients Need Legal Services But Not Necessarily Lawyers (Part 2 of 4)

by Joel A. Webber

Part 1 of this four-part post introduced a February 19, 2019 Forbes article, “Clients Need Legal Services But Not Necessarily Lawyers” — by Mark Cohen, both an accomplished business attorney and former chief executive of his own (non-law firm) business.

Part 1 introduced Cohen’s observations about the process management and technological benefits of “disaggregating” what law firms and in-house departments traditionally have viewed as “legal” tasks. In this connection he wrote about “alternative legal service providers”:

“Law is not solely about lawyers anymore ….”

“Several new-model legal service providers … have replaced law’s brute force, labor intensive lawyer-does-all model with data-driven, customer-centric, automated, corporatized, scalable, collaborative, multi-disciplinary, and well capitalized service models. These providers are often managed by business professionals and entrepreneurs, not licensed attorneys …”

…

Why this “disaggregation” of “legal tasks” now?

Because, says Cohen:

“‘Legal problems’ have become ‘business challenges that raise legal issues.’ The complexity, speed, and new risk factors impacting business—together with the impact of the global financial crisis, technological advances, and globalization—have changed the legal buy/sell dynamic.