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Volume 3, No. 4 - June/Juin 2006
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An Orientation for New LawyersRichard G. Stock* This article was previously published in CBA National, January 2005. It has been 10 years since I formally retired in 2015. But of course, nobody retires any longer. I still stay busy occasionally giving advice to lawyers about how they can best capitalize on the business opportunities that their professional relationships and their highly-leveraged environments provide. For 20 years before that, my group advised law firms and their key clients on business strategy and performance opportunities. Some things never change. Trust and personal relationships are still a key factor in understanding why some lawyers are in high demand, particularly for complex, challenging work. But many other aspects of the law firm model have long since disappeared. To begin, the legal-business advisory services are no longer tracked and billed by the hour. Instead, the firm and the client agree upon a fixed amount reflecting the “value proposition” for the work. Corporate and institutional clients learned how to do this by about 2010. They shared their techniques at conferences, in roundtables, and through precedent clearinghouses. Then, a few firms decided they would make it possible for all of their clients – anybody who was buying 10 or more hours of service – to construct their own fee estimate. On-line technology and basic guidelines allowed clients to describe their issues and customize a pricing arrangement that suited their circumstances. At the beginning there was some concern that competitive bidding would be the order of the day. But in the end, the lawyers that won the day were those who had experience in accurately estimating the scope of work and succeeded in delivering the service and results. These individuals proved to be in great demand and had to sub-contract large amounts of their work to lawyers and technical staff in other parts of the world. There were some concerns over quality assurance and service standards. But soon, programs and standards became highly systematic and paid great dividends. A few other important changes took place, but these only became commonplace by 2015. When I retired, the cost of legal services had escalated to such a degree that law firms had to review their legal business model – especially the cost of doing business. Smaller and mid-sized firms around the world were able to attract and pay for top legal talent because they reduced the cost of operations by about 30%. They replaced what were known as secretarial and clerical staff with outsourced technical teams that found, organized, and delivered the client and legal information the lawyer needed to address the legal business matter. This left very little need to maintain support staff at the work place. Many clients reduced their costs by relying on outsourced services themselves before instructing counsel. Clients stopped visiting the lawyer at the place of work some 20 years ago. It was too awkward for everyone. Law firms began to discourage such visits when they found they could reduce about 10% from their legal fees by replacing physical meeting space with electronic and client-based meetings. Still, lawyers have always enjoyed spending time together. As professionals, they learned from each other, but the apprenticeship method proved to be fairly inefficient for sharing and growing intellectual capital. Eventually, learning brokers evolved. The CLE sections of law societies and the for-profit providers like Insight and Canadian Institute merged and were bought out by a division of Thomson-American Express Learning Systems. They customized programs for individuals, groups, and clients to develop knowledge, skills and attributes for lawyers and their clients. Today’s new lawyers seem to have plans for the future. But they also have great mobility because they are able to practice without restrictions across North America and with very few restrictions in Europe and Asia. Law firms have converted their ownership structures to introduce an endless array of equity positions and profit-sharing arrangements suited to their business strategy. You must give careful thought to your own career and financial objectives and then seek advice on where and how much to invest. As new lawyers, you need not spend a lot of time thinking about how law firms used to carry on business. Better to quickly master the relationships and the economics. Adaptability and effectiveness are the only keys to survival in this environment. * Richard G. Stock, MA, FCIS, CAdm, CMC, is a partner with Catalyst
Consulting. The firm has been designated the Preferred Supplier for Legal
Services Consulting by the Canadian Corporate Counsel Association. Richard can
be contacted at (416) 367-4447 or through the website at http://www.catalystlegal.com. Product Review: Interwoven’s New Business Intake and Conflicts ManagerGinevra M. Saylor* This article was previously published in the ABA’s Law Practice, May 2006. Being a lawyer means facing tension between wanting to take in new work quickly and wanting to choose only work that is ethically permissible and reaps the greatest professional rewards. This was as true for solicitors in Victorian London as it is today. But, today’s lawyers confront more compliance requirements and fiercer competition than ever before and have information about their current and past practice spread throughout multiple offices, formats, and systems. Not surprisingly, many now seek ways to bring order to the chaos by taking a closer – or even first – look at how they manage new, on-going, and past matters. Enter Interwoven and its recently announced New Business Intake and Conflicts Manager tools. Probably best known in legal circles for its “matter-centric” document management and collaboration tools, Interwoven now complements its more recent Records Manager application with two products designed to help firms automate their processes and manage their matters’ lifecycle. The separately sold, stand-alone products both rest on each firm’s individual workflow processes. So, the first step to implementing these products is to visually map each step in the firm’s process for requesting and approving new work and investigating and managing potential conflicts. The process may be as simple or complex as the firm likes, and ideally would include all approvals and authorizations needed to advance to the next step. Once saved into the application, the workflow drives the user’s interaction with the New Business Intake and Conflicts Manager tools. Interwoven is not the only or even first vendor on the market with intake and conflicts management tools. But, three features make Interwoven’s offerings attractive. First, the design allows firms to change the underlying workflow any time, and see the change reflected in the new business and conflicts interface, seemingly without needing the vendor or other consultant and with minimal impact on the end-user. Second, the “wizard-driven” tools’ look and feel is designed to be easily and fully customized. Third, the design allows for multiple applications’ integration (none of which needs be an Interwoven product), meaning quicker results as data is searched where it lives rather than being exported. From the lawyer’s vantage point, the New Business Intake tool presents a trim uncluttered screen clearly listing all of the lawyer’s new matter requests and their stage in the process. Selecting the new matter (“wizard”) button starts the intake process; in the case of an established client information is pulled from the accounting system. Lawyers then complete fields and answer questions that dynamically appear based on responses given. For instance, describing a matter as a residential property purchase triggers requests for information germane to real estate and indicating that a matter is highly confidential solicits information needed to establish an ethical wall. In this way, users confront only portions of the intake relevant to their matter and role in the process. Responses are automatically saved when users move to the next field, a nice touch that protects against losing work if the system crashes or user forget to save before closing. Submitting the new business request triggers the next step in the workflow. Typically, for lawyers this will mean receiving an e-mailed link to a conflicts report. The link brings lawyers to another clean screen with three nice features. First, an overview at the top lists the search terms used, with each term hyperlinked to drill for more information from the source databases integrated with the application. Next, lawyers may select a Spot Report to remind them of the information provided with the intake request. Third, lawyers see the hits per search term, which also can be drilled into for greater detail. After reviewing reports, lawyers may send matters to the next stage (for example, to a conflicts committee or practice section leader), using a nifty little feature to flag problem hits. If the lawyer instead rejects the matter, the intake information is stored in the database. When a lawyer (or other final “gatekeeper”) instead approves a matter, a code triggers the next step in the file-opening process and sends information to other relevant integrated applications, such as accounting, a contact relationship manager, and document management and records systems. So, a firm that has integrated all of these systems could find its intake and new file opening procedures significantly streamlined and the potential for error greatly reduced by real-time searching and eliminating redundant manual data entry. The conflicts search functionality has a lot going for it too. Conflicts clerks can easily review all outstanding requests and search one matter while others are running in the background. Conflicts clerks are notified when searches are complete and when new searches are requested. What is more, users set for themselves when they want to be notified (for instance, immediately or at specific times of day) of different kinds of events. Conflicts searchers may add terms, set up relationships, add information from outside sources (like a party list from another firm), and go on-line for outside information. Again, links can be used to drill for more information on any hits and clean the “noise” from reports before sending them to requesting lawyers or a conflicts committee. In addition to searching the US Treasury Department Office of Foreign Assets Control Specially Designated Nationals list, the tool also automatically searches the New Business Intake database for any last-minute potential conflicts. At first blush, these products may be more likely to attract larger firms with more clients and potential conflicts to keep track of and bigger technology budgets. However, though Interwoven had yet to finalize pricing, it anticipated special pricing options for smaller firms. Some may also be wary of Interwoven’s Q1 2006 release date, shying away from being the first on the block to buy. (Others may be comforted by word of seven installations in the US and Canada of the base-product). But, for some the biggest drawback may be that they just have not yet done the groundwork to draw full value from these tools. The products clearly work best in environments where intake and conflicts policies and procedures have been thought through and fine-tuned. For those who have invested in laying the foundation, though, taking a good look at these two products may be well worth the time. * Ginevra M. Saylor, BA, JD, LLB (Equiv), is the Director of Knowledge
Management at McMillan Binch Mendelsohn
LLP. An Effective Client Service ProgramLori Brazier* Has your firm been asked to comment on how it proactively manages client service? Do you ask how you can distinguish your firm from others when making a pitch for work from a new prospect – or to get more or different work from an existing client? The question really is: how does the firm compete on service? Many large users of legal services (insurers, banks and other financial institutions, government, corporations) are seeking to work with a limited number of law firms and develop deeper relationships with them. Some will move work if the price is right, they have access to effective legal counsel, and they are comfortable with service. Service needs to be managed, even with a client who has enjoyed a long-standing relationship with the firm. Most firms know this. Few can articulate how they go about managing service. Managing service means paying attention to the key elements of service: accessibility, turnaround (timeliness) and ease of doing business. A mechanism to address service issues when they arise must also be in place. Several years ago, our firm developed a seven-point service guarantee for law firms that we continue to recommend across this country. The elements are: 1. Clear expectations. Tell every client how the firm will ensure timeliness and make it easy for the client to do business with the firm. These elements should be incorporated and every proposal for legal services and every engagement letter. 2. Accessibility. Identify legal teams and backups for every client, with the capacity to be reached 24/7. Return phone calls in four hours or fewer. Paralegal and secretarial staff should serve as secondary back-ups; they are often easier to reach. 3. Timeliness. Manage expectations: set a deadline for delivery of services or establish timelines to accomplish key milestones in longer matters (like deals and litigation). Create case plans for all matters requiring ten or more hours of legal work. Meet the schedule for communications, deliver documents on time, and be on time for every meeting. 4. Convenience. Hold meetings at the client’s premises, unless otherwise arranged. This is about ease of doing business. Visiting the law firm is often an inconvenience for clients. 5. Paperless. Reduce paper; use e-mail for correspondence and document transmission, including bills. Provide clients with online access to documents and status reports. Again, this is about ease of doing business. 6. Price. Ensure there are no surprises on price. Always estimate what the client should expect to pay. Tell the client if circumstances change the estimate and revise the estimate. Move away from talking about hourly rates and towards fees and ±10% ranges for each phase of the work. 7. Satisfaction. If the client is not satisfied with these elements of service, which is different from the results of the case or file, then perhaps the firm should reimburse twice the fee paid by the client. This, however, would be contingent on a formal discussion between the client and the firm’s managing partner. Law firms shy away from giving a money-back guarantee (more common elsewhere in the service industry). But, why not give the guarantee – as long as the firm has systems in place to manage service? * Lori Brazier is a partner with Catalyst Consulting. The firm has been
providing advice to law firms and law departments since 1994 and is designated
as the Preferred Supplier for Legal Services Consulting by the Canadian
Corporate Counsel Association. Lori can be contacted at (416) 367-4447
or through the website at http://www.catalystlegal.com. LPM Section to Host Live Program on Challenges for Law Firm LeadersThe OBA’s Law Practice Management Section will host an evening of networking and learning Thursday, June 22, 2006, entitled “Challenges for Law Firm Leaders.” The evening will feature keynote speaker Andrew John Kent, the new CEO of Toronto business law firm, McMillan Binch Mendelsohn LLP. Mr. Kent assumed the role of CEO less than a year after the firm’s merger of the over one hundred year old McMillan Binch in Toronto and Montréal mainstay Mendelsohns. In addition to discussing why lawyers decide to take on the challenges of being a Managing Partner, Mr. Kent will also explore the definition of success for firm leaders and how they can make a difference. Lori Brazier, partner with Catalyst Consulting and LPM Section Chair, round out the program with her observations. The event will be held at the Albany Club at 91 King Street in Toronto. The
evening begins at 5:30 p.m. with registration, hors d’oeuvres, and a cash bar,
with the program beginning at 6:00 p.m. The cost is $32.10 for OBA members,
$53.50 for non-members, and $21.40 for OBA Law School/Articling Student
Members. Click
here to register. Section Executive 2005-2006Chair: Lori Brazier, LL. B., MBA Secretary (Sections): Robert A. Muir Newsletter Editor: Ginevra Saylor Technology Liaison: Richard B. Potter,
Q.C. Member-At-Large: David Chaiton Member-At-Large: David B. Debenham Member-At-Large: Charles E. Humphrey Member-At-Large: John M. Sotos Staff Liaison: Janet Green Publications
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