Law Firm of the Future
As the legal profession adjusts to shifts in the market, legal technology advances and the unbundling of legal services, lawyers can take solace that they’re still in high demand.
And even though some BigLaw stalwarts—Cravath, Swaine & Moore, Debevoise & Plimpton, and Cleary Gottlieb Steen & Hamilton—are so far successfully navigating uncertain waters by sticking to traditional law firm models, the New York Times notes there may be a “more sweeping transformation” on the horizon.
In that transformation, firms may look more and more like Mark Harris’ Axiom Law, the paper’s Dealbook blog notes.
Harris, a Davis Polk & Wardwell veteran, “is trying to rewrite the law firm business model” with his 900-lawyer firm, which is devoid of partners and aims to offer BigLaw service at cut-throat prices. (Also see: “Legal Rebels: Mark Harris’ ‘Managed Services’ Make Multimillions”)
Harris isn’t saying firms like Cravath will go away, especially for clients who need particularly complex work. But for huge document review projects, firms like Axiom will be more in demand, he predicts.
The Dealbook piece also explored partner compensation, identifying a sea change in how PPP became the metric for measuring law firm success. “When American Lawyer magazine began publishing a ranking based on profit per partner in the early 1980s, it revolutionized the industry, but it also arguably led to a dangerous race among firms that left clients as a secondary priority,” Dealbook opines.
Harris put it this way, noting that about 30 years ago, “the interests of law firms went from serving the clients to serving themselves.”
Now, with changes in the marketplace afoot, there are only a few ways for firms to remain profitable under traditional profit per partner models: Increase prices, work more hours, add to the client base, and/or reduce overhead.
It’s not a new issue, but Dealbook notes, “None of those options appear to be in the client’s interest at all.”