Posted by: johnocunningham | January 18, 2017

Best of December’s Blog Posts:

This is my 49th post in a series of monthly features that I have dubbed “Best of My Blog Roll.” The concept is simple – at the end of a month I peruse my own blog roll (see that column on the right) for material created by other bloggers that I think is most worthy of sharing with others, and then I report on it here.

Reviewing blog posts for the month of December 2016, I have chosen to highlight the following three blog posts:

  1. A great piece of advice from the Cordell Parvin blog on the subject of integrating your hobbies and passions with your client development habits. This post has plenty of links to other useful, related topics too.
  2. A short, tidy post by Vanessa Schaefer of Clockwork Design Group, offering three tips for better personal branding, which lawyers should consider because their personal brand or reputation is what clients say they hire – more so than the brand of the firm.
  3. A good story-telling post on the Law Firm 4.0 Blog by Deb McMurray, which not only describes what lawyers can learn from a sports-casting legend, but offers links to similar posts on what lawyers can learn from other people and experiences.

If you have recommendations for great blogs or blog posts, don’t hesitate to share them.

Posted by: johnocunningham | January 9, 2017

Most Popular 2016 Blog Posts on Legal Service Industry

One of the nice features of a WordPress blog is the analytics that come with it, enabling you to look at the most popular posts on a site by day, week, month or year.

With regard to my own site, the analytics show that the following blog posts of 2016 were most often viewed and disseminated to others:

  1. A post on “Internet Tools for Writers, Bloggers and Content Creators
  2. A post on “Law Firms Using Data Analytics to Enhance Client Development” and
  3. A post on “What’s New in Law Firm Innovation

WordPress also summarizes the entire multi-year history of a site, and reveals that the most popular blog post on my own site during the past ten years is this one from 2012:

Posted by: johnocunningham | December 27, 2016

2017: A Look Ahead for Law Firms

The year 2017 does not look promising for law firms, according to a recent overview of a business survey report that appeared on Bloomberg Law on Dec. 13, 2016.

Among other things, the cited report noted that:

  • Realization rates (percent of billables that are collectible) declined through 3Q (3rd quarter) of 2016;
  • Demand for law firm services grew by just 0.3 percent through 3Q;
  • Billing rate increases account for most law firm revenue gains, which is not sustainable.

The report cited “the usual suspects” as solutions for these trends, including better expense management and brand differentiation in marketing.

But, as explained in multiple prior postings on this blog, those solutions will not be sufficient to preserve and promote the lasting vitality of any firm. During the intense phase of competition that the legal industry has entered in this millennium, law firms will need more comprehensive and well-devised strategies for competing with or partnering with:

  •  Corporate law departments, which have been cutting into work previously allocated to firms, as the corporate law departments grow in response to 1st year salary bumps and steady overall billing increases that outpace inflation;
  • Technology solutions providers, which are reducing human billable time spent on document review and discovery, and which will proliferate further with the advent of artificial intelligence that can research and analyze terabytes of data much faster and more effectively than humans;
  • Alternative legal service providers, such as accounting firms and consulting firms that often have far better relationships with most of the C-suite officers of large companies, relationships which are being well-leveraged to grab portions of legal work related to such things as quantification of economic damages in complex litigation; and
  • Temporary staffing solutions providers, designed to supply corporate law departments or law firms with lower cost, but experienced lawyers and paralegals when bump-ups in work volume arise.

Firms will need to do all of the following to stay on the leading edge of competition in this era:

  • Shop for, assess, learn and implement the best technologies for saving money and time on legal services;
  • Institute perpetual process improvement practices in order to maximize efficiency, cut costs, and raise quality and consistency of results;
  • Institute project management practices in order to execute large project management functions as well as or better than their in-house and consulting firm competition;
  • Develop, test and implement innovative solutions to recurring client legal problems;
  • Develop cultures that will foster a unified focus on perpetual improvement, better training and obsession with client service.


Posted by: johnocunningham | December 22, 2016

One Law Firm’s Effort To Drive Innovation Rather Than React To It

The big corporate clients that every law firm covets have run laboratories and so-called skunk works groups for a long time in an effort to breed game-changing innovations, and now at least one big law firm in America is following suit.

Reed Smith announced earlier this year that it was launching two innovation “hubs” — one in London and another in New York City — where its lawyers can convene, share ideas and execute on innovation in three areas:

  1. new areas of the law,
  2. new ways of delivering client services and
  3. streamlining internal processes to become more efficient.

The firm is also hiring Alex Smith, a London “innovation manager” from LexisNexis, who will lead and facilitate the firm’s innovation projects. One of his first projects will be to develop an app that the firm initially declined to publicize, but which is tentatively set to be rolled out in 2017.

If law firms are to survive in future competition with outsourcers, technology alternatives, and even fast-growing corporate in-house departments, they will have to innovate with efficiency and speed. Reed Smith’s big move could put them out in front if the firm embraces the products of its own “laboratory.” I hope that they do because history is littered with corporations that lost billions by blowing off their own innovations. Kodak sold patents on digital photography because it might kill their film sales, Xerox sold much of the early technology developed for PCs because it did not fit their core business, and IBM dismissed plans to build an outsourcing solution for the data processing needs of banks, health care institutions and other data dependent companies, resulting in the creation of  a multi-billion dollar competitor, Electronic Data Systems.

It will be very interesting to see what Reed Smith’s innovation hubs can deliver and to see if the partners embrace the changes. Kudos to them for being bold enough to make the effort !

Posted by: johnocunningham | December 9, 2016

Best of November Blogs: Biz Dev, Marketing, Branding and Client Surveys

This is my 48th post in a series of monthly features that I have dubbed “Best of My Blog Roll.” The concept is simple – at the end of a month I peruse my own blog roll (see that column on the right) for material created by other bloggers that I think is most worthy of sharing with others, and then I report on it here.

Reviewing blog posts for the month of November 2016, I have chosen to highlight the following:

  1. A post on practical tips for “quickie” marketing and business development ideas from the Cordell Parvin blog, entitled “Fifteen Thoughtful Things You Can Do For Clients When You Are Busy.”
  2. A thought-provoking post on the LawVision blog by Bruce Alltop, who notes a trend in outsourcing of marketing functions and activities at law firms. His post is captioned, “Law Firm Business Development: Is Marketing Department Outsourcing the New Black?”
  3. A post on the marketing effect of optics and design by Vanessa Schaefer of Clockwork Design Group, entitled, “Branding Your Office Space.”
  4. A data-rich post by Casey Flaherty on the Three Geeks and a Law blog, entitled, “Clients Confirm: We Don’t Ask Law Firms to Change.” This post explains that clients don’t ask for change as much as they just vote with their feet and leave when things are not right.
  5. A nice post by Stephen Fairley on the Rainmaker Blog, in which he offers practical suggestions for client survey questions in his piece entitled, “How Your Clients Can Guide You to Building a Better Law Firm.”
Posted by: johnocunningham | November 28, 2016

Corporate Client Communications Tips for Law Firm Litigators

I recently noticed an article by Mark Herrmann on the “Above the Law” website, entitled, “Five Ways Reporting Differs at Law Firms and Corporations,” and thought it did a nice job of illustrating some important points about communication with a corporate client.

The article was written from the point of view of one who has served in-house for a corporate legal department (something I did for nearly ten years) and demonstrates that there are multiple key constituents who need to be informed about critical and financially material events in the course of any legal matter, particularly a significant piece of litigation.

As the article illustrates, many companies have requirements for key level officers to authorize settlements that exceed a particular sum, and all public companies (and some private ones) have key financial officers who must keep track of, be alerted to and disclose to shareholders or stakeholders any prospective or concluded settlement involving a material sum of money.

Some other communications tips not mentioned in the article would include the following:

  1. Inform the appropriate corporate contacts when a matter is going over budget, or is expected to go over budget for legal expenses, regardless of a favorable settlement prospect or outcome because companies are constantly jiggering their forecasts of revenue and expenses to give accurate disclosure to stakeholders, and they need to track all expenses as closely to real time as possible.
  2. Tell your key corporate contact or contacts about what you have learned from a matter after settlement, letting them know of any exposures that might exist due to policies, practices, procedures or potentially deficient or inadequately trained management or staff personnel so they can correct problems. This kind of added value is something that shows your interest in being a partner and trusted advisor, as well as a service provider.
  3. Tell your key contacts about any good news you have learned in the course of representation. If the local manager and key witness was a star, tell them. If the records department of the company was incredibly responsive and well-organized, say so. People need to know what is working as well as what is not working, and plaudits are always well-received, and can open doors to new friendships with other personnel at an existing corporate client.


Posted by: johnocunningham | November 22, 2016

Bad Actors, Culture and Winning

I recently noticed numerous references on social media to an October 28 FORBES magazine article by David Parnell, entitled: “Law Firms Surveyed – Bad Actors Present Challenges for Leadership.”

Apparently, this piece about toxic law firm environments created by unregulated bad behaviors, struck quite a chord with those in the law.

It did a nice job of summarizing the bad behaviors most often cited as troublesome by workplace colleagues, the challenges of dealing with these bad behaviors, the current processes for dealing with it, and the potential additional solutions.

What I found most interesting about this article, and my comments thereon are as follows:

  1. While 87 percent of firms have written value statements, only 20 percent have specified sanctions for behavior not aligned with values. Comment: Lawyers deal with and craft codes of conduct for clients all the time, and many even draft legislation that specifies penalties for non-compliance. This should be an easy fix that will pay dividends and make it easier for managing partners and executive committees to regulate bad behavior.
  2. Although most firms have no specified sanctions for violating firm values, more than half of firms have dismissed partners in the last five years for behavior inconsistent with firm values. Comment: With regard to this circumstance, you would think that firms would want to move quickly to put written policies and sanctions in place, if only to defend the firm against lawsuits by bully victims and fired bullies alike.
  3. Bullying and lack of respect clearly came in first place among the cited bad behaviors within law firms – nearly 90 percent of respondents cited this as the most common “bad behavior.” Comment: There is no excuse for lawyers acting this way, as our profession is supposed to protect others, set an example, and avoid even the appearance of impropriety. If bullying is reported this commonly, clearly something is not being done about it.  Why?
  4. Only 33 percent of firms reported that they have a formal complaint process for bad behavior. Comment: This is perhaps one reason why bullying continues to be common, which further damages the image and the reputation of a profession already under siege, as well as harming the firm in which the bullying takes place.
  5. An estimated 75 percent of detrimental actors among partners have compensation equal to or higher than the firm average. Comment: This is probably the biggest reason that bullying neither gets reported or dealt with on many occasions. The fear is that the bully might take their book of business out the door, but the reality is that the bully’s origination numbers are likely inflated because he fights over them like a wolf over raw meat, and there is no measure for how many originations he defeats or how many client defections and valued employee defections he causes. As the article points out, the bullies can also chase away potentially huge lateral contributors.

A number of highly successful managing partners that I have interviewed are of the belief that dealing promptly and effectively with bad actors is essential to workplace productivity and long-term stability, and one who was particularly successful cited bully control and elimination as “economic addition by subtraction.” I think this is right. A raft of materials has also been written about the importance of this issue in the world of corporate culture, and both academics and executives have concluded that workplace culture and behavior are critical components to long-term success.

As Lou Gerstner, former Chairman and CEO of IBM once wrote: “Until I came to IBM [as CEO] I probably would have told you that culture was just one among several important elements in any organization’s makeup and success — along with vision, strategy, marketing, financials, and the like… I came to see, in my time at IBM, that culture isn’t just one aspect of the game, it IS the game.”

Furthermore, as Parnell’s article points out,  Stanford professor Robert Sutton and other business gurus have made the case for adjusting hiring practices to align with cultural values, and this is where real bully control begins – at the front door. “The best firms spend an inordinate amount of time, sometimes even using psychometric testing, to ensure that a candidate is socially competent and if they obtain evidence to the contrary they don’t try to fix the problem, they just don’t hire the problem,” Sutton reportedly has said.

So, if you want a winning and collaborative culture, you have to deal with it at the point of hiring AND the point of firing. How well this gets articulated and communicated within your law firm may be the key to your success.

Posted by: johnocunningham | November 15, 2016

Trends Among Chief Legal Officers

Legal consulting firm Altman Weil has released its 2016 survey of Chief Legal Officers (“CLOs”), which reveals some interesting stats on which I would like to offer the following comments:

  1. Efficiency. More than 60 percent of in-house law departments are improving their efficiency by improving their internal procedures and technology tools. Comment: Law firms should also be engaged in process improvement and technology innovation if they want to keep pace with their corporate clients, which are fast becoming their competition as in-house departments grow.
  2. Outside Counsel Cost Control. The key statistics I see here are that 40 percent of CLOs are reducing the matters sent to outside counsel, and 36 percent have shifted significant work to lower priced firms. Comment: This suggests that there is indeed a price point beyond which the corporate legal consumer will not spend, and the client solution is to bring the matters in-house or shift them to lower cost firms.
  3. Legal Service Competition. More than 80 percent of CLOs will bring more work in-house this year, and 57 percent will outsource legal work to non-law firm vendors. Comment: Law firms have to be aware of the pricing offered for legal services by technology solutions and outsourcing providers. They also need to know the rough cost of adding lawyers, overhead and support to in-house departments because that is who they now compete with. If you can demonstrate that you are a higher quality and more cost-effective solution vs. in-house competitors and alternative providers, then you can win more market share.

The legal services landscape is rapidly changing, and the pace of change is only likely to accelerate in the years ahead. Now more than ever it is crucial to understand the marketplace and communicate value to current and potential clients.

This is my 47th post in a series of monthly features that I have dubbed “Best of My Blog Roll.” The concept is simple – at the end of a month I peruse my own blog roll (see that column on the right) for material created by other bloggers that I think is most worthy of sharing with others, and then I report on it here.

Reviewing blog posts for the month of October 2016, I have chosen to highlight the following:

  1. A timely and practical post on “Five Ingredients for a Successful Holiday Social Media Campaign” by Mandy Edwards of M.E. Marketing.
  2. A great post on the power of story-telling by rainmaking consultant Cordell Parvin.
  3. A thought-provoking post by Susan Duncan on her InFocus blog, entitled “Do Your Law Firm Leaders Lead or Manage?”
  4. An encouraging post for lawyers who must speak at conferences, posted by Nancy Myrland of Myrland Marketing, and entitled “Lawyers Stop Worrying About the Guy in the Third Row.”

Each of these posts offers something practical and/or thought-provoking. If you have recommendations for other good posts or great blogs, feel free to share them via the comments link on my site.

Posted by: johnocunningham | October 28, 2016

Managing Partner Nightmares From a Client’s Perspective

I came up with the idea for this blog post after I ran across a recent publication by Ward Bower from the reputable legal consulting firm, Altman Weil. The publication is entitled, “What Keeps Managing Partners Awake?”

The top 10 list of managing partner nightmares is an excellent summary of trending issues that law firm management groups must solve in order to keep their firms competitive, not just with other firms but with fast-growing legal service  contenders found among accounting and consulting firms, in-house legal departments, online and outsourced technology solutions, and contract staffing agencies.

In order to chart a successful course for the future, what law firm management groups will need to consider most carefully is the client’s view of these top 10 trending issues.

Based on my experiences interviewing executives, general counsel, and other in-house lawyers, here are some of the prototypical client perspectives on these issues:

  • With regard to the criteria for becoming partner, it should be about the service and the client satisfaction, and there should be some measurement of how well candidates for partner have served clients to their satisfaction and how well they have performed in retaining clients rather than causing their defection to other firms (these metrics would be supplemental to but very different from gross billable hours or claimed client originations).
  • With regard to law firm culture, the operative question-should be, “How do we create a culture of obsession with client satisfaction and constant improvement?”
  • With respect to eroding client loyalty, law firms must figure out how to inspire more lawyers to become “trusted partners and advisers” to their clients rather than just good service providers because trusted partners enjoy a different level of loyalty based on extraordinary mutual commitment.
  • With regard to price competition, law firms must stop thinking about hourly rates, and start thinking the way the client does – the client wants to know the gross cost per matter, which is often less when you procure the most experienced and highest priced lawyer by the hour. Firms that can train more lawyers to be “experts” and “trusted advisers” can charge higher hourly rates AND be lower cost providers.
  • With respect to new competitors and their growing share of the legal services pie, law firms must start to think about investing in more radical game-changing and disruptive innovations because that is what their competitors are doing, and those competitors are starting to steal legal talent and client matters from many firms.
  • With regard to marketing expense, law firms will need to do what their best clients have long done to survive – collect and analyze a lot of data about marketing activities, client perceptions and decision-making in order to invest marketing dollars where they will produce the best return on investment. Firms will also have to hire and trust marketing experts rather than putting someone in charge of marketing who will just take orders.
  • With respect to cyber-security, it is simply something clients assume you are handling well, and they will get very nervous or even flee the first time you have to tell them about a breach.
  • Finally, with regard to “partner denial of economic realities,” this is a problem that should provide a sine qua non factor in making partner or continuing to be a partner – the reality is that NO client would allow a management level person to last long in their position in a state of ignorance with respect to the marketplace.

Also, as I learned soon after arriving at my first in-house counsel job with an international retailer, the cold, harsh reality is that the client (or customer/buyer ) does not care whether you can solve your management problems. The buyer has lots of options in the marketplace, and they will simply vote with their feet, moving quickly and unexpectedly to the provider who has figured out how to serve them with the quickest, most effective and least costly answers to their needs.

Whether you adapt to change is optional, whether you survive is not.

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