Shifting paradigms

Phil Muller, director of legal services at Williams Lea, says that the Covid-19 pandemic is breaking down resistance to change and forcing faster action towards becoming more agile, reducing operational costs and staying competitive.

The year 2019 was one of the strongest years in fee income growth for law firms and many had their most profitable years in recent history. In spite of this, political uncertainty (remember Brexit?), concerns over an economic downturn, rising operational costs, increasing pressure from client demands, and the growing number of millennials and generation Z in the workforce, were already driving firms to look at improving the way they worked. However, progress was hampered by a culture that was firmly entrenched in traditional ways of working.

Resistance to change from partners, data and cybersecurity concerns, and loyalty to long-tenured staff, drove a resistance to virtual support models and more agile ways of working, while slowing down the pace of forward change. The Covid-19 crisis has challenged the status quo, rendered the concerns unfounded, and forced the legal sector to react immediately and drastically to its impact.

Easing the tension between traditional and new ways of working
Meeting the challenge of social distancing and office closures has paved the way for the legal sector to upskill in areas that have been lagging for the past few years, particularly with skills related to information security, agile working, digital platforms, and efficient resource management.

• Dispelling information security fears – Before the pandemic, concerns regarding security, confidentiality and data breaches underpinned a reliance on traditional ways of working. Now necessity has become the mother of invention, and many of the restrictions placed on lawyers, staff, suppliers, and third parties, who touch sensitive firm information, have been relaxed. It remains to be seen if a post-pandemic workplace prioritises onsite working, but firms that will successfully maintain information security will do so with robust process management and strong workflow tools that provide a clear audit trail and chain of custody information]
• The rise of agile working – As the crisis hit, law firms quickly had to ensure that their lawyers and support staff were able to work from home: not standard practice, as it weighs on an industry culture built on relationships and face-to-face interactions. Now, a couple of months in, there’s growing trust that many legal activities can be performed remotely. From matter management and deal closing to virtual collaboration with secretarial and administrative support staff; those resistant to agile-working practices were forced into new ways of working, and to their surprise are quickly adapting to it
• Moving towards a ‘digital first’ mindset – Traditional law firm models are heavily paper-based. As physical offices were forced to close, firms needed ways to share documents without offices, printers and mailrooms. They had to quickly find digital mail and matter-ingestion solutions to support a remote workforce. Again, any concerns over data security and quickly implementing new processes were overcome by necessity. Given that digital mail rooms can be set up in a short space of time (sometimes within a matter of days), it would be difficult to justify completely reverting back to the old model.
• Doing more with less through structured process – The crisis has driven a swift reaction to manage cash and protect the financial health of the firm. Many firms reacted with salary reductions, furloughs and even layoffs. Although rightsizing and scaling back may be a necessity, firms that already outsourced support functions were much more nimble in expanding and contracting support levels in response to the crisis. Additionally, law firms that outsourced key service lines had a partner to help them respond optimally to the economic challenge, so less emotion and management time was required to respond. A global partner that already has the right processes and software firmly in place can deploy staff around the globe efficiently so that no team is bearing too much or too little demand.

Reimagining the law firm office
Real estate needs will evolve as firms align office space requirements to the reality of a more dispersed and mobile workforce. We will most likely see a movement towards real estate space allocated for fee earners and their clients in prime locations, and other front office and support staff allocated to captives or third parties away from high-cost locations.

Driving success with agility and flexibility
Once the dust settles on a post-Covid-19 world we will know which new ways of working will endure and which processes will revert to traditional models. However, every law firm I have spoken to has said they don’t want to go back to the old ways of working. The commercial pressures that have been building for law firms will be exacerbated by the economic fallout from this crisis. With predicted significant revenue decline, the shift to agile-working models to reduce costs will become just as urgent. What we’ve learned is that, when forced, we can break down cultural barriers and traditions to make our businesses more efficient, agile and resilient than ever before, and that there is expertise in the market to help you.