From high levels of lock up, to lack of technology innovation, the pandemic has pulled apart some existing fissures in the business models of law firms. Where this has happened, law firms need to use it as an opportunity to reform, ensuring they are better-prepared, either for the next crisis when it comes, or for increased competitive pressure.
Change comes from the top. No programme can succeed without the commitment and dedication of senior management. Where leaders are forward-looking and embrace new thinking, it trickles down through the firm. We believe all leaders should be asking themselves what can be done differently. Law firm leaders need to set clear KPIs, monitor them closely and push on implementation.
Once the direction of travel is established, leaders need to keep refocusing the team on the change they need, rather than simply hoping it will happen organically. This can help push through the change curve.
From our observation of law firms, we have found that OKRs (Objectives and Key Responsibilities) are a great tool. The concept came from Silicon Valley, which – like the legal profession - is focused on high performing people-based businesses. The OKR methodology is great at accelerating change within organisations.
Equally, embracing business intelligence tools such as Katchr and Microsoft’s PowerBI can be helpful for business leaders and teams going through a change process. These systems take information from underlying systems and show them in a live dashboard. This can give a clear idea of performance against KPIs and enable enhanced management.
Turning strategy into action is often harder than it sounds. Firms are often great at articulating strategy, but sustaining momentum and focus is difficult. It is always worth sub-dividing objectives into bite sized actions and pushing responsibility for those onto individual operational teams, tracking and reworking when things change.
Finding shortcuts will help. It can be hard and slow for law firms to move into new specialisms, geographies or centres of excellence. Our experience suggests bringing in whole specialist teams can help accelerate change, while also refreshing the culture, and bringing a new jolt of activity with them. Leaders can learn a lot about how other firms operate, which can help build best practice.
Ensuring that successful change is properly incentivised can also be a powerful catalyst. Firms are often risk averse; properly incentivising partners to encourage taking certain risks can make them push harder for change.
Successful change requires certain behaviours to become embedded. Leaders need to ensure they become part of everyday use, refocusing their teams on the tasks in hand.
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.