The Blog
Holiday Reading
Posted: 26 July 2013
There is such a deluge of research in the market currently that it?s hard to know where to start. If like me you have a ?worry tray? that accumulates the stuff you really do need to read some day soon, here?s a guide to what to take to the beach with you; and yes, you really can bin pretty much all of the rest.
Hidden among the mass of research recently there are some real gems, and I?ll come to those in a minute, but you have to hack through the undergrowth to find them - so here?s how to recognise the stuff to ignore first.
The race to become "The-Legal-Services-Industry?s-Drucker" is probably the worst of the sharp elbow scraps currently. To paraphrase the great man, chasing that aim ever more efficiently is the ultimate waste of time; but the queue for the podium is long and winding. The point about Drucker?s genius was that he really didn?t need translating. If you haven?t already read his accessible tomes, shame on you, but go to the source.
Some wilful and borderline mendacious statistical games are also being played out in the name of research to back regulatory or industry rivalries. The current administration gives it short shrift; but these are long games being played out. It is worth remembering the candour of Lord McNally when he simply pointed out that "access to justice is not the same as access to a lawyer". Ouch.
The risk behind the sheer volume of research piling up, however, is that it will give the impression of understanding, control even. For less cooled heads it can inspire over-reaction bordering on panic. To be clear, for law firms in particular doing nothing is not an option, but that does not mean the end really is nigh. Recession may have added a sense of urgency, but the forces at play have been so for a long time. The number was up for High Street private/consumer law generalists many decades ago frankly; the Legal Aid morass has been in intensive care for at least as long too; and the traditional protectionisms of qualifications and reservations have simply not been effective for decades. Wait long enough and even insurers, technologists, consultants and outsourcers will start to get more right than wrong eventually.
So who?s talking sense? A top 3 - none of which will take long:
1. The best reading on the beach under that thatched umbrella is something many will have read already - but really Do It Again. A deftly readable and accurate summary of issues for BigLaw comes from Adam Smith Esq, entitled Growth is Dead: Now What? The loudest point he makes is not explicit: refreshingly there is not one word of special pleading or higher cause promotion from him. Here law is just another business. That fact, plus the fact that no-one wants to address the issue that BigLaw really doesn?t even see itself as the same profession as Small Law is implicit here. This is only urgent now because the Big boys have been bitten too.
He points out that Big Law has been slow to deal with buyer power in economic terms and for some it may be too late. Fundamental. It?s not recession related, though that added the spice of panic to it. It?s not liberalisation or even competition related, but they are getting better. It?s simple hard economics. When the tide of regulation was rising inexorably, demand for lawyers was strong, so strong that firms began to take lawyers in-house. While it was assumed these guys would stay in the fold, they actually went native some time ago - well before 2007. Spanish practices among some big firms were a push too, no doubt, but this professionalisation of the purchasing was inevitable.
It?s also not the end of the world. Read it again, its brevity is refreshing. You can get it on Kindle right now for £6.89: cheaper than the price of that umbrella?d drink probably.
2. Two other pieces of research tie in quite tightly, and they both come from the more traditional hallowed portals of academe. Lawyers will take the Said Business School more seriously than most, for reasons that will become clear later, so let?s start there, and Mari Sako puts meat on the bones of what Mr Smith Esq signposts above.
Strategic forces codified in management science way back in the 1980s apply as much to professional service firms as any another enterprise and the primacy of buyer power (for now) is the focus of much of her attention.
The algorithms, regression analyses, etc can be intimidating, but some constructs around the insourcing, outsourcing and "co-specialising" are genuine innovations in taxonomy in this field.
The main point again is that "it?s the economics, stoopid". So don?t panic, don?t think that protectionism or some sense of entitlement are any damned use, just get different and get better - from the clients? perspective (not the lock step or EWYK one).
Mari Sako?s slides are free on the Said website and well worth a look. It will slot into iBooks right beside the Kindle Growth book.
3. Saving the best ?til last, however, a fantastic summary of behavioural economics came through as an LSB research piece and Professor John Maule?s summary of the key concepts is essential reading for all involved in legal services. It’s free on the LSB site.
Perhaps it takes a combination of an ex-lawyer like Adam Smith and Leeds? finest academics to explain why lawyers are struggling with the basics here, but it rings true.
What makes lawyers great is their scepticism, their intellectual rigour, their ability to think theoretically and in depth; their tolerance of standing apart from the crowd is important too, just as is their willingness to dig their heels in when it matters.
What makes lawyers rubbish is that for a businessman to want to go to an aloof, egg-headed, difficult, loner, whose always bloody right - well that fan really has to be in a parlous state, and then some.
When lawyers turn up with a lifestyle of millionaires and the sense of entitlement to boot, one or two old school businessmen will think "great, I want a piece of that", but most simply think "they?re paid waay too much".
Behavioural Economics can give you insights into why this is happening.
Whether you believe that or not, the Maule piece introduces some basics. System 1 thinking (intuitive, emotional, instinctive, quick jumps) trumping System 2 thinking (rational, process focused, contemplative, in-depth) will be dismissed by most lawyers as nonsense.
But resistance is futile. It rings very true to how clients and potential clients really make decisions, especially in the SME sectors in legal services. (And can lawyers please stop using the word consumer to mean ?not-a-lawyer? - it?s meaningless in economics terms and condescending at best).
Another established (but almost certainly new to lawyers) concept like "satisficing" is also key. Busy people who see legal stuff as a cost of failure/distraction, usually take the first credible solution that comes along to remove it. They probably don?t even categorise the issue as legal, and they certainly don?t rush to a copy of the Legal 500 to see who?s what. (Other LSB research labours this point too.)
The point is, lawyers, and especially lawyers in private practice, don?t get to make the call on whether an issue is one that lawyers should be involved in.
I?ve tried summarising this in the past as ?you don?t call the fire brigade to help you cook dinner? but the ?cliff fences - not ambulances? quip makes the same point.
There is much, much more in Maule?s piece, and I do hope someone gets them to look at the impact of behavioural economics on commercial work, not just the broad brush consumer work that seems to attract all the government money.
Most lawyers will have to take several runs at this piece. My guess is many lawyers will dismiss it:
(a) because nothing useful intellectually ever came out of somewhere like Leeds, for Goodness sake;
(b) the last thing we need with firms going bust is some more smart-arsed theories from a bunch of economists anyway; and
(c) dismissing rational intellectual rigour so freely is arrant nonsense; nonsense on stilts....
They?d be wrong. There is much to learn for each of these three; accessible and insightful all.
Now where?s that ice bucket gone...
Hidden among the mass of research recently there are some real gems, and I?ll come to those in a minute, but you have to hack through the undergrowth to find them - so here?s how to recognise the stuff to ignore first.
The race to become "The-Legal-Services-Industry?s-Drucker" is probably the worst of the sharp elbow scraps currently. To paraphrase the great man, chasing that aim ever more efficiently is the ultimate waste of time; but the queue for the podium is long and winding. The point about Drucker?s genius was that he really didn?t need translating. If you haven?t already read his accessible tomes, shame on you, but go to the source.
Some wilful and borderline mendacious statistical games are also being played out in the name of research to back regulatory or industry rivalries. The current administration gives it short shrift; but these are long games being played out. It is worth remembering the candour of Lord McNally when he simply pointed out that "access to justice is not the same as access to a lawyer". Ouch.
The risk behind the sheer volume of research piling up, however, is that it will give the impression of understanding, control even. For less cooled heads it can inspire over-reaction bordering on panic. To be clear, for law firms in particular doing nothing is not an option, but that does not mean the end really is nigh. Recession may have added a sense of urgency, but the forces at play have been so for a long time. The number was up for High Street private/consumer law generalists many decades ago frankly; the Legal Aid morass has been in intensive care for at least as long too; and the traditional protectionisms of qualifications and reservations have simply not been effective for decades. Wait long enough and even insurers, technologists, consultants and outsourcers will start to get more right than wrong eventually.
So who?s talking sense? A top 3 - none of which will take long:
1. The best reading on the beach under that thatched umbrella is something many will have read already - but really Do It Again. A deftly readable and accurate summary of issues for BigLaw comes from Adam Smith Esq, entitled Growth is Dead: Now What? The loudest point he makes is not explicit: refreshingly there is not one word of special pleading or higher cause promotion from him. Here law is just another business. That fact, plus the fact that no-one wants to address the issue that BigLaw really doesn?t even see itself as the same profession as Small Law is implicit here. This is only urgent now because the Big boys have been bitten too.
He points out that Big Law has been slow to deal with buyer power in economic terms and for some it may be too late. Fundamental. It?s not recession related, though that added the spice of panic to it. It?s not liberalisation or even competition related, but they are getting better. It?s simple hard economics. When the tide of regulation was rising inexorably, demand for lawyers was strong, so strong that firms began to take lawyers in-house. While it was assumed these guys would stay in the fold, they actually went native some time ago - well before 2007. Spanish practices among some big firms were a push too, no doubt, but this professionalisation of the purchasing was inevitable.
It?s also not the end of the world. Read it again, its brevity is refreshing. You can get it on Kindle right now for £6.89: cheaper than the price of that umbrella?d drink probably.
2. Two other pieces of research tie in quite tightly, and they both come from the more traditional hallowed portals of academe. Lawyers will take the Said Business School more seriously than most, for reasons that will become clear later, so let?s start there, and Mari Sako puts meat on the bones of what Mr Smith Esq signposts above.
Strategic forces codified in management science way back in the 1980s apply as much to professional service firms as any another enterprise and the primacy of buyer power (for now) is the focus of much of her attention.
The algorithms, regression analyses, etc can be intimidating, but some constructs around the insourcing, outsourcing and "co-specialising" are genuine innovations in taxonomy in this field.
The main point again is that "it?s the economics, stoopid". So don?t panic, don?t think that protectionism or some sense of entitlement are any damned use, just get different and get better - from the clients? perspective (not the lock step or EWYK one).
Mari Sako?s slides are free on the Said website and well worth a look. It will slot into iBooks right beside the Kindle Growth book.
3. Saving the best ?til last, however, a fantastic summary of behavioural economics came through as an LSB research piece and Professor John Maule?s summary of the key concepts is essential reading for all involved in legal services. It’s free on the LSB site.
Perhaps it takes a combination of an ex-lawyer like Adam Smith and Leeds? finest academics to explain why lawyers are struggling with the basics here, but it rings true.
What makes lawyers great is their scepticism, their intellectual rigour, their ability to think theoretically and in depth; their tolerance of standing apart from the crowd is important too, just as is their willingness to dig their heels in when it matters.
What makes lawyers rubbish is that for a businessman to want to go to an aloof, egg-headed, difficult, loner, whose always bloody right - well that fan really has to be in a parlous state, and then some.
When lawyers turn up with a lifestyle of millionaires and the sense of entitlement to boot, one or two old school businessmen will think "great, I want a piece of that", but most simply think "they?re paid waay too much".
Behavioural Economics can give you insights into why this is happening.
Whether you believe that or not, the Maule piece introduces some basics. System 1 thinking (intuitive, emotional, instinctive, quick jumps) trumping System 2 thinking (rational, process focused, contemplative, in-depth) will be dismissed by most lawyers as nonsense.
But resistance is futile. It rings very true to how clients and potential clients really make decisions, especially in the SME sectors in legal services. (And can lawyers please stop using the word consumer to mean ?not-a-lawyer? - it?s meaningless in economics terms and condescending at best).
Another established (but almost certainly new to lawyers) concept like "satisficing" is also key. Busy people who see legal stuff as a cost of failure/distraction, usually take the first credible solution that comes along to remove it. They probably don?t even categorise the issue as legal, and they certainly don?t rush to a copy of the Legal 500 to see who?s what. (Other LSB research labours this point too.)
The point is, lawyers, and especially lawyers in private practice, don?t get to make the call on whether an issue is one that lawyers should be involved in.
I?ve tried summarising this in the past as ?you don?t call the fire brigade to help you cook dinner? but the ?cliff fences - not ambulances? quip makes the same point.
There is much, much more in Maule?s piece, and I do hope someone gets them to look at the impact of behavioural economics on commercial work, not just the broad brush consumer work that seems to attract all the government money.
Most lawyers will have to take several runs at this piece. My guess is many lawyers will dismiss it:
(a) because nothing useful intellectually ever came out of somewhere like Leeds, for Goodness sake;
(b) the last thing we need with firms going bust is some more smart-arsed theories from a bunch of economists anyway; and
(c) dismissing rational intellectual rigour so freely is arrant nonsense; nonsense on stilts....
They?d be wrong. There is much to learn for each of these three; accessible and insightful all.
Now where?s that ice bucket gone...
Legal Services Statistical Review 2013
A Review of the Key Statistics Behind the Legal Services Market in the UK.
Based on a range of statistical sources, including a long term look at the statistics for the professions and the economy in which they operate, this ground breaking review takes a hard economic perspective on the drivers to the legal services markets.
In 18 slides, the fundamental drivers of the professions and the challenges they face are mapped and charted in detail.
Several surprising conclusions also emerge - consolidation and automation are important, but they are not the most important issues facing the legal profession.
Arguably consolidation is a myth. The training pipeline is not fit for purpose.
The profession is in rude health, but it is still able to miss out. Rumours of its demise are considerably overstated.
To cut through the hype and hyperbole which is all too common currently due to the Legal Service Act - stick to the facts; they?re here.
Price: £95 |
File Type: PDF |
File size: 1,919.20 Kb