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Legal Evolution:  Serving Clients by Doing More With Less

Insight June 24, 2011

Law firms need to take a lesson from their business-clients by utilizing technology to become more efficient and cut costs to clients.

During the economic downturn, the quest for efficiency has been a primary focus for many companies struggling to adjust to the new business climate.  Many companies are finding that Web 2.0 technologies are the best way of achieving this.  Searching for savings, businesses have been investing in virtualization and cloud-computing as ways to maintain competitiveness by decreasing operating expenses.  In addition to the immediate benefit of decreasing costs, the companies that are investing the most in these technologies during a sluggish economy will be the companies that are in the best position to grow rapidly as the business environment improves.  Bob Kelly, corporate vice president of infrastructure server marketing for Microsoft corporation, recently advocated greater virtualization and cloud-computing for businesses seeking an advantage when he said that “what we’re seeing is those companies who invest today and focus their investments on efficiency are setting themselves up for a faster return to growth.” 

While the business community is known for resilience and the ability to adapt to changing market conditions, the legal community is not.  Instead, many legal practitioners cling to the old ways of doing things long after the time for change has arrived.  This usually appears in the form of the traditional big-firm business-model; developed during the middle of the last century to address a supply shortage of sophisticated business lawyers.  Because of the high demand for their skills, big firms were able to pass the cost of training new associates on to their clients.  Legal commentators are noting the changes that the legal industry is undergoing.  The recession has forced many businesses to cut costs, and exorbitant legal fees have been one of their primary targets.  William Henderson has written an article discussing some of the reasons why legal service fees are so ripe for cutting (http://www.nationaljurist.com/content/critical-issues/why-job-market-changing).  The supply-crunch that justified the associate-training model no longer exists; the job market is flooded with talented lawyers.

            This is a time for the legal community to take a lesson from their business clients by adapting Web 2.0 technologies.  During this new economic landscape, the legal practitioners who use these technologies to become more efficient will be the ones who are best able to serve their clients at reduced costs.  A firm with disparately situated attorneys linked through cloud-computing and virtualization can much more easily apply its best talent wherever it is most needed.  Because physical distances become a non-issue, a firm can effectively draw from a much deeper pool of talent than a regional firm with a centralized office could ever hope to.

            As businesses are looking to reduce costs as a way to stay competitive in this economy, the law firms that provide services to those businesses need to adapt.  In addition to reducing reliance on young associates, law firms need to utilize existing technologies to more efficiently allocate their firm’s talent.  These efficiency increases will help law firms to better serve the needs of their clients immediately by offering reduced legal expenses while maintaining highly-competent representation.  Businesses looking for quality legal representation should look to law firms that demonstrate good business values, especially efficiency and adaptability, to best serve their needs, both legal and financial.

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