Posted by Nigel Wallis, partner at Legal Futures Associate O’Connors LLP
Had Isambard Kingdom Brunel been a lawyer and not an engineer, suspension bridges might have remained the domain of orthodontists and we might still be rowing wooden boats to the Balearics for our summer holidays.
As it turned out, his engineering genius helped shape the Industrial Revolution and put the Great into Great Britain – in much the same way my colleagues say I put the bone into bone idle.
According to Horrible Histories, the Industrial Revolution changed forever the way goods were made as mechanisation moved the country from workshop-based micro production to factory-based mass production. Falling costs and rising efficiency led to lower prices and faster delivery.
Once consumers had tasted the forbidden fruit, there was no going back and flat-cappers found themselves working weekends to keep the industrial magnates in their shiny toppers.
There is much evidence to suggest that the legal sector is now at the forefront of the Professional Revolution – a term which, if adopted, could land me an entry in Wikipedia, somewhere between David Walliams and Robbie Williams.
Wide-scale regulatory reform, a succession of competition-hungry governments, comparison websites, Google-educated do-it-yourselfers, AI (the IBM, not the Countryfile, version), sophisticated IT platforms and increasingly savvy buyers are changing forever the way legal services are bought and sold.
Add to these factors the profession’s passion to do the right thing by its clients and we are seeing a downward pressure on fees, accelerated response times and the biggest shake-up of the legal sector since at least the advent of email. Like the Industrial Revolution, the Professional Revolution looks unstoppable and the pace of change likely only to accelerate.
If the Industrial Revolution taught us anything (beyond the fragile nature of our ozone layer), it was that revolutions create both winners and losers. Over the medium term, those with the time and financial muscle to invest in meeting each new challenge become stronger and those without it become weaker.
This dynamic creates the ideal conditions for market transformation and the transactional activity we have seen so far is likely to be just the tip of the iceberg.
Against this cheery backdrop, if you want to give your law firm the best chance of being on the winning side, here are six business basics that will help provide a firm foundation for success:
Stick to the business fundamentals
Before and since Isambard Kingdom Brunel was a lad, successful law firms have been good at finding the work, doing the work, billing the work and collecting the bills. Try not to let the revolutionary white noise distract you from these core business fundamentals and from doing them really well.
Trust your gut
The fact that you are still in business today means that you know what you’re doing. So follow the gut instincts that have served you well and keep on with the things that your experience tells you work – like doing a fantastic job for every client, showing them how much you care, listening to their needs and keeping those who recommend you motivated to do so again.
Watch your cash
Even very profitable businesses go under because they run out of cash. So watch your bank accounts like a hawk, don’t shock your bank manager with nasty surprises, don’t breach banking covenants, don’t take on liabilities you haven’t pre-funded and try not to draw profits you haven’t yet made.
Monitor, rather than mirror, your competitors
Don’t waste your time trying to keep up with the Kardashians. Do things your own way and spend all your excess energy explaining your special proposition to your clients and recommenders.
Nail your route to market
Whether you generate business leads via direct marketing, Google Ads, social media networking, joint venturing with work referrers or local or national advertising, try to have as few intermediaries as possible wedged between you and your paying clients. The huge upsurge we have seen in advice on alternative business structure collaborations and investments into law firms has largely been driven by the desire of collaborators and investors to back law firms whose future work flows are under their own control.
Run until you’re tackled