There is not much of a future for small, high street law firms in the face of competition from banks and retailers, while medium-sized practice will need to merge and seek external investment to survive and thrive, leading legal ‘futurologist’ Professor Richard Susskind has predicted.
In his new book – Tomorrow’s lawyers: An introduction to your future – Professor Susskind said his analysis of the legal market is that “law firms in the coming decade and beyond will be driven relentlessly by their clients to reduce their costs”.
The book, aimed at law students, outlines and updates the academic’s well-known predictions of how the market will develop, driven by what he terms the ‘more for less’ challenge, as well as liberalisation and technology.
He said that unless small firms offer a genuinely specialist or personal service that some market is prepared to pay for, they do not have much of a future beyond 2020.
High street practices will face competition from banks and retailers; “it is likely that these alternative business structures, fuelled by external investment and driven by experienced business managers, will standardise, systematise, and package legal services and bring cost savings, efficiencies, and experience that the traditional, small firms will find impossible to match. This will be the end of lawyers who practise in the manner of a cottage industry”.
The future is rosier for medium-sized firms. “To survive and thrive I suspect most will need to merge and seek external investment to enable the changes from their current approach to a new, sustainable, longer-term business model.
“There is a window of opportunity here – they should recognise that clients’ dissatisfaction with some of the leading firms throws up an unprecedented opportunity to be recognised as credible alternatives. To do this, they must find ways of building their reputations, brands, and capabilities.”
Professor Susskind accepted that there is some force in the argument from the largest ‘elite’ global firms – which he numbered at about 20 – that for bet-the-ranch deals and disputes, clients will still want the services delivered, more or less, as in the past.
“However, they should not be overconfident… If one leading firm breaks rank, or if a major new force (such as a ‘Big 4’ accounting firm) emerges, and brings a new proposition to the market – a credible brand at half the price of its competitors, for example – then this could fundamentally and irreversibly change the market; and not just for the elite firms but across the entire profession.
“Leaders of the elite firms should suspend their likely incredulity at this scenario, if only because major clients, as never before, are commonly saying that they are now actively looking for alternatives to the traditional ways of some of the great firms whom many regard as too costly and sometimes too arrogant.”
Professor Susskind forecast that within a decade or so, “after intense agonising and various changes of direction, most major jurisdictions in the West and many emerging jurisdictions will have liberalised in the manner of England”.
The book lays out his vision of new legal jobs – such as legal knowledge engineer and legal project manager – and that in addition to conventional legal practices, a host of non-traditional employers will be waiting to employ future lawyers, including new-look law firms, high street retailers and online legal services providers
However, he advised that “it still makes sense, in the first instance, to qualify as a conventional lawyer. This may not be necessarily but I think it desirable, not simply because it will for many years yet be useful to enjoy the status of being, say, a qualified solicitor or barrister, but because exposure to and understanding of traditional legal service should provide a valuable foundation upon which to build any new career in law”.
Professor Susskind was critical of traditional law firms for not wanting to change, but told aspiring lawyers that “as never before there is an opportunity to be involved in shaping the next generation of legal services”.
To order a copy of Professor Susskind’s new book, click here.