CSLP Papers & Reports

2013 Report on the State of the Legal Market

Mon, 25 Feb 2013 05:35:09 PST

As we enter 2013, the legal market continues in the fifth year of an unprecedented economic downturn that began in the third quarter of 2008. At this point, it is becoming increasingly apparent that the market for legal services in the United States and throughout the world has changed in fundamental ways and that, even as we work our way out of the economic doldrums, the practice of law going forward is likely to be starkly different than in the pre-2008 period. The challenge for lawyers and law firms is to understand the ways in which the legal market has shifted and to adjust their own strategies, expectations, and ways of working to conform to the new market realities. While there is certainly evidence that some firms and lawyers have begun to make these adjustments, many others seem to be in denial, believing (or perhaps hoping) that the world will go "back to normal" as soon as demand for legal services begins to grow again.

Legend has it that in 1519, when he and his cohort of some 500 soldiers and 100 sailors landed on the shores of the Yucatan intent on conquering the large and powerful Aztec empire, Spanish conquistador Hernando Cortez promptly ordered his men to "burn the ships." Cortez knew that, unless more tempting alternatives were removed, it would be difficult to motivate his men to take on an empire with a large army that had been in power for more than six centuries. Hence, his bold and decisive order.

The legal market today is an increasingly difficult and challenging environment, one that calls for clear thinking, strategic focus, and flexibility in addressing rapidly changing realities. To an unfortunate extent, however, many lawyers and law firms seem stuck in old models–traditional ways of thinking about law firm economics and structure, legal work processes, talent management, and client relationships–that are no longer well suited to the market environment in which they compete. Perhaps it's time for us, like Cortez, to burn the ships–to force ourselves to think outside our traditional models and, however uncomfortable it might be, to imagine new and creative ways to deliver legal services more efficiently and build more sustainable models of law firm practice.

This report describes the trends that have been observed in the legal market in 2012, exploring the longer term implications of those trends for the future, and suggesting some ways in which lawyers and law firms can better position themselves to deal with new emerging market realities.

Developing Attorneys for the Future: What Can We Learn From the Fast Trackers?

Lori Berman et al. — Fri, 28 Sep 2012 07:10:08 PDT

Leaders in law firms tend to be those attorneys who thrive in a law firm environment from the beginning—successful associates who become successful partners. Later, they are asked to be the leaders of practice areas, committees and, ultimately, part of senior management. While high-performing associates may not be formally promoted to leadership positions for some time, it is important to understand what makes them—as young associates—stand out from their peers. Who are these future leaders, and what qualities predict their advancement in a law firm environment? These are the questions we set out to explore.

To date, little empirical work exists on the characteristics and behaviors of high-potential associates—how to recognize them from the beginning and how to develop them. Instead, law students continue to be hired most commonly based on the law school they attended and their GPA, under the assumption that law school and GPA are related to future performance as an attorney. Transcript and resume review are typically accompanied by a series of 30-minute interviews consisting of questions that vary from candidate to candidate. Consequently, hiring decisions result from a combination of the reputation of the law school attended, GPA, and the interviewing partners’ gut feeling.

Law Firms, Ethics, and Equity Capital: A Conversation

Wed, 12 Aug 2009 14:49:29 PDT

The correspondence collected here represents an effort to start a conversation. Pending legislation in the United Kingdom, based on what is known as the Clementi Report, would permit non-lawyer equity investment in law firms, subject to regulatory oversight. In other words, UK law firms could become publicly-traded businesses. This legislation has been proposed as part of reforms heralded as improving the delivery of legal services to consumers. By contrast, such investment in law firms is forbidden by ethical rules in the United States. What will happen when the two countries with the most dominant global law firms begin to move along such different paths?

Australia already allows such investment, but the prospect of major UK firms raising capital in the equity markets has the potential to produce seismic shifts in the global market for legal services. It also could have far-reaching implications for the legal profession that we can only dimly anticipate. Until now, there has been remarkably little discussion -- especially in the United States -- about the possible effects of the UK legislation.

This paper attempts to redress that situation. It consists of an exchange among Bruce MacEwen, an expert on law firm economics and editor of the on-line publication Adam Smith, Esq.; Mitt Regan, a Professor at Georgetown University Law Center, an expert on the legal profession; and Larry Ribstein, a Professor at the University of Illinois College of Law, an expert on partnership law.