The Edge in 2017: The legal industry in the year ahead
In a 1966 speech in Cape Town, South Africa (referred to as the “ripple of hope”), Robert F. Kennedy referred to living in “interesting times”. Some claim this to be the English translation of an ancient Chinese curse, part of an address which dwelt on the late 1960s as a time of “danger and uncertainty, but…also the most creative of any time in the history of mankind”. In the post-Brexit, post-truth, Industry 4.0 era, this should all seem very familiar.
January brings with it a collective general mental stock take, which usually involves business planning for the coming year. Helpfully, there’s some useful research which can inform that process, aided as it is no doubt by strong coffee and a new gym membership.
The Competition and Markets Authority recently completed a year-long study into the legal services sector, concluding that competition in legal services for consumers and small businesses is not working well. The sector’s major failing was found to be a lack of available information to help clients identify their legal needs, with very little clarity on pricing, quality and service to help clients make an informed choice and get the right advice at good value.
Solicitors are now expected to engage with developing comparison sites and feedback and review platforms to allow potential clients to make a better choice before engaging with them, based on the “experience of others”. Some firms (especially those with a consumer focus) are already doing so very successfully.
However, while some pockets of the profession might fear “TripAdvisor for lawyers” brings a reputational risk if a client is not satisfied, that should not deter the industry embracing social media and benefits of being able to engage with clients across a range of media. The digital revolution has enabled the profession to introduce new ways to extended access to justice to people who may previously have found it beyond their reach.
The challenge, therefore, seems to be on us as lawyers to ensure that (as far as possible) we don’t place clients in a position where they feel the need to take their complaint onto a public forum; client care in the digital age, online reviews and better engagement and marketing strategies are clearly going to become more and more important even if the right models and solutions to make them truly useful and reliable may take some time to mature.
According to TheCityUK’s UK Legal Services 2016 Report, the Legal Services Sector and its contribution to the economy continues to grow, against a backdrop of fundamental regulatory and commercial change and ongoing client pressure on fees and service delivery, not to mention the flourishing in-house community and emergence of newer business models and commoditised services looking for their line in our timesheets. What this means, whether we like it or not, is that we need to embrace innovation and disruption, and do so quickly. I’m not just talking about getting the best value out of IT, either – differentiating an offering is nothing new, but committing to it and doing so publicly may be the best way to really stand out against increasing competition.
What worries us most right now however (according to a recent survey by Andrew Otterburn of the Law Consultancy Network) are the old chestnuts of recruitment and retention. Millennial lawyers tend to move around more often when the opportunity presents itself, and being stuck in a firm which refuses to change with the times may well help them to make a decision to move that may not be as hard as it was to the previous generation.
And then there’s Brexit. Heading back to China for a moment, Western motivational speakers often refer John F Kennedy’s claim that their word for “crisis” is made up of characters representing “danger” and “opportunity”. That’s since been proven wrong, however Otterburn’s survey also revealed political uncertainty to be a major worry for law firms over the coming year, even if the rumours of its potential effect upon our work and profitability may be greatly exaggerated.
TheCityUK has also given this issue some thought in its report “The Impact Of Brexit On The UK-Based Legal Services Sector”, noting that the onus will be on us to continue to promote the UK as the jurisdiction and legal system of choice in commercial matters (based on quality, predictability, flexibility and commerciality), to get to grips with the sudden loss of reciprocal recognition and enforcement of judgments across the EU by working to ensure continuity (ideally transposing the Rome I and II Regulations into UK law through the mythical Great Repeal Bill and developing new systems to allow recognition of UK judgments in the EU and beyond) as well as the potential knock-on impacts of Brexit on our clients and their changing needs.
Those changing needs, however, also present opportunities. We’ll have a whole new set of legislation to advise on and clients will probably need our help more than ever, but whether or not the multinational clients who need and can pay for that advice (however pricelessly proactive it may be) remain in the UK post-Brexit or view English Law as being the right “standard” for their business remains to be seen. Whilst two years’ notice will help us to plan for what comes next, embracing innovation, disruption and irrevocable change is not something we can avoid any longer. The more things change, it seems, the less anything will ever be the same again.