The ‘great leap’ forward? Your law firm post-Covid-19
Egorov Puginsky Afanasiev & Partners, London/Moscow
Ekaterina Rozenbaum, Egorov Puginsky Afanasiev & Partners, London/Moscow and Assistant Outreach and Education Officer, IBA Law Firm Management Committee
Albert Bollard, McKinsey & Company, New York
Charles Martin, Macfarlanes, London
Rosemary Martin, Vodafone Group, London
- Charles: ‘Never waste a good crisis (as per Churchill’s famous quote). Focus on culture! This is the moment for the Darwinian evolution of the law firm.’
- Albert: ‘Have a plan, make decisions for the most “vibrant” part of the partnership.’
- Rosemary: ‘If you want to be preferred counsel, ensure you build that relationship and work on it. It’s the inside, as well as the outside, that counts.’
1. What’s different this time around:
- Impact will be very different in different sectors/types of work within the firm (for example restructuring, employment, insurance and litigation strong).
- Some industry sectors have been affected positively or at worst neutral: telecoms (as explained by Rosemary), technology, healthcare and pharmaceuticals.
- Some sectors catastrophically affected: manufacturing, hospitality and travel.
- Financial services generally buoyed by liquidity and fee income.
- Corporates focusing on liquidity and survival as well as stakeholder relations – as the ‘new normal’ dawns, the focus will be on resilience, digitalisation and strategic rationalisation.
- From a law firm perspective, once there is visibility there will be a huge amount of activity.
2. What does this mean for law firms – what should they do to ensure resilience?
- Snapshot of what was implemented at Macfarlanes in the global financial crisis, what worked well and what could have worked better.
- Thirty per cent drop in profits/successful turnaround but it took too long – why?
- We were too transactional before and had the wrong focus in a number of practice areas: what did we do about it?
- The summer of 2010: partner departures, abolition of committees, reshaping of practice areas (especially real estate) and above all reaffirmation of the true culture of the firm.
- Doubling down on international and the global alliance of the unallied.
- Which law firms are more resilient in downturns? What are the key principles to adhere to?
- have a plan/a strategic vision – deliver for the most vibrant part of the firm (circa 30 per cent) – the ‘culture carriers’.
- ‘Grow or go’ mantra.
3. Client perspective
Charles and Albie have stressed the importance of being ‘connected’ to their clients – what does that mean to you? What has been done well and what is left wanting?
- Right: keep connected to clients – try to anticipate what they are dealing with. Hard law and training around certain aspects, for example, force majeure.
- Wrong: interesting moments of reflection of individuals in law firms: are the laws that we have adequate for what we now need?
- What has been wanting? Shocked by what felt like the fragility of law firms becoming very apparent. Partners reducing payouts, furloughing staff, relying on government support very quickly into the crisis. What does this say about your business resilience (especially when you are tasked with advising on ours?).
- How certain aspects had been communicated to clients – is this how you communicate internally?
- Big corporate executives took a lot of criticism/took slack – who is holding law firms accountable?
- We take our purpose and values seriously – we expect to see this in the companies we choose to work with.
- In a crisis, people turn to people like them.
4. Where to compete/how to compete
- Full service versus boutique?
- Talent acquisition?
- Diversity (this echoes Rosemary’s point on clients wanting to choose firms that have similar values to them).
- How do firms ensure they bring value and that they are ‘part of the opportunity’, not the cost?
- How not to get ‘locked into’ a discounted pricing model, but still compromise as far as client expectations are concerned.
5. Are things really different post-Covid-19 (or ‘during’)?
- Are these changes that every law firm should have been implementing over the last decade (we have been talking about ‘legal market disruptions’ since forever).
- Is this the final push, the ‘great leap’ that law firms must take in order to survive and drive forward?
The webinar can be viewed here.