Mark Cohen: Legal Insights and Industry Commentary
Mark Cohen is a valued Contributor and Advisory Board member. His article originally appeared on Forbes
The most accomplished lawyers are those that become ‘trusted advisers’ to clients. That means their counsel is sought not only for discrete cases but also on an enterprise basis—and not just for ‘legal’ matters. The trusted adviser has a profound understanding of the client’s business and provides professional judgment, emotional intelligence, candor, and experience tailored to the client’s risk tolerance, enterprise objectives, and company DNA. That’s a far cry from simply ‘knowing the law’ or ‘handling a case.’
Law firms have profited handsomely from trusted adviser colleagues– ‘excellence by association.’ Clients have long said that, ‘We hire lawyers, not a law firm.’ Let’s take them at their word noting that, until recently, retaining the lawyer also meant hiring the firm’s cast of supporting attorneys– and enduring big hours, high rates, faux budgets, and sticker shock. Trusted advisers—a subset of rainmakers– perform the critical functions, delegating all other tasks — the bulk of legal expense—to others. This suited the firm’s pyramidal structure and was tolerated by clients because there were no alternatives.
Clients can now ‘hire the lawyer’ without the baggage of the firm. The ‘practice of law’ is no longer synonymous with ‘the delivery of legal services. Legal delivery is now bifurcated; it is ‘the practice of law’ and the ‘delivery of legal services.’ The former refers to the core tasks that licensed, experienced, lawyers perform—counseling clients, representing them in tribunals, and rendering strategic advice in commercial transactions. The latter describes the process by which technology and process are deployed to reengineer the business of delivering legal services—the business of law. This process is often described as ‘disaggregation’ or the ‘legal supply chain.’ And just as outstanding legal practitioners emerge as ‘trusted advisers,’ so too is there an emergent cadre of ‘trusted adviser’ legal service providers that may or may not be lawyers. Translation: legal delivery is not just about lawyers anymore.
‘Legal Practice’ is now a component of ‘Legal Delivery’
Legal practice is a component of legal delivery in the same way that medical practice/expertise is an element of healthcare services. Legal operations, an amalgam of interrelated disciplines designed to improve the customer experience by efficiently and measurably resolving business challenges raising legal issues, is an equal partner in the new legal delivery paradigm. That means that trusted advisers with practice expertise now share the spotlight with peers providing delivery excellence. And while the practice of law and business of law intersect, clients are apt to have two types of ‘trusted legal advisers’–one for ‘practice,’ the other for the ‘business of law.’ Each is essential in providing clients with competent, effective representation that delivers value and business impact.
Elite service providers have secured a firm footing in the marketplace by reengineering the delivery of ‘fat middle’ (non-bespoke corporate) legal tasks once performed by law firms. The new model providers—and that includes some in-house legal departments—have corporate structures that reward efficiency, output, and results, not hours, revenue, and origination. They offer key stakeholders equity that creates an economic alignment with the long-term success of the enterprise. They are focused on clients– not preservation of PPP– and constantly reassess delivery methods (by relying on data and customer feedback), customer alignment, and pricing models that are very different than traditional partnership model law firms. Many ‘legal’ tasks once performed by ‘brute force,’ labor intensive firm lawyers have been routinized and are now delivered either as products or services via efficient, cost effective resources—human and/or technological. Legal service providers have migrated up the complexity chain. Their ‘alternative provider’ moniker –like so many other inaccurate, pejorative ‘alternative’ references in legal nomenclature– should be jettisoned. What was once ‘alternative’ is now mainstream. Trusted advisers with delivery expertise are every bit as important as those with elite practice skills. And to maintain their elevated status, each must be conversant with the other’s skillsets. The integration of legal practice and legal delivery is the next phase of law’s evolution.
From a functional perspective, the dividing line between law firms and service providers has become blurred, especially in the corporate segment of the legal market. Legal practice and legal delivery are distinct–yet interconnected– elements of the process; one without the other affords the consumer a half-loaf, not a whole. And while elite legal service providers—and that includes corporate legal departments and companies—are now providing managed services solutions, the industry has yet to see a scalable provider that fully integrates the two. It’s inevitable that this fusion of the practice and business of law— pioneered by Clearspire nearly a decade ago– will reappear.