Planning / White Papers
A great Leadership Conference. The MPIEs always excel.
I look forward to this Conference every year. It really helps me to be a more effective firm leader.
A very organized and well-run conference. Great food. Great hospitality.
Thank you for allowing me to participate. Your team is masterful at making all feel valued at your event and I dare say helping attendees see the value in attending.
Thank you for the invite to speak on the Managing Partner panel. Even though I have now attended 7 MPFs, I always bring back substantive and helpful information for my partners.
Hands down the best leadership conference for managing partners I've ever attended.
I highly recommend the MPF Leadership Conference. I've participated many times, as have several of my partners. We leave with new ideas and fresh perspectives every time.
I thoroughly enjoyed participating in this year's Conference. Thank you for your enthusiasm and leadership.
Thank you for what you do for our industry. I go to a lot of conferences, and your event is the one I look forward to and gain the most from each year.
Thank you for putting on another outstanding MPF Conference. I came away, once again, feeling reassured and encouraged.
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AttachmentThis report summarizes the findings of Smock’s annual Survey of the Legal Marketplace in which John and Peter interview managing partners and leaders of thirty large US law firms. They report that 2018 was a very good year for most law firms. The booming economy and much improved attention to firm management issues are leading to record years for many large US law firms. Here are a few strategies, they say, that are really paying dividends:
- Dealing with Underperforming Partners
- Focus on Industry Expertise
- Embracing Technology
- Investing in Professional Development
- Emphasizing Firm Culture
Nothing new here, but it underscores the importance of running your firm as a business, not a hotel for lawyers.
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This is one of a handful of “state of the legal profession” reports we look forward to every year. Like the 2019 Client Advisory featured last week, it says that 2018 was a good year for many law firms. Yet, some firms, especially the AmLaw 50 and well-run midsize boutique firms, performed much better than others. That is exactly what last week’s report said! This paper challenges firms to get really clear on their “position” in the market and build a model accordingly. It divides the market into “Unique Legal Expertise” (about 20-25% of the market); “Comprehensive Legal Services” (60-70% of the market); and “Ancillary Support Services” (10-15% of the market). It’s an interesting way to look at things and, as we sometimes do, we’ve highlighted the report so you can browse through it quickly and easily. Here are some highlights:
- Hot Practice Areas: Corporate, Litigation and Employment
- Cold Practice Areas: Bankruptcy, Patent Prosecution
- Firms Increasing Investment in Associate Compensation, Technology
- Markets with Highest Percentage of Lateral Partner Moves: Chicago, Atlanta
- Major Changes Since 2008 Recession: Shift to Buyers’ Market, More Aggressive Competition and Growing Use of Alternative Service Providers
We recommend that you read it, distribute it, and talk about it with your partners.
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The Client Advisory is the first of several “state of the legal profession” reports we look forward to every year. It says that times are pretty darn good for the AmLaw 200 law firms, especially the top 50 firms, which continue to improve running their law firms as businesses, including strategic planning, empowered leadership and partner accountability. Yet, not all law firms are performing well in the strong market. We’ve highlighted the report so you can browse through it quickly. In addition, here are some of its highlights:
- Good news: Total revenue growth for the profession is projected to grow 6-7 % in 2019.
- Bad news: Expenses – driven primarily by associate salaries and investments in technology – grew by 5.9% in 2018.
- Well-run small and mid-size “niche firms” continued to perform well in 2018.
- Firms with an industry-focused approach outperform firms that organize around areas of law.
- The most successful firms invest in their most profitable core practice areas while addressing underperforming practices.
- Alternative fees continue to grow and now account for 19% of aggregate firm revenue.
- About half of surveyed law firms have mandatory de-equitization policies in place, with an average age of 67 years.
- Client transitioning always take longer than expected. Firm management must be involved.
We strongly recommend that you read and digest this report, distribute it to your partners and discuss its implications at your next partner meeting.
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Now in its tenth year, Altman Weil’s annual survey documents the forces reshaping the landscape for legal services and provides insight on how the nation’s largest law firms are responding. 398 firms with 50 or more lawyers participated, including half of the country’s top law firms. The full survey report runs 128 pages and contains lots of charts and graphs. The more digestible Executive Summary runs just fifteen pages.
Key Findings:
- Change is Everywhere
Not one survey respondent said the pace of change to decelerate in the coming years. The good ole days are long gone and there’s no going back.
- Complacency Has Set in at Many Firms
Partners are underutilized at most firms with almost half of firm not meeting billable hour goals.
- Most Firms Are Focused on Short-Term Tactical Improvements
Few firms have not taken full advantage of disruption as an opportunity to run with an innovative set of services to distinguish themselves from competitors.
- Firms Need to Think More Long-term and Strategically
Just 38% of firms are actively testing innovation. Look outwardly at ways your firm can improve efficiency and added value for clients in the long run.
- Partners Are Your #1 Impediment to Change
Improving productivity and dealing with chronic underperformance has yielded significant improvement firm profits in 84% of participating firms. In 69% of firms, partners are highly resistant to most change efforts.
MPF Recommendations to Firm Leaders
- Educate your Partners
Most of them pay little attention to the “big picture” trends and challenges facing the profession. As a firm leader, make sure they know what’s going on, and why your firm must evolve and adapt to the changing marketplace.
- Get Closer than Ever to Clients
Never ever take clients you want to keep for granted. Show them you really care. Go visit. Learn about their companies. Learn about their industries. Become a trusted advisor.
- Focus Attention on Practice Groups
We like industry-focused practice groups for a slew of reasons.
- Exercise Passionate and Purposeful Leadership
That means implementing tough decisions from to time. Enough with the “managing” and “consensus-building”
already.
- Appoint the Right People to Leadership Positions
Not always the senior lawyers and lawyers with big books of business, but individuals with firm-first mindsets and the ability to run a good meeting.
- Address Bad Behavior and Chronic Underperformance
If you don’t, it may kill your firm’s long-term success. Your firm’s “dynamos” don’t want to carry dead weight.
This is one of the best “state of the profession” reports out there, and we strongly encourage you to share it with your partners and senior staff.
- Change is Everywhere
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Here’s another annual report – this one published by Smock Law Firm Consultants – that we call to your attention. It’s based primarily on interviews with CEOs and COOs of 41 large and midsize law firms, along with review and analysis of recent reports on the legal marketplace. We especially like the one-page overview that presents lots of information in a simple and focused manner. Here are few of the report’s major findings:
- 2017 was a very good year for most US law firms, with many reporting their best year ever.
- Transactional practices (like corporate, real estate and tax) performed well, while litigation remains flat now and into the foreseeable future.
- Although billable hours were down slightly for all types of time-keepers, rate increases – averaging 2-5% – made up for much the lost productivity.
- 2018 is projected to be another good year for US law firms, but there are several potential negatives looming on the horizon, including an economic downturn, more demanding clients and continued flat demand for litigation services.
- Larger firms consistently bring a more business-like approach to running their operations, including dealing with chronically under-performing partners and eliminating excess capacity within their associate and paralegal ranks.
John Smock and his colleagues bring a hard-nosed approach to how a successful law firm needs to operate, and we agree with almost all the comments and recommendations they make at the end of the report.
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This annual report does a great job highlighting significant trends that are reshaping the market for legal services, including observations that future success is unlikely to be achieved by traditional strategies and approaches. Here are a few of
the report’s highlights:- Overall, US law firms have experienced sluggish demand growth since the Great Recession. In fact, the overall demand for legal services has remained flat since 2010.
- Despite a flat market, the AmLaw 100 firms have seen slightly improved growth. On the other hand, the AmLaw 100-200 firms have seen a noticeable decline. MidLaw is holding steady.
- Demand growth was slightly positive in corporate, tax and IP litigation, but was negative in all other practice areas.
- Productivity (measured in terms of billable hours worked) for all categories of time-keepers continues to trickle downward, most notable among the “Of Counsel” ranks.
- Although it appears that law firms are “holding their own” since 2008, the market is not as healthy as it may appear on the surface. A deeper look suggests that there are a variety of issues in play that should concern firm leaders, especially the future impacts “alternative legal service providers,” such as accounting firms and legal staffing services.
- Law firms that proactively implement changes in the way they deliver legal services will emerge as the big winners, while those that do not will remain static at best.
- Dynamic and growing law firms invest considerably more in marketing/business development and technology than static firms.
Times are changing. Is your firm keeping pace?
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This annual report does a great job highlighting significant trends that are reshaping the market for legal services, including observations that future success is unlikely to be achieved by traditional strategies and approaches. Here are a few of
the report’s highlights:- Overall, US law firms have experienced sluggish demand growth since the Great Recession. In fact, the overall demand for legal services has remained flat since 2010.
- Despite a flat market, the AmLaw 100 firms have seen slightly improved growth. On the other hand, the AmLaw 100-200 firms have seen a noticeable decline. MidLaw is holding steady.
- Demand growth was slightly positive in corporate, tax and IP litigation, but was negative in all other practice areas.
- Productivity (measured in terms of billable hours worked) for all categories of time-keepers continues to trickle downward, most notable among the “Of Counsel” ranks.
- Although it appears that law firms are “holding their own” since 2008, the market is not as healthy as it may appear on the surface. A deeper look suggests that there are a variety of issues in play that should concern firm leaders, especially the future impacts “alternative legal service providers,” such as accounting firms and legal staffing services.
- Law firms that proactively implement changes in the way they deliver legal services will emerge as the big winners, while those that do not will remain static at best.
- Dynamic and growing law firms invest considerably more in marketing/business development and technology than static firms.
Times are changing. Is your firm keeping pace?
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This hard-hitting and ground-breaking report, which includes an abundance of benchmarking data drawn from two MPF surveys conducted earlier this year, serves as a wake-up call for leaders and owners of smaller and mid-size US law firms. We strongly maintain that to be successful in the future, law firms must be run more like a business and less like loose confederations of sole practitioners. For most firms, this involves change and accountability. And lawyers don’t like either. Leadership and planning are required. Here are some of our report’s major themes:
- Firm owners must accept the fact the profession is undergoing unprecedented change and that your law firm must adapt if it wants to survive and prosper.
- Strategic planning is no longer optional. Firms need a vision for the future and a plan to get where they want to go. “Hope and pray” is not a good strategy in a rapidly changing marketplace.
- Firms must invest in the leadership and business development skills of their young lawyers. They are the future of your firm.
- Importantly, law firms must proactively address issues involving problematic partners. They are affecting the culture and profitability of your firm much more than you realize.
- The time has come for firm leaders to exercise “more leadership” and “less management.”
You need to review this report. You need to share it with your partners. Importantly, your firm must respond to the changing marketplace. Otherwise, you may find yourselves selling buggy whips when the rest of the world has moved beyond them.
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Earlier this year, the ABA’s Commission on the Future of Legal Services issued its long-awaited report on the future of the legal profession. Its findings and recommendations should be of little surprise to those who read our newsletter and attended our conferences.
- Many recent law school graduates are underemployed, or unemployed altogether.
- The traditional law firm model (including the almighty billable hour) constrains innovation to enhance the delivery of legal services.
- Lawyers' resistance to change further hinders innovation in the profession.
- New providers of legal services (e.g. Avvo, Axiom, Legal Zoom and Rocket Lawyer) are proliferating and providing additional choices to both clients and lawyers.
- Lawyers must learn more about entrepreneurship, innovation, law firm economics, and the business of law.
- The ABA should establish a Center for Innovation.
- The ABA should continue to explore the feasibility of Alternative Business Structures (ABSs), including non-lawyer ownership of law firms.
We encourage you to take a look at the attached report and consider its implications for your firm. We’ll be discussing the fall-out of this report in future issues of The MPF Weekly.
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This issue of Internatinal Review, published by Patrick McKenna, runs 24 pages and features five great articles every firm leader should read. They include numerous practical ideas, tips and techniques that will make you a more effective firm leader and that you can put to use immediately. The articles in this issue are:
- Recovering from a Leadership Misstep
- The Leadership Succession Process
- Stimulating Innovation in Your Firm
- Inquiring Leaders Want to Know: Ten Important Questions
- When Job Descriptions Don’t Do the Job
We especially recommend the fourth article and its ten important questions.
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We surveyed law firm leaders earlier this year about strategic planning and implementation. 120 managing partners, mostly from mid-sized law firms, participated. As this White Paper reveals, more and more small and mid-sized law firms are getting into strategic planning and they report good results. Consider these findings:
- Fifty-nine percent (59%) of firm leaders say they have a firm-wide strategic plan.
- Just nine percent (9%) say they’ve done “very well” on implementation. Forty-three percent (43%) say they’ve done “pretty well.”
- Even then, seventy-seven percent (77%) say the plan’s impact on firm performance is “very successful” or “somewhat successful.”
Imagine the positive impact on performance if law firms did a better job on the implementation side of the planning process! In addition to fresh data on the topic, we share the keys to success.
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Over the course of the year, Smock Law Firm Consultants has published and distributed a series of reports on four major US legal markets. The markets they cover are Chicago, New York, Cleveland and Atlanta. To develop these reports, John and his colleagues conducted numerous interviews with managing partners and firm administrators to learn about current trends and happenings, and hear their predictions for the future. The consultants also provide their analysis and commentary, as well. Here are a few highlights:
- 2014 has been a strong year for most mid-size law firms. 2015 looks promising, as well.
- Profitability, industry-focused marketing and client service are major areas of focus for many mid-size firms.
- Most mergers, acquisitions and lateral hires – 75% says Smock – are not successful, often due to lack of due diligence and failure to fully integrate the combined entity.
- Improved planning and project management are more important than ever for mid-size firms.
- In many firms, young lawyers are not “stepping up” to assume important leadership and ownership roles.
These reports contain some great insights and recommendations, even if your firm has no presence in these four markets.
Click here for Chicago Legal Market Report.
Click here for New York Legal Market Report.
Click here for Cleveland Legal Market Report.
Click here for Atlanta Legal Market Report.
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Back in the go-go days of the 80s and 90s, law firms built pyramids and it was all about leverage to ramp up firm profitability. Back then, it was a seller’s market. There was plenty of work. Partners brought it in and fed it to a growing legion of highly profitable associates.
But times have changed, and US law firms are now facing the stark realities of a buyer’s market. As a consequence, many firms now find themselves with a “diamond” structure characterized by a small number of junior associates at the bottom and a growing number of non-equity partners, of counsel and staff attorneys in the middle. But is such a model sustainable over the long term? This paper says no.
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Collectively, MPF Faculty member John Smock and his colleagues have more than 150 years’ experience working with professional services firms. They draw on this experience to regularly publish thoughtful articles on law firm leadership and planning. This one sets forth a strong approach to whip your firm into shape, including planning, governance, compensation and dealing with partners who aren’t pulling their weight.
