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A prophecy of "immense and irreversible change" in the legal sector - and what to do about it,
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This review is from: Tomorrow's Lawyers: An Introduction to Your Future (Kindle Edition)
I bought Professor Susskind's "The future of law" back in the late nineties, shortly after getting involved in the management of law firms for the first time. I regret that I did not read it as attentively as I should, having found David Maister's work Managing The Professional Service Firm to resonate far more with the kind of law firms that I wanted to work with. Of course, with a twenty year timescale, it was very much a book about the future, while Maister was writing about the past and present, at a somewhat rarefied, elite level at that. As Susskind reminds us in Tomorrow's Lawyers, a beautifully succinct update of his several previous works, his original prediction may be judged in 2016, and he has a confidence - bordering, dare I say it, on arrogance - that he's been more right than wrong.
Susskind discerns three main drivers of change: the "more-for-less" challenge, liberalization, and information technology. Clients have growing legal needs: at one end they feel that they are overpriced when delivered by traditional means, and at the other they simply cannot afford them and have to wing it and risk the consequences. Help is at hand, however. IT, as demonstrated already in a host of applications inside and outside the legal sector - Susskind mentions eBay, Kodak, Legalzoom and Epoq among others - has the potential to fulfil needs in a host of ways that are highly disruptive of existing business models. Liberalization, whether through the medium of the Alternative Business Structure (ABS) or by businesses that provide solutions for clients without the need to come anywhere near the regulated sector, will enable entrepreneurs, especially those well versed in IT, to, meet the more for less challenge, and in so doing to put many traditional law firms out of business.
While he envisages a global elite of 20 or fewer top firms, Susskind suggests that in order to win a future law firms will need to meet the "more for less" challenge through efficiency and collaboration.
Efficiency goes well beyond simply making traditional processes more efficient, still less cutting down on marketing and support staff costs. The crux will be "decomposing" legal work into its constituent parts, identifying where each of those processes fit within a spectrum from bespoke to commoditized, and then "alternative sourcing" and "multi-sourcing" each process to the most cost effective provider, many of whom will not be within a traditional firm nor even new model provider. Susskind provides an extensive list of alternative sources of work provision, including out-sourcing, near-sourcing, and leasing (leasing lawyers, that is!). At his most radical he suggests that artificial intelligence will replace human lawyers, e.g. in document review and indexing tasks.
Collaboration may be between lawyers as providers, between in-house counsel and lawyers in practice, but more so even than that Professor Susskind envisages collaboration being between clients. He points to Allen & Overy, for example, working for multiple banking clients and providing a common regulatory and compliance service, or law firms providing a similar combined service for local authorities. "class action" for transactional work? The author envisages law firms taking the lead in orchestrating such collaboration; they may lose opportunities for hourly billing in the short term, but the leaders will be bold enough to recognise the long term threat will increase their market share by seizing the first mover advantage. Collaboration is substantially about changing much of law from a one-to-one personal service to a one-to-many solution to clients' needs. Providing automated documentation and online legal services are among other strategies Susskind summarises to achieve that end.
Susskind suggests, not for the first time, that there is little future for the "general purpose small firm", which he envisages will largely be squeezed out by new entrants to the liberalized legal marketplace - banks, retailers etc - by 2020 or so. There will be a space for niche specialists and those offering a truly personal service (to those who attach value to that kind of service and who can afford to pay for it!) Some medium-sized firms (it would have been helpful if he had explained at what point a small firm becomes medium sized), through merger and bringing in external investment may, he suggests, be able to develop new and sustainable longer term business models. On the whole, however, Susskind seems to suggest that much of the legal market (worth £25 billion in the UK alone, he says) will be seized by new types of providers. The last third of the book is devoted explicitly to considering the prospects of those who are just embarking upon careers in the law, and he lists many potential new types of employer, starting with the global accounting forms which he believes will soon re-enter the legal services marketplace.
This is surely a "must read" book for anyone involved in or interested in the legal profession in the UK and elsewhere. Many who read it will hope that the future prophesied by Susskind does not come to pass, but at least they will be able to discern the potential threats to their traditional legal businesses more clearly. Some may say that they think that the "more for less" challenge is overstated, and that their clients are satisfied that they are getting value for money at the moment. Many may take comfort from the thought that many of his ideas will be difficult or impossible to deliver under the current regulatory regime. They may be right, as many of the new legal providers will not themselves want or need to be regulated as solicitors, barristers or by the other specialist regulators in the legal profession. Some, Susskind presumably hopes, will see entrepreneurial opportunities to build those new businesses, and in so doing better and more affordable legal solutions for those who need them while fashioning for themselves very different careers than the tradition route to partnership.