MODERNIZING THE LAW FIRM
May 29, 2012
by James Forrest
I have this very good friend who likes to characterize me and my fellow entrepreneurs, ultimately, as “people who have a problem with authority.” Of course, he’s making an exaggerated point (I sure hope so, in my case!), but the fact is that many entrepreneurs are marked by either a confidence or hubris that makes them want to zag while the rest of their field zigs.
It’s the rare entrepreneur that’s driven by sameness—most strive to be different, even if what we’re doing is one of the world’s older professions. So it is with the law.
A lot of people may perceive me and my firm in a certain way, the old, “he worked in some really great, big firms and wanted to do his own thing.” While that’s certainly true, on a more epidermal level, it’s a pretty gross oversimplification of what was going on in my head in the months and years leading up to starting the Forrest Firm.
The fact is, I loved my profession, my practice, my colleagues, and, especially, my clients. People who work at large, reputable law firms have a great quality of life, personally, and, after those early “dues-paying” years, professionally. But some time ago, I started developing an itch that became uncontrollable. And it wasn’t to launch my own firm for its own sake.
I realized that I was laboring within a somewhat broken business model, a framework that simply didn’t fit the speed and diversity of modern business. Though business itself had passed through several iterations of evolution, the law firm had been operating under the same business architecture for a long time. The accepted model, for generations, had remained a few partners at the top with a littany of associates, interns, and support staff near the bottom of the org chart — inevitably there is some inefficiency. This sometimes leads to unpredictable billing structures and fees, usurping the entrepeneur’s discretion realted to its legal spend. This model could only have succeeded wildly during times when prospective clients were breaking down the doors to do business with those big firms. As we know, that dynamic has changed dramatically in the last 5 years. I believe that clients now demand a different approach—even a set of approaches—by business attorneys to be better partners and advisors to our clients.
What’s driving these changing dynamics are things like periodic recessions, like the one we’re pushing through and emerging from right now, a glut of attorneys in the marketplace (too many of us, and not enough clients to go around), the onslaught of technology dictating a higher level of speed within the economy, and the emerging paradigm where more and more businesses work together with each other—even in the form expressed by the term “co-opetition.” Thus, our clients have even greater demands of us as business attorneys, because they are faced with even greater demands themselves.
With these drivers in mind, I set about creating a new framework for the legal business that has become the evolving model of the Forrest Firm. We base this model on core principles that mirror the exact needs of our clients for the times and challenges they face in their respective businesses and sectors. The first aspect of the old model that we decided to attack was the billing structure. While the old “here’s what I bill and here’s when the clock starts ticking” hourly model still fits some companies, we created a retained service framework that models on some predictive billing.
Early in the engagement with a new client, we can assess their initial and ongoing business needs and determine an ongoing cost system that works for our firm and the client. One frame of reference for this is how many utility companies are providing customers with estimates and doing bill averaging, so that customers can plan personal cash flow across the year. In this same way, we’re able to insert ourselves into the normal cash-flow planning for a business, never surprising our clients with billing that leads to a drag on the business at critical times.
The next aspect of the old framework that we studied and improved upon was that of access. Traditionally, business attorneys have been office-bound creatures — “there when you need us.” In today’s business world, the definition of where “there” actually is has changed. They need us to come to their place of business and lead executive strategy sessions, as well as take lead, on-site roles in strategic partnership discussions with aligned businesses and even competitors.
Many clients crave quicker response times—to meet very pressing market opportunities. We set up a structure that gives our clients unparalled access to counsel, resulting in frequent contact and quick turn around times.
Lastly, clients need a wide-ranging set of expertise to meet a host of legal needs beyond that of the business generalist attorney. While the traditional firms mitigate this by adding full-time specialists in areas like employment, real estate, and intellectual property (thus resulting in higher overhead, and usually higher rates), we’ve chosen a different route, creating a model of legal alliance of the best experts in these areas—special teams, if you will—collaborating with our firm as general counsel. You should only pay for thos specialists when you need them.
Ultimately, this all adds up to 1+1=3. When the lead business attorney makes his or her case as the go-to legal solutions provider with a highly attentive, responsive, billing-predictable approach, it makes him or her a better collaborator within the business. It’s an almost seamless relationship dynamic that looks, feels, and acts like in-house corporate counsel for companies that either can’t yet afford such a resource full-time, or, for even better reasons, choose a streamlined approach to business undertakings and fit the business/attorney relationship into that thinking.
The beauty of this model is that it is entirely adaptable to scale, from companies of one to companies of many, and we will keep evolving it in more client-centric ways.