I recently had the honour to interview Jordan Furlong, an author, a speaker and a leading analyst of the global legal market who forecasts the impact of changing market conditions on lawyers and law firms. Over the past several years, he has given presentations to audiences throughout the United States, Canada, Europe, and Australia, including to law firms, state bars, courts, and many legal associations. He is a Fellow of the College of Law Practice Management and a member of the Advisory Board of the American Bar Association’s Center for Innovation. Jordan has also authored several books and white papers that analyse the rapidly evolving legal market.
Q: Our readers would be keen to know about your journey from choosing law as a profession to one of the foremost analysts and forecaster of the global legal market. Could you please tell us about that?
Well, I can’t speak to whether that’s the destination I’ve arrived at, but I can certainly describe how the journey began! I graduated from law school here in Canada in 1993 and did my “articling year” (a mandatory one-year apprenticeship under a practising lawyer) at a large national law firm. It soon became clear (sooner to the firm than to me) that I wasn’t a great fit for the practice of law, and after a while, I made my way into legal journalism, where I eventually spent 13 years, 11 of them as editor of three national legal periodicals.
During this time, I became interested in the business of law, and specifically why it was a business that seemed to leave most everyone involved with it — not just clients, but also lawyers — dissatisfied and unhappy. I eventually started a blog (law21.ca) where I chronicled not just the problems with the legal business, but also some major changes I could see taking shape. As those changes accelerated, it became clear to me that fundamental shifts were occurring in the relationship between the buyers of legal services (clients) and the sellers (traditionally lawyers, but increasingly other providers as well).
The culmination of these efforts was that I moved into a role, starting in 2010, as a full-time speaker, writer, and consultant, and I chose the term “legal market analyst” to describe best what I did. Today, I speak to law firms, legal associations, and many other groups and entities within the legal system about the nature of market change and where more changes of this type will take us in future. And I offer recommendations and solutions for what lawyers and law firms should do to prepare for that future.
Q: Tell us about the idea and the motivation behind your book- Law Is A Buyer’s Market: Building a Client-First Law Firm
The motivation for my book, principally, was to gather in one place, under a cohesive narrative, my assessment of change in the market and my recommendations for how lawyers and law firms should respond and adapt to those changes. There are many more voices taking part in this conversation now than there were in 2010, but it seemed to me that most lawyers and firms are still largely unaware of the freight train bearing down on them, and I thought it might be helpful if I least shouted “Look out!” in book form. :-)
But the fundamental idea behind the book is that lawyers and law firms should not and need not sit back and wait for the train to hit them. There are myriad steps and efforts law firms can undertake to respond to market change, and there’s no shortage of information and blueprints available with which firms can chart a course out of danger and towards a very successful future. I want to see law firms evolve and I want to see lawyers survive; the legal market would be poorly served, to put it mildly, if the legal profession weren’t part of its future. We need lawyers as a society, and it’s important that lawyers have sturdy, modern, reliable platforms from which they can provide their services.
Q: What are the major challenges faced by law firms today and how these challenges can be addressed to build a sustainable law practice?
The fundamental challenge faced by law firms today is that the demand side of the market has become rapidly and forcefully empowered, and the supply side hasn’t fully come to grips with this yet.
- Clients have access to reliable legal information and resources that have never been available before, much of which is free or low-cost.
- Clients can collaborate with and learn from each other’s experiences to an extent never before possible.
- Clients can turn to a large and growing array of service providers other than lawyers in law firms, especially in the burgeoning area of cognitive computing and artificial intelligence.
- And clients have a growing ally in legal services regulators, who slowly and perhaps reluctantly but still inevitably are lowering barriers to entry for legal services suppliers
Clients are very quickly closing the power gap with lawyers and restructuring their relationships with legal services providers. Law firms accordingly have competitors (clients would call them “choices”) they’ve never dealt with before and are dealing with buyers whose purchasing behaviours and criteria are vastly different than they were 10 or 15 years ago. Most troubling for law firms, all these market changes have exposed fatal vulnerabilities at the heart of the traditional law firm business model, primarily the inefficiency, wastefulness, and misapprehension of client value that have been the hallmark of that model for decades.
How do law firms respond? By recognising that lawyers still have value in this market, but that the ways in which law firms traditionally have derived and delivered that value to clients are outdated and borderline-obsolete. Firms need new models for the identification of client value and the delivery of legal solutions. They need to re-envision themselves as legal solutions providers and then figure out which of the many useful resources available to provide those solutions — lawyers, paralegals, LPOs, systems, software, etc. — are appropriate and proportional to deliver those services, and in which combination.
The first step in that process, to my mind, is when a law firm recognises and accepts that the real-time involvement of a lawyer is not always, or even usually, the best way to render a solution to a client’s legal need. Once that realisation sets in and is absorbed, the firm can make massive strides in a relatively short space of time. But that realisation is still very difficult for most firms to reach.
Q: Tell us about your views on:
Artificial Intelligence (AI) in Law Firm Marketing
I believe AI will eventually have a huge impact on the delivery of legal services, although we’re still in the very earliest stages of this process. I believe law firm marketing remains an under-appreciated and under-utilised tool for firms to generate more of the right kind of business in their markets. But it’s not fully clear to me yet how these two important tools can work together. I imagine that AI can eventually help firms to market themselves more effectively — but at the moment, too many firms still need to convince their lawyers that marketing is a good thing and that AI is something more interesting than “robot lawyers.” I think both these concepts need to be more fully developed and integrated within law firms before they can properly “team up.”
Billable Hours vs. Flat Fee Structures
Well, there’s reality and there’s perception. The obvious reality is that flat fees are better for both lawyers and clients in all but the most novel and complex legal matters. Better for the client because they promise reliability and are more closely aligned with value, and better for the lawyer because they allow the lawyer to use all these amazing productivity tools to lower their cost of business and improve their profit margins while opening up time for more revenue generation. But most lawyers still see only the downsides of flat fees and shy away from the challenge of truly assessing their value offerings, while too many clients still prefer the familiar billable hour despite its myriad drawbacks. One of these days, perception will give way to reality and the market will be truly transformed. But today, at least, is not that day.
Online Legal Service Providers
What matters, I think, is that these are “legal service providers.” That they’re online makes little difference, except insofar as a virtual platform obviously increases their reach and convenience to clients while lowering their costs. But lawyers and law firms should look past “online” and recognise that these are, for the most part, reliable, competent options for clients to access solutions to their legal needs. Law firms should emulate them where feasible, ally with them where appropriate, and simply buy them out where a value proposition is clear. But ignoring these providers, or denigrating them, is just about the worst thing firms can do. Clients are taking these providers seriously, and that should be all the motivation law firms require to do the same themselves.
Q: One of the vital factors behind a successful law practice is the ability to implement effective business development and marketing strategy. Could you please share with our readers the most underrated and the most overhyped business development and marketing strategies?
Underrated and most effective marketing and business development strategy- Actually talking to clients. Or better yet: talking to clients, then shutting up and listening to what the clients are saying in response. Most law firms’ client intelligence pools are embarrassingly shallow; they don’t know nearly enough about clients’ short- and long-term goals, their purchasing criteria, and the restrictions under which they labour. Law firms don’t know enough about the “user experience” of their firms, what it’s like to actually hire the firm as a “non-lawyer” and have to navigate the process of dealing with the firm. You almost literally cannot talk to your clients too much: ask them about their concerns, their priorities, their ambitions, and their fears. Listen to what they tell you, and listen between the lines for what they actually need but don’t fully realise. There’s enough information in those answers for you to satisfy their needs for years to come.
Overhyped marketing and business development strategy- Entertaining clients. It might be different in India or in other jurisdictions because cultures differ and that’s fine. But to my mind, nothing wastes a firm’s money or a client’s time more than “treating” clients to sporting events, fancy meals, or other expensive perks. Those are the lazy habits of a bygone age. Take all the money your firm currently spends on entertainment and spend it on a one-day, in-depth Value and Strategy Session with your firm’s biggest client, wherein you host industry panels, bring in thought leaders and influencers from the client’s sector, and make your lawyers available for “speed-dating” brainstorming sessions with client representatives. And charge the client zero for it. I can almost guarantee you the returns on that investment of your money will be phenomenally higher.
Q: What will be the top trends in the global legal market for 2017 and 2018?
I tend to think that current trends will largely continue, especially the growing strength and capacity of service providers other than law firms. For the corporate law sector, watch for the growth of “Legal Ops” personnel, who are transforming the ways in which companies perceive and address their legal matters and who will one day be in control of the law firm relationship. For the consumer law sector, watch for the growth of “chatbots” that dispense legal information and sometimes advice, whether or not that information is sound and that advice is wise. Everyone has a smartphone, everyone texts, and everyone has legal issues that they can’t afford to hire a lawyer to resolve. Someone’s going to create a wildly popular Law Chatbot and own this segment of the market, for better or for worse.
Q: What is your message for our readers, especially those who are planning to start private law practice?
Law is a demanding, necessary, and honourable profession, and don’t let anyone tell you otherwise at any stage of your career. Be of service to others, be of value to your clients, be respectful to your colleagues and opponents, and be a pillar of your community.
For far too long, we didn’t talk about the business side of our professional calling. Now, finally, as the legal market becomes more diverse and demanding, we’re seeing sensible business measures applied to the legal profession’s participation in this market. More and more people will talk about these things, and lawyers and firms will get the message and re-engineer themselves accordingly.
So my concern, in light of this shift, is now that we will stop talking about the professional side of our business. Lawyers offer a unique combination of ethics and expertise, precision and professionalism, that not every other new provider in this market will offer. We will be pressured to take shortcuts, whittle down our ethical commitments, and “be more like the competition” in negative rather than positive ways. But it is possible to offer legal services in both a professional and a businesslike manner. It is, in fact, necessary, for the continued presence of lawyers in the law and in society, that the legal profession keeps these two forces in balance.
That’s why I constantly return to the theme of service. Service is a cornerstone of both a good professional and a good businessperson. Devote your calling and your practice to the service of others, and I promise you will prosper in the new legal market.