Saturday, September 22, 2012

Hilarious Video on the Billable Hour

From our UK colleagues, specifically the lawyers at Riverview Law, which is a new-breed British law firm that does things exclusively on the flat fee model.  Check it out:

Riverview's advantage may be more than its ability to produce funny videos that ricochet into the inboxes of inhouse lawyers. (I was alerted to this video via Twitter from Patrick Lamb, one of the ABA New Normal guys and a principal at Valorem Law, a Chicago-based flat-fee shop.  Pat recieved his link from a client.)

Lawyers from Riverview Law were at the Legal Tech Camp that I have discussed in prior posts (here and here).  To my mind, Riverview's greatest advantage is focus -- they want to do the same work as other corporate law firms at the same quality level or higher, but also at a signficantly lower, fixed fee price.  The firm appears to work backwards from the price to make process-design and sourcing decisions.  The result, plain and simple, is innovation. Long term, that is the only way they can make money. 

Here is how they explain just one of their services, called Legal Advisory Outsourcing -- again, in a well produced video.

If you think Riverview Law is no big deal, this may get your attention.  The flat-fee shop is partially owned by the mega law firm DLA Piper.   Earlier this year, they opend an office in New York City.

[posted by Bill Henderson]

http://lawprofessors.typepad.com/legalwhiteboard/2012/09/hilarious-video-on-the-billable-hour.html

Current events, Data on the profession, Innovations in law, Law Firms, New and Noteworthy, Structural change, Video interviews | Permalink

Comments

Connect the dots between Pat (who is a friend on mine, by the way), Legal Tech Camp and the video. Hint: If this was the new normal, it wouldn't require so many years of such strenuous promotion by so many outliers.

There will be a new normal, but it will grow organically rather than from years of cute videos, boot camps or membership in the futurist cult.

Posted by: shg | Sep 22, 2012 7:46:51 AM

What a lovely reference to "Yes, Minister"! Well done!

Posted by: anonymous | Sep 25, 2012 6:19:44 AM

Funny! But firms have to be very careful with fixed fee arrangements, especially on the accounting side. Did you ever stop to consider what happens to the fixed fee when it is paid? In most fixed-fee arrangements, the fee gets paid up front. From there, the fee gets thrown into the firm's financial pot and what is not used to pay the expenses is distributed as profit. If the money is distributed before the work is done, however, what remains on the books of the firm is a debt, an obligation that must be repaid by working hours for which payment has already been received. Not a big deal if there are only a handful of fixed-fee clients for the firm, but what if the fixed-fee client is a major source of income for the firm? The fixed-fee arrangement will continue to work well so long as there are new legal matters coming into the office that will generate a healthy cash flow. The reality of the fixed-fee arrangement hits home, however, when the major client stops sending new work. At that point, there is no new money coming in the door and the firm's balance sheet has a large debit remaining (unfinished work for which payment has already been received). Firms need to keep this reality in mind when entering fixed-fee arrangements.

Posted by: E. Cooney | Sep 25, 2012 7:04:39 AM

My tax law firm chargs flat fees. Article here:

http://www.irsmedic.com/2012/02/25/tax-lawyer-fees/

Posted by: Anthony E. Parent | Sep 25, 2012 7:36:35 AM

I recommended very similar arrangements to law firms (both large and small) as a prospective business model or as a way to do business with me as GC. The response I would receive often times was strikingly similar to the drunken solicitor in the first video.

I still believe it is a business model that would be especially attractive to mid to small corporations and very profitable to the firm that employs it.

Posted by: tom obrien | Sep 25, 2012 7:47:10 AM

No more billable hour?
Las Vegas is doomed.

Posted by: Flavius Minimus | Sep 25, 2012 8:39:26 AM

The music intro and the dialog sound a lot like those of two of the all-time best British comedy series, "Yes, Minister" and "Yes, Prime Minister". That can't be an accident.

Amazon Instant Video has a lot of the series' episodes. A sample clip from YouTube http://www.youtube.com/watch?v=8keZbZL2ero

Posted by: Nate Whilk | Sep 25, 2012 1:07:11 PM

What does Riverview mean when it uses the term "legal panels?"

The LSA has transformed the UK into a crucible for innovation. Each state in the United States should institute similar regulations. Otherwise, US-based legal service providers will find themselves light years behind their international competitors.

I wonder if any US-based firms with offices in the UK are implementing more innovative models in those offices?

Posted by: B. Peterson | Sep 25, 2012 9:08:47 PM

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