Saturday, November 24, 2012
Law firm consolidations are in the air. Over the last couple of weeks, two major Canadian law firms have entered into combination agreements with U.S./UK counterparts.
- Norton Rose (a British firm with a major Canadian presence) is merging with Fulbright & Jaworski, creating a firm with 55 offices and 3,800 lawyers. Details here.
- Fraser Milner Casgrain is combining with SNR Denton (US-UK firm that swallowed up the legacy Sonnenschein law firm in 2010) and Salans, which is a European law firm original formed in France. The resulting firm will have 2500 lawyers in 79 offices and 52 countries worldwide. Details here.
In the video interview below, Jordan Furlong, a Canadian lawyer, journalist and consultant (Law21), views these developments as the beginning of a major sea change.
To my mind, the consolidations we are witnessing have a lot to do with flat worldwide revenues. Law firms become uncomfortable places when they are not growing. Yet, really big law firms seldom fail because failure requires that a large number of partners vote their feet. A 30-partner defection can be a lethal blow to a 500-lawyer firm, but not so much for a 2,500-lawyer firm. The larger number of lawyers provides managers with more time and latitude to figure out a longer term strategy. Big feels safer. Further, once the consolidation is complete, the firm managers can thin the ranks of weaker partners, producing a stronger overall firm. (That is the theory, anyway.)
[Posted by Bill Henderson]
Friday, November 23, 2012
Some people believe that we shouldn’t be training our future lawyers to be entrepreneurs or that it isn’t necessary or perhaps even desirable. These people see lawyers and entrepreneurs as “strange bedfellows”. These people smirk at Richard Susskind’s book, the End of Lawyers?. They smirk – not because they don’t see the question mark – but instead, because the question itself is a non sequitur – “The End of Lawyers (That’ll Be The The Day)”. They know that it is not the end of lawyers nor will there ever be an end of lawyers. They know that the legal rebels and law disruptors and the big-bad-non-lawyers are NOT going to take over the law market. They know that law firms and law partners and law schools and law deans and law professors will survive.
And they are likely right.
But what they may not foresee is that the ones left standing (the lawyers, and the law firms and the lawschools and the law deans and law professors that will be left standing) will be those that no longer use the capital “I” that resides in “me, myself, and I” that has so long plagued our profession and that is based on Individual lawyers and Individual clients and Individual law school education that inhibits collaboration with nonlawyers. and that is at the heart of how most law firms and law faculties have organized themselves (see SlideShow making these points).
Instead, those left standing will be those that move the capital “I” from a place that has historically kept the legal profession in a closed environment, to a place where there is “Interaction” with non-lawyers, “Interdisciplinary” collaboration “Inter-department” education, and, above all, “Innovation.” Those left standing may not all be legal entrepreneurs but they most certainly will be Intrapreneurs.
“Smart organizations will seek out individuals who like to invent, innovate and want to be on the front lines of change. These individuals can work independently but even more important can work seamlessly as part of an integrated team structure and also effectively embrace and embody the culture of the intrapreneur’s host organization.”So although it is true that these new entreprenurial focused law ventures are made up of many legal rebels and law disrupters and legal entrepreneurs, and that they attempt to instill an entrepreneurial spirit in all that participate. More than that, they represent a community of lawyers that believe in the Intrapreneur in us all, the ability to exapt ideas from other places in order to affect change (see Article on the need for exaptation in the law market). They believe in those that use the capital "I" to replace the E in Entrepreneur. They believe that it is not just the Entrepreneurs but also the Intrepreneurs in law that will be left standing.
Those that continue to use the capital "I" as in "me myself and I" (and refuse to change) will be those that, like the cheese, stand alone.
Wednesday, November 21, 2012
From far away, knowledge workers in India appear to be a formidable and growing threat to American college graduates. But according to Mohit Chandra's essay, "An Open Letter to India's Graduating Classes," which appeared in the India Ink section of the NY Time/International Herald Tribune, the current generation of Indian university and professional school graduates is hindered by a serious skills and values gap. Indeed, the author, a partner at KPMG in Delhi, chastises the newly minted 2012 graduates for being spoiled and behaving unprofessionally.
There are two crosscurrents at work here that are quite difficult to untangle: (1) the process of globalization, which is linking together the economies--and thus the cultures--of India and the U.S.; and (2) workplace generational frictions, which apparently are just as vexing in India as they are in the U.S. As a mid-career Indian professional with an MBA from Ohio State and a work history that includes KPMG, Capital One, McKinsey & Company, and Ernst & Young, Chandra sits on top of both of these faultlines.
I think Americans might be surprised by both the content and tone of Chandra's letter, which cannot be judged by western standards. The letter reveals as much about the U.S., and humanity, as it does about India. Quite a read.
Dear Graduates and Post-Graduates,
This is your new employer. We are an Indian company, a bank, a consulting firm, a multinational corporation, a public sector utility and everything in between. We are the givers of your paycheck, of the brand name you covet, of the references you will rely on for years to come and of the training that will shape your professional path.
Millions of you have recently graduated or will graduate over the next few weeks. Many of you are probably feeling quite proud – you’ve landed your first job, discussions around salaries and job titles are over, and you’re ready to contribute.
Life is good – except that it’s not. Not for us, your employers, at least. Most of your contributions will be substandard and lack ambition, frustrating and of limited productivity. We are gearing ourselves up for broken promises and unmet expectations. Sorry to be the messenger of bad news.
Today, we regret to inform you that you are spoiled. You are spoiled by the “India growth story”; by an illusion that the Indian education system is capable of producing the talent that we, your companies, most crave; by the imbalance of demand and supply for real talent; by the deceleration of economic growth in the mature West; and by the law of large numbers in India, which creates pockets of highly skilled people who are justly feted but ultimately make up less than 10 percent of all of you.
So why this letter, and why should you read on? Well, because based on collective experience of hiring and developing young people like you over the years, some truths have become apparent. ...
There are five key attributes employers typically seek and, in fact, will value more and more in the future. Unfortunately, these are often lacking in you and your colleagues.
1.You speak and write English fluently: We know this is rarely the case. Even graduates from better-known institutions can be hard to understand.
Exhibit No. 1: Below is an actual excerpt from a résumé we received from a “highly qualified and educated” person. This is the applicant’s “objective statement:”
“To be a part of an organization wherein I could cherish my erudite dexterity to learn the nitigrities of consulting”
Huh? Anyone know what that means? We certainly don’t.
Monday, November 19, 2012
Law schools care deeply about their academic reputation. If this were not true, my Indiana Law mailbox would not be stuffed full with glossy brochures sharing the news of faculty publications, impressive new hires, areas of concentration, and sundry distinguished speaker series, etc.
Because of the timing of these mailings – I got nearly 100 in Sept and October—I am guessing that the senders hoped to influence the annual U.S. News & World Report Academic Reputation survey. Cf. Michael Sauder & Wendy Espeland, Fear of Falling: The Effects of U.S. News & World Report Rankings on U.S. Law Schools 1 (Oct 2007) (reporting "increases in marketing expenditures aimed toward raising reputation scores in the USN survey"). But does it work? A recent study by Larry Cunningham (St. Johns Law) suggests that the effect is, at best, decimal dust.
Glossy brochures may not reliably affect Academic Reputation, but I have uncovered four factors that are associated with statistically significant increases and decreases of USN Academic Reputation. To illustrate, consider the scatterplot below, which plots the 1993 ordinal rank of USN Academic Reputation against the 2012 ordinal rank [click on to enlarge].
Four sets of dot (Red, Blue, Orange, and Green), each representing distinctive shared features of law schools, tend to be above or below the regression line. These patterns suggest that changes in USN Academic Reputation over time are probably not the result of random chance. But we will get to the significance of the Red, Blue, Orange, and Green dots soon enough.
The primary takeaway from the above scatterplot is that 2012 USN Academic Reputation is overwhelmingly a function of 1993 USN Academic Reputation. Over 88% of the variation is explained by a school's starting point 20 years earlier. Part of this lock-in effect may be lateral mobility. That is, there are perks at higher ranked schools: they tend to pay more; the teaching loads are lighter; and the prestige is greater, etc. So school-level reputations rarely change, just the work addresses of the most productive scholars. This is, perhaps, the most charitable way to explain the enormous stickiness of USN Academic Reputation.
That said, the scatterplot does not show a perfect correlation; slightly less than 12% of the variation is still in play to be explained by influences other than starting position. A small handful of schools have made progress over these 20 years (these are the schools above the regression line), and a handful have fallen backwards (those below the line).
The Red circles, Blue rectangles, Orange diamonds, and Green circles represent four law school-level attributes. The Reds have been big gainers in reputation, and so have the Blues. In contrast, the Oranges have all experienced big declines; and as as a group, so have the Greens. When the attributes of the Red, Blue, Orange, and Green Schools are factored into the regression, all four are statistically signficant (Red, p =.000; Blue, p = .001; Orange, p = .012; Green, p = .000) and the explained variation increases 4% to 92.3%. As far as linear models goes, this is quite an impressive result.
Before you look below the fold for answers, any guesses on what is driving the Red and Blue successes and Orange and Green setbacks?