Sunday, October 27, 2013
There is an interesting article in The Times of India business section that says, essentially, large Indian corporations are realizing that legal strategy and compliance are too important to not elevate these functions to the C-Suite. As a result, the pay, influence, and prestige of in-house positions in India are now very much on the rise.
This is the same evolution that has occured in the U.S. over the last two to three decades, albeit the evolution appears to be occuring in India at a much faster pace. So any temporal gap in structure is unlikely to be permanent.
This dynamic reminds me of my visit to India in 2009, when Marc Galanter and I spend time with several law firm leaders. One of the most striking features we noticed is that all the name partners were alive and very much in their prime. (In the U.S., the equivalant year would have been roughly 1940.) These lawyers very much enjoyed being engaged on the future of India. And unlike the U.S. or U.K., where the market is now defined by league tables, the topic of money never came up -- granted these Indian lawyers were all making plenty of it.
One of the things most on the minds of the Indian law firm leaders was how they could create a vital, useful organization that would survive them. So, much to our surprise, the India law firm leaders discussed things like Kaplan Balanced Scorecard for determining partner compensation (based on the work HBS Professor Robert Kaplan). Another leading law firm, Nishith Desai, constructed its entire firm based on the best practices of professional services firms worldwide. This was the result of a 20-year reflection on this topic by the firm's founder, who is also still in his prime. See Nishith Desai, Management by Trust in a Democratic Enterprise: A Law Firm Shapes Organizational Behavior to Create Competitive Advantage, Wiley Journal of Global Business and Organizational Excellence, Sept/Oct 2009.
It was almost as if the Indian bar was skipping 100 years of evolution and instead decided to converge immediately on the state of the art. Well, the same may be happening in India legal departments.
Wondering what a Kaplan Balanced Scorecard looks like? Here is a good sample.
Tuesday, October 22, 2013
My colleague and collaborator, Chris Zorn, is teaching a course at Penn State called "Big Data & the the Law." It draws upon several disciplines, including the law. See BDSS. He has been telling me about the crazy creative projects that are taking root in this class, which includes aspiring statisticians, geographers, political scientists, sociologists, public health professionals, and information science folks (alas, no law students, though the course was open to them).
Data visualization is one of the lynchpins of big data interpretation. Below is a very good example. It was generated by Josh Stevens, a grad student at Penn State who is enrolled in the class. I am told this specific work flowed out of the GDELT hackathon hosted by BDSS a few weeks ago. Kind of useful for allocating scarce resources to reduce violent conflict. Uses both time and space. For the full context, see this post.
Sunday, October 20, 2013
I would. The best example of ODR I have come across is Modria, who's tagline is "Any issue, resolved."
Before dismissing Modria as a trivial Internet parlor game, consider this: The technology and process at work here got its start at Paypal and Ebay. Why did Paypal and Ebay become so good at dispute resolution? Because their goal of becoming mega-volume businesses depended on it. If you have millions of transactions daily, a huge volume of low-stakes complaints is inevitable. If dissatisfied customers stay dissatisfied, they don't come back. Worse, they'll talk to their friends.
Now watch is video. Note that the target audience is businesses who (a) feel disputes are a drain on their time and energy, and (b) want happy, loyal customers who vouch for them to friends and family. A prompt, fair resolution to a dispute actually deepens the trust relationship. That's not speculation. That's science. And Modria, and it investors, know that.
In this book, Tommorrow's Lawyers, Richard Susskind talks about ODR as a highly disruptive innovation that will fundamentally alter the legal landscape. It is hard to fully appreciate that claim without seeing concrete example, like the Modria business model, up and running. Many businesses could be drawn to Modria, but so could/would many smaller governmental units. Indeed, several (progressive) county governments have become clients (e.g., on property assessment appeals).
Modria is disruptive because so many forums for resolving disputes, such as courts, repeat-player arbitrations, and various government boards, are not perceived as prompt, fair, and/or just, often times because costs of dispute resolution are so high. So even if the dispute is resolved correctly on the merits--for the subset who can pay the cost--there remains a large residue of dissatisfaction.
This is fundamentally a problem of institutional design. (The ReInvent Law folks understanding this.) The goal, or ought to be, a speedy, low-cost, resolution that is maximizes on the uumber of user who perceived the outcome as fair. Does any state or federal court think this way? In Tomorrow's Lawyers, Susskind asks whether "court is a service or a place" (p. 99). Alas, this is a staggeringly very large market.
Check out the management team of Modia. These folks come primarily from the dispute resolution programs in business and public policy schools. It is worth noting, however, that Modria's Board and its big-time investors include several lawyers, including Jason Mendelsohn, a former lawyer at Cooley who now works as a venture capitalist. Jason has invested in other businesses in the emerging legal vendor space.
Times are changing. And the pace of that change is picking up.
October 20, 2013 in Cross industry comparisons, Current events, Data on the profession, Important research, Innovations in law, New and Noteworthy, Structural change, Video interviews | Permalink | Comments (4)
Thursday, October 17, 2013
Trends in LSAT Profiles of Applicants and Matriculants
In looking at trends over the last 12 years, there are two relevant time frames due to changes in how LSAC reported data. Between 2002 and 2009, the LSAC’s annual National Decision Profiles were based on the average LSAT scores of applicants and matriculants. From 2010 to the present, the National Decision Profiles were based on the highest LSAT scores of applicants and matriculants. This post compares trends in LSAT profiles between 2002 and 2009 with trends between 2010 and 2013, noting that the latter period not only has seen a decline in enrollment but also has seen a significant weakening of the overall LSAT profile of first-years.
Changes in LSAT Profiles from 2002-2009 Using Average LSAT
The following chart shows the difference in LSAT composition of first-years in three cycles between 2001-02 and 2008-09.
Matriculants by LSAT Category (Reflecting Average LSAT) 2002-2009
165+ 150-164 <150 Total
2001-02 5,889 30,100 9,097 45,086
2004-05 7,447 32,007 6,036 45,490
2008-09 7,652 31,991 8,943 48,586
In the three years between 2002 and 2005, applications grew by roughly 5,000, to roughly 95,000, with growth among those with an average LSAT of 165+ and an average LSAT of 150-164, and a modest decline among those with an average LSAT of <150. Law schools matriculated only 400 more first-years in 2005 than in 2002, but there were roughly 3,050 fewer first-year students with average LSATs <150, with 1,900 more first years with average LSATs of 150-164 and roughly 1,550 more with average LSATs of 165+. This three-year period saw strengthening of the LSAT profile of first-year students.
Four years later, with an applicant pool that had declined to nearly 87,000, however, law schools enrolled over 3,000 additional first-year students, 2,900 of whom had average LSATs of <150. Virtually all of the growth in first-years between 2005 and 2009, therefore, was comprised of students at the lower end of the LSAT profile.
Nonetheless, in comparison with the 2002 first-years, the 2009 first-years included slightly fewer students with an average LSAT of <150 (down 154 – 1.7%) and larger populations of students with average LSATs of 165+ (up 1,763 – nearly 30% more) and with average LSATs of 150-164 (up 1,891 – or roughly 6.3% more). In 2009, therefore, the average LSAT profile of all first-years, while less robust than in 2005, was still more robust than in 2002.
Between 2004 and 2008, the ABA approved nine new law schools (with fall 2009 first-year enrollment in parentheses) – Atlanta’s John Marshall (211) and Western State (188) in 2005, Liberty (119), Faulkner (150) and Charleston (241) in 2006, Phoenix (272) in 2007, and Elon (121), Drexel (156) and Charlotte (276) in 2008. The first-year enrollment of these nine schools in Fall 2009 totaled 1,734, roughly 60% of the growth in matriculants with average LSATs of < 150 between 2005 and 2009. While many of the first-year students at these schools had LSATs of greater than 150, these schools took students who might have gone to other schools and increased the overall demand for applicants with average LSATs of <150.
Changes in LSAT Profiles from 2010-2013
The following chart focuses on the last three admissions cycles and the current admission cycle, covering the period in which the LSAC National Decision Profiles were based on each applicant’s highest LSAT score.
Applicants and Matriculants Across Three LSAT Categories Based on Highest LSAT from 2010 to 2013
Adm. Cycle Total Total Apps. Mat. Apps. Mat. Apps. Mat.
Apps. Mat.* 165+ 165+ 150-164 150-164 <150 <150
Fall 2010 87912 49719 12177 9477 47722 32862 26548 7013
Fall 2011 78474 45616 11190 8952 41435 29220 24396 7101
Fall 2012 67925 41422 9196 7571 34653 25425 22089 7906
Fall 2013** 59426 38900 7496 6300 30263 24000 20569 8200
*Note that the total matriculants number is greater than the sum of the matriculants across the three categories in any given year because the total matriculants number includes non-standard test-takers and those without an LSAT.
**The Fall 2013 numbers represent estimates based on the number of applicants in each category and an assumption that 2013 saw another slight increase in the percentage of applicants from each LSAT category who matriculated (consistent with increases in the two previous years in response to the decreasing applicant pool).
During this period, the number of applicants declined by 28,000, or over 32%, but the number of applicants with a highest LSAT of 165+ declined by 38%, and the number with a highest LSAT of 150-164 declined by 36.5%, while the number with a highest LSAT of <150 declined by only 22.5%. Thus, the pool of applicants is not only smaller in the 2012-13 admissions cycle as compared to 2009-10, but it is “weaker” in terms of the LSAT profile.
The number of matriculants in the top two LSAT categories also declined significantly between Fall 2010 and Fall 2012, while the number of matriculants in the bottom LSAT category actually grew.
The number of matriculants whose highest LSAT score was 165+ fell from 9,477 in 2010 to 7,571 in 2012, a decline of over 20%, while the percentage of applicants in this category who became matriculants increased from 78% to 80% to 82% over that period. If we estimate that 84% of the 2013 applicants with a highest LSAT of 165+ matriculate, then we can anticipate roughly 6300 matriculants for Fall 2013 with a highest LSAT of 165+, a drop of nearly 33% since 2010.
The number of matriculants whose highest LSAT score was 150-164 fell from 32,862 in 2010 to 25,425 in 2012, a decline of nearly 23%, while the percentage of applicants in this category who became matriculants increased from 69% to 70.5% to 73% over that period. If we estimate that roughly 79% of the applicants with a highest LSAT of 150-164 matriculate, then we can anticipate roughly 24,000 matriculants for Fall 2013 with an LSAT of 150-164, a decline of roughly 27% since Fall 2010.
Meanwhile, the number of matriculants whose highest LSAT score was <150 grew from roughly 7,000 to over 7,900, an increase of roughly 13%, while the percentage of applicants in this category who became matriculants increased from 26% to 29% to 36% over that period. If we estimate that roughly 40% of the applicants with a highest LSAT of <150 matriculate, then we can anticipate roughly 8,200 matriculants with an LSAT of <150 for Fall 2013, an increase of roughly 17% since Fall 2010.
Percentage of First-Years from Each LSAT Category Using Highest LSAT-- 2010-2013*
165+ 150-164 <150
2010 0.191 0.661 0.141
2011 0.196 0.641 0.156
2012 0.183 0.614 0.191
2013 0.162 0.617 0.211
*The sum of the percentages in any given year will be slightly less than 1.00 because the denominator -- total matriculants -- includes matriculants with non-standard LSAT and those with no LSAT.
This table shows that if my estimates for 2013 are roughly accurate, while the percentage of matriculants whose highest LSAT score was 165+ in the first-year class has declined between Fall 2010 and Fall 2013 by roughly 16% (from 19% to 16%) and the percentage of matriculants whose highest LSAT was 150-164 has declined by roughly 6% (from 66% to 62%) the percentage of matriculants whose highest LSAT was <150 has increased 50% (from 14% to 21%).
Adjusting from Highest LSAT to Average LSAT to Compare 2002 and 2013
The change in the 2009-10 admissions cycle to using highest LSAT rather than average LSAT resulted in an increase in matriculants with scores of 165+ of roughly 1,800 between Fall 2009 and Fall 2010. Given that there had been a modest increase in the number of matriculants with an average LSAT of 165+ between 2008 and 2009 (an increase of roughly 600, from 7,023 to 7,652), it might be fair to assume that there would have been another modest increase in the number of matriculants with an average LSAT of 165+ between 2009 and 2010 given the challenging economic environment at the time and the continued growth in applications between 2009 and 2010. Assume then that of the 1,800 additional matriculants with scores of 165+, 400 would have been included in the category if we were still using an average LSAT of 165+ rather than the highest LSAT of 165+. That would suggest that to estimate the number of matriculants with an average LSAT of 165+ in 2010, it might make sense to subtract 1,400 matriculants from the number of matriculants with a highest LSAT of 165+ in 2010 and then for the next three years apply the same percentage reduction as reflected in the number of those with a highest LSAT of 165+ over those three years.
The change to highest LSAT rather than average LSAT also resulted in a drop in the number of matriculants with an LSAT <150 between 2009 and 2010 of roughly 1,900 matriculants. Notably, the number of applicants and matriculants with an average LSAT <150 had grown slightly between 2007 and 2009 (applicants from 29,123 to 29,926, matriculants from 7,013 to 7,906). Nonetheless, to err on the conservative side, assume that the number of matriculants with an average LSAT <150 actually may have declined in Fall 2010 from Fall 2009 rather than continuing to increase modestly. Assume it would have declined by roughly 5% or 400 (rather than 1,900). That would mean that to estimate the number of matriculants with an average LSAT of <150 in Fall 2010, we would need to add to the number with a highest LSAT of <150 roughly 1,500 more matriculants and then for the next three years apply the same percentage increase as reflected in the number of those with a highest LSAT of <150 over those three years.
Using these assumptions, the estimated number of first-years with an average LSAT of 165+ would fall to roughly 5,400 as of Fall 2013, while the estimated number of first-years with an average LSAT of <150 would rise to over 9,800 in Fall 2013.
If the estimates above are close to accurate, then the number of Fall 2013 matriculants with an average LSAT score of 165+ represents roughly 14% of Fall 2013 matriculants (a slightly higher percentage than in Fall 2002), while the number of Fall 2013 matriculants with an average LSAT of <150 represents over 25% of Fall 2013 matriculants (a much higher percentage than in Fall 2002). The following chart shows the percentage of matriculants for the period from 2002-2013 taking into account the estimates set forth in the preceding paragraph regarding the number of matriculants with an average LSAT in each range over the period from 2010-2013.
This graph shows that the percentage of matriculants with an average LSAT of 165+ has varied between roughly 13% and roughly 17% percent over the period from 2002-2013, and appears to have returned in Fall 2013 to a percentage only slightly higher than where it was in Fall 2002. By contrast, this chart also shows that the percentage of matriculants with an average LSAT of <150 had varied between roughly 19% and roughly 13% until the Fall 2012 and Fall 2013 groups of matriculants, when the percentages increased to roughly 22% (in 2012) and over 25% (in 2013). While this graph does not include the percentage of matriculants with average LSATs of 150-164, one can infer that percentage as the difference between 100% and the sum of the 165+ percentage and the <150 percentage. For the period between 2002 and 2011, this generally hovered between 65% and 70%, but in the last two years it has fallen closer to 60%.
This shift in LSAT profile is further evidenced by changes in LSAT profiles among first-year entering classes between 2010 and 2013. For Fall 2010, there were only nine law schools with a median LSAT of 149 or lower (using highest LSAT for reporting purposes). For Fall 2011, there were 14 law schools with a median LSAT of 149 or lower. For Fall 2012, there were 21 law schools with a median LSAT of 149 or lower. That number may grow to nearly 30 when official data is published next spring on the Fall 2013 entering class.
If one uses the LSAT profile as an indicator of the “strength” of a given class of first-year students, and uses the framework set forth above for looking at the LSAT profile, then in the last three years we not only have seen first-year enrollment shrink by roughly 10,000 students, but also have seen a significant “weakening” of the LSAT profile. In terms of LSAT profile, the Fall 2013 entering class is almost certainly the weakest of any class going back to Fall 2002. This may impact the classroom experience at some law schools and may impact bar passage results when the Fall 2013 entering class graduates in 2016.
Why the Differential Response to Market Signals by Different Populations of Prospective Law Students?
What might explain the extent to which different populations of prospective law students have responded to market signals in such different ways, with those from elite college and universities and those with higher LSATs turning away from law school more than those from less elite colleges and universities and those with lower LSATs? In Part Three I will explore some possible explanations.
That is the message of Larry Richards, a JD-PhD consultant who runs a company called Lawyer Brain. At the 18th Annual Law Firm Leaders Group Conference here in NYC, Larry made this point with the video below. Very effective.
Five years ago, Larry told me to read Daniel Pink's book, A Whole New Mind. (Daniel Pink, by the way, is a lawyer by training.) The message of that book is developing the right side of brain (emotive, aesthetic, storytelling) with our left side (analytical, quantitative). That was very good advice. Thanks, Larry!
Tuesday, October 15, 2013
Below is job posting for a new type of job called a "legal solutions architect."
The job post just appeared on the website of Seyfarth Shaw, a large law firm based in Chicago. Seyfarth was one of the first to embrace the movement toward technology and process. See Six Sigma at Seyfarth Shaw, Legal Professions Blog, April 14, 2010.
Before getting to the text of the ad, a few of observations for what this posting is telling us about legal education and the emerging legal job market:
- This is a pure JD advantaged job. "Juris Doctor or MBA with legal industry experience strongly preferred job" (emphasis in original). It is full-time, long-term job in downtown Chicago. it is not reviewing documents. This is a good professional job doing very sophisticated and challenging work.
- The job is not partner-track. But it terms of economic potential and job security, does that matter? In the years to come, folks that understand the overlay between law, technology, and process are going to be great demand and have a lot of options.
- Undergraduate education matters, but the majors are far from typical among traditional law students: finance, business administration, computer science, or "other technical discipline."
- It is easier to get this job if an applicant has familiarity with "extranets, intranets, document assembly, enterprise search, relational databases and workflow." Also, it is "a plus" to have "familiarity with Agile and Scrum [two software development tools]." We don't teach any of this stuff in law school. Perhaps we should.
- The required skills are an blend of technical skills and knowledge plus higher order professional abilities that, frankly, are not explicitly taught in law school. Law schools need to take notice, as this an order any decent professional school should be able to fill.
Now the actual job posting:
Legal Solutions Architect
Seyfarth Shaw is one of the most progressive, forward-thinking law firms in the world. Seyfarth’s commitment to delivering legal services in a new way through its SeyfarthLean program - with an emphasis on value and continuous improvement - has been praised by the Association of Corporate Counsel (ACC) as being “five years ahead of every other AmLaw 200 firm.”
Legal Solutions Architects anticipate, identify, sell and drive innovative business solutions. Through an understanding of technology, knowledge management, business analysis, process improvement and project management, this role provides solutions that enhance the client experience. These multidisciplinary resources are aligned with Firm strategy and play an important role in driving the Firm’s innovative approach to the practice of law and the delivery of legal services.
This position will report to the Director of the Legal Technology Innovations Office. Seyfarth Shaw recently received awards for 2013 Innovative Law Firm of the Year and Innovative Project of the Year, and the efforts of the Legal Technology Innovations Office played a significant role in earning those recognitions.
- Partner with clients, Seyfarth legal teams and legal project managers to enhance the delivery and effectiveness of services provided within legal engagements
- Translate stated and inferred needs of clients and attorneys into specific technologies and methods
- Synthesize the needs of multiple engagements and create requirements for systematic solutions that underpin Seyfarth’s varied legal practices
- Team with the Application Development Group to design and plan for custom solutions and oversee the construction and implementation of these systems
- Manage multiple projects concurrently, juggling priorities, deadlines and essential duties for each project
- Collaborate with other Firm departments, including Legal Project Management Office, Practice Management, Finance, Marketing and Professional Development to provide comprehensive solutions
- Act as an effective change manager – keeping client and Firm culture, group behavior and individual habits in mind in order to best circumnavigate roadblocks and pitfalls for solution adoption
- Provide presentations to individuals, small groups and large audiences of clients and Seyfarth attorneys in a persuasive and encouraging manner
- Contribute to continuous improvement, promote the use of technology solutions and help improve the awareness of the impact of the solutions on the business
- Perform vendor due diligence and serve as a point of contact for third-party technologies leveraged by the Firm
- Conduct market, external and internal research and convey results to forward assigned projects and to aid projects lead by teammates, other groups and other departments
- Proactively research and maintain knowledge of emerging technologies and service delivery models and possible applications to the business
- Highly motivated self-starter with an entrepreneurial bent
- Uses intelligence, creativity and persistence to solve varied, non-routine problems
- Possesses an understanding of knowledge management, process improvement and legal project management and an appreciation of the benefits to law firms employing these approaches
- Passion for legal technology, including technical platforms, specific technical applications and their impact on the practice of law
- Keen grasp of project management, flexible in project execution and able to meet aggressive deadlines
- Strong business analysis approach
- Visualizes how raw data can be converted into useful information for client and Firm decision-makers
- Pays attention to detail but still maintains focus on the bigger picture
- Comfortable working both independently and in diverse teams
- Excellent written and verbal communicator that is able to distill complex concepts into simple messages
- Familiar with the software development cycle
- Capable of managing and motivating up, down and across the organization
- Appreciation for user interface and user experience design
- Embraces change and seeks to create order from chaos
- Bachelor’s degree, preferably in finance, business administration, computer science or other technical discipline
- Juris Doctor or MBA with legal industry experience strongly
- Experience working within a large law firm preferred but not required
- Familiarity with extranets, intranets, document assembly, enterprise search, relational databases and workflow preferred
- Familiarity with Agile and Scrum a plus
Seyfarth Shaw is committed to working with and providing reasonable accommodation to individuals with disabilities. If, because of a medical condition or disability, you need a reasonable accommodation for any part of the employment process, please call (312) 460-6545 and let us know the nature of your request and your contact information. We offer an outstanding benefit package which includes: medical/dental, 401k with employer contribution; life insurance; transportation fringe benefit program; generous paid time off policy; and long-term and short-term disability policies. Equal Opportunity Employer M/F/D/V
Sunday, October 13, 2013
General counsel from large legal departments are becoming increasingly skeptical of the value provided by leading brand-name law firms, such as the AmLaw 20 or the Magic Circle. That is the conclusion of some compelling research just posted on the HBR Blog Network, the online idea forum run by Harvard Business Review.
The research was conducted by AdvanceLaw, which is a company that vets law firms and lawyers on an as-requested basis on behalf of legal departments. Some of AdvanceLaw's clients include Google, Nike, Sherwin-Williams, Lenovo, Towers Watson, Mastercard, Panasonic, eBay, Mastercard, Deutsche Bank, McDonald's, Molson Coors, Nestle, Heinz, Clorox, Unilever, CSS, Starwood Hotels, etc.
AdvanceLaw is a good example of what Richard Susskind calls a "closed legal community." See Tomorrow's Lawyers, chapter 5. Some essential background on AdvanceLaw is discussed below. But I am sure readers want to see the data first. The reported research was based on responses from 88 general counsel, who answered two questions:
- How does law firm pedigree affect their buy decision for a high-stakes matter?
- Is law firm pedigree associated with more or less client responsiveness?
Below are the results posted on the HBR Blog Network:
Readers are probably wondering, "Who is AdvanceLaw and why are they asking these types of questions?" I have some intel on this topic.
AdvanceLaw was formed four years ago by Firoz Dattu, a Harvard-trained lawyer who spent time in BigLaw (Paul Weiss). Firoz eventually found his way to the Corporate Executive Board, which a publicly traded company (NYSE: CEB) that specializes in subscription-based research organized by industry and function. CEB uses the aggregated research for value-add services such as benchmarking and best practices.
Because they specialize in factgathering for strategy and management, CEB has a long history of employees leaving to start niche businesses. That is what happened here. Firoz helped launch, and ultimately ran, the General Counsel Roundtable (GCR), which is a CEB functional group that cuts across industries. I have been to a GCR meeting (it is invitation-only for outsiders). Suffice to say that a persistent theme of conversation was controlling legal costs without compromising quality. A seemingly tall order, right?
Firoz started AdvanceLaw because of perceptions by general counsel that they were being overcharged and underserved by large firms in the major markets. Any GC who has reviewed data from TyMetrix would quickly draw the same conclusion, as a large firm lawyer with 20-years experience in, say, Minneapolis often has a lower billing rate than a second-year at a mega-firm in NYC. AdvanceLaw has positioned itself as a trusted advisor that can provide reliable guidance in shopping for value outside the big brand-name firms.
So how does this service work? As noted earlier, AdvanceLaw is an example of a closed legal community. To get into the AdvanceLaw network, prospective law firms are run through a rigorous RFP process that evaluates things like expertise, innovation, quality, compensation systems, and track record on diversity.
If a firm makes the AdvanceLaw cut, they start getting assignments from participating legal departments. But here is the enormous differientator. Feedback is collected by AdvanceLaw and shared with the law firm and other AdvanceLaw legal departments. What is the effect?
- For law firms, changing their behavior to (a) protect their reputations, and (b) get more work.
- For legal departments, to the extent they are getting value, migration of their legal work out of pedigreed law firms in the major markets to lower cost yet high quality regional and super-regional firms. The savings are roughly 30-40% with no loss in quality and better responsiveness. Some of the winners in the AdvanceLaw tournament are listed here.
AdvanceLaw also has a globalization overlay, which has been created with GC assistance. For instance, in Argentina and India, AdvanceLaw works with quite prominent firms who also exhibit efficiency. In the UK and Canada, the firms are substantial players, but are slightly less pedigreed than the Magic Circle and Seven Sisters, respectively.
So let's boil down AdvanceLaw's business model into its simplest terms: It gathers information so they legal departments don't pay excessive prices for the CYA (cover-your-ass) benefits of hiring high-prestige Big Law.
CYA still matters, of course. But through AdvanceLaw, pedigree is being given a more accurate valuation. A likely large second-order effect of AdvanceLaw is the acceleration of AFAs through AdvanceLaw firms, as feedback (on quality) and publicity (to drive volume) is what is needed to make that transition.
Susskind is right. Closed legal communities are going to be major disruptors in the legal marketplace.
Friday, October 11, 2013
Analysis of Differential Declines in Law School Applicants Among Top-240 Feeder Schools
Some people recently have noted the decline in applications to law school from graduates of relatively elite colleges and universities - here and here. This suggests that different populations of potential applicants to law school are responding differently to market signals about the cost of legal education and the diminished employment prospects for law school graduates in recent years.In this blog posting, I analyze the changes in applications among the LSAC's Top 240 Feeder Schools between 2010 and 2012, documenting the extent to which the response to market signals about legal education has been different among graduates of elite colleges and universities when compared with graduates of less elite colleges and universities. In Part Two, I will look at a different set of data regarding changes in LSAT profiles of applicants. In Part Three, I will offer some possible explanations for the different responses to market signals among different groups of applicants.
Between 2010 and 2012, the total number of applicants from the Top 240 Feeder Schools fell from 55,818 to 42,825. In both years, the Top 240 Feeder Schools were responsible for roughly 63% of the total pool of applicants (63.5% of 87,900 in 2010 and 63.1% of 67,900 in 2012). But the decline in applications was not uniform across all of the Top 240 Feeder Schools. There are a few different ways one can look at this information to get a sense of the different responses among different populations of potential applicants.
Differential Declines Among Feeder Schools with Law Schools Ranked in Different Tiers
First, one can look at declines across the Top 240 Feeder Schools that have law schools.
One might surmise that potential applicants who are graduates of colleges and universities with a law school might be particularly well aware of the increasing costs of legal education and the challenging employment environment for recent law school graduates and assume that feeder schools with law schools would generally see similar declines in applications. In fact, however, the percentage decline in applications between 2010 and 2012 varied significantly by the ranking of the law school at the feeder school.
Among feeder schools with law schools ranked between 1-50 in the most recent USNews rankings, the average percentage decline in applicants between Fall 2010 and Fall 2012 was 28.08%. Among feeder schools with law schools ranked between 51-100, the average percentage decline in applicants between Fall 2010 and Fall 2012 was 20.27%. Among feeder schools with law schools ranked between 100-146, the average percentage decline in applicants was 18.14%. But among feeder schools with law schools that are ranked alphabetically, the average percentage decline in applicants was only 3.31%.
Given that most of the top ranked law schools are at colleges and universities that also are considered elite colleges and universities, and most of the alphabetically ranked law schools are at colleges and universities that are not considered elite colleges and universities, this analysis suggests that graduates of elite colleges and universities are responding to the market signals regarding legal education differently than graduates of less elite college and universities. (This may seem particularly paradoxical, given that the percentage decline in applicants generally is greater at colleges and universities with more highly ranked law schools (whose graduates generally experience more promising employment outcomes) while the percentage decline in applicants is lowest at colleges and universities with less highly ranked law schools (whose graduates generally experience less promising employment outcomes.))
Comparisons of Outlier Schools – Those Schools More than One Standard Deviation from the Mean
Second, one can look at “outlier” schools and see how negative outliers compare to positive outliers. The average percentage decline in applicants across the Top 240 Feeder Schools between 2010 and 2012 was 19.76%. The standard deviation was 18.67%. How do those schools more than one standard deviation from the mean compare with each other?
There are a total of 13 schools that saw a decline in applicants between 2010 and 2012 putting them below the mean by more than one standard deviation – schools with a decline in applications greater than 38.44%. There are a total of 26 schools that saw an increase in applications or such a modest decline in applications that their increase/decline was more than one standard deviation above the mean – a decline of less than 1.09% or an increase. How do these schools compare?
Eight of the 13 feeder schools that saw the most significant declines in applications had a law school with an average rank of 69. (These schools include NYU (6), Virginia (7), Cornell (13), George Mason (41), Marquette (94), Akron (119), Loyola (New Orleans) (126), and Univ. of San Fran. (144). Four of the eight were top-50 law schools, while none were alphabetically ranked.)
Thirteen of the 26 feeder schools that saw the least significant declines in applications (or saw increases in applications) had a law school, including four that were ranked alphabetically. Among just the nine law schools in this category that are ranked, the average rank is 104. (These schools include Denver (64), UNLV (68), Loyola (Chicago) (76), Rutgers (91), Florida International (105), Wyoming (113), CUNY (132), Southern Illinois (140), and Suffolk (144), along with Florida A & M, North Carolina Central, Nova Southeastern, and Southern (all alphabetical). Notably, only four of the thirteen were ranked in the top-100 law schools (none in the top-50).)
Again, in this analysis, with a few exceptions, those feeder schools that saw significant declines in applicants generally represent a more elite slice of American colleges and universities, while those with the most nominal declines in applicants (or increases in applicants) generally represent a less elite slice of American colleges and universities.
Outliers More Broadly – Comparing Schools with Declines Greater than 30% and Less than 10%
Third, if one wanted to look at a broader pool of feeder schools at the bottom and the top, one could look at all schools down 30% or more in applicants and all schools that were down 10% or less in applicants between 2010 and 2012 (roughly 10% above and below the mean), two sets that account for nearly half of the Top 240 Feeder Schools.
There were 68 schools down 30% or more in applicants, 46 of which had a law school, of which 29 were ranked in the top-50, with only one school ranked alphabetically. The average rank of the 45 numerically ranked law schools was 48. The other 22 feeder schools in this category include several highly regarded schools – including, for example, Rice, Vassar, Miami University, Brown, Amherst, Johns Hopkins and Princeton.
There were 51 schools with a decrease in applicants of 10% or less, 25 of which had law schools, only two of which were ranked in the top-50, with six schools ranked alphabetically. The average rank of the 19 numerically ranked law schools was 94. The other 26 feeder schools in this category include mostly less elite colleges and universities – including, for example, Kenesaw State University, University of Texas at San Antonio, and Florida Gulf Coast University, along with University of Phoenix and Kaplan University.
All three approaches to analyzing the changes in applicants among the Top-240 Feeder Schools point in the same direction. Graduates of elite colleges and universities are opting not to apply to law school at a greater rate than graduates of less elite colleges and universities. One might suppose that this translates to a greater decline in the number of applicants and matriculants with really high LSATs (165 or above) as compared to those with relatively low LSATs (149 and below). In Part 2, I explore whether this supposition is accurate.
Posted by Jerry Organ
Wednesday, October 2, 2013
Because the U.S. News & World Report ranking era has been associated with so much turmoil and bad behavior, many of us in legal education tend to think of the magazine as the source of woes. In fact, the evidence compiled in an new paper on SSRN, "Enduring Hierarchies in American Legal Education," suggest that our desire (or propensity) to establish a legal education pecking order predates the U.S. News rankings by century or so. Vanity of vanities, all is vanity -- at least that is what the data seem to suggest.
My brilliant and industrious colleagues, Funmi Arewa and Andy Morriss, led the charge on this. For many, a major contribution of this research will be the detailed 40+ tables compiled at the end of the article. Now that all that fact-gathering work is done, others can use it. Below is the paper's abstract:
Although much attention has been paid to U.S. News & World Report’s rankings of U.S. law schools, the hierarchy it describes is a long-standing one rather than a recent innovation. In this Article, we show the presence of a consistent hierarchy of U.S. law schools from the 1930s to the present, provide a categorization of law schools for use in research on trends in legal education, and examine the impact of U.S. News’s introduction of a national, ordinal ranking on this established hierarchy. The Article examines the impact of such hierarchies for a range of decision-making in law school contexts, including the role of hierarchies in promotion, tenure, publication, and admissions, for employers in hiring, and for prospective law students in choosing a law school. This Article concludes with suggestions for ways the legal academy can move beyond existing hierarchies and at the same time address issues of pressing concern in the legal education sector. Finally, the Article provides a categorization of law schools across time that can serve as a basis for future empirical work on trends in legal education and scholarship.
Posted by Bill Henderson
Tuesday, October 1, 2013
The Legal Whiteboard was created to focus on "facts, trends, and ideas on law and legal education." Well, nothing is more salient these days than the rise of the legal tech sector which -- trust me here -- is growing rapidly and will soon hit a tipping point. What happens at the tipping point? The tastes of clients and highly talented workers shift, leaving old institutions very vulnerable.
If you are interested in this topic and want a time-efficient primer, check out this ABA Journal podcast, which went live yesterday. It is 15 minutes long and can be downloaded. Thanks to good questions from ABA editor Reg Davis, and some editing magic, the interview is a pretty good starting place for the uninitiated -- the only downside is that you have to listen to me, as interview keys off the "Who's Eating Law Firms' Lunch" story (Oct ABA Journal).
Our conversation is also transcribed.