TECHSHOW2018 & the Academic Track = Success! No, it was a Spectacular Success!!!

[Ed. Note: Please welcome guest blogger Michael Robak, Director of the Schoenecker Law Library, Associate Dean and Clinical Professor of Law at the University of St. Thomas (Minneapolis) School of Law. Michael did want me to mention this quote about his enthusiasm in writing this post -“The biggest challenge after success is shutting up about it. (Criss Jami)” - GL ]

It is hard for me to be objective about the first official TECHSHOW Academic Track but, I think, it is fair to say that what transpired was an overwhelming success. And the best part – the Academic Track will be part of TECHSHOW2019--so we need to start planning!

Before I get into more detail about the Track, let me say, TECHSHOW2018 was in and of itself a smashing success. This year saw a new venue with more space and with more attendees. Except for a small glitch with registration on Wednesday (which led to an open bar, so seriously, not a downside at all!), everything worked incredibly well. Co-Chairs Debbie Foster and Tom Mighell, and the TECHSHOW Board and ABA staff, are to be commended for their dedication and diligence in putting together such a terrific TECHSHOW.

But let me get back to the reason for the post, to let the world know the Academic Track was a complete and wonderful success at TECHSHOW2018. My gauge for declaring success has several measures.

First and foremost were the congratulations from the Co-Chairs and Planning Board (including the incoming Chairs) on the rave reviews and accolades they received for the Track programming. And, as a separate measure, the sheer number of academics who attended the show. While I do not have final numbers yet for attendance by institution, I do know this year saw the largest number of law students attending in the history of the show. There were over 100 law students from all over the country (International LLMs as well) and this did not go unnoticed. There was significant comment not only from the show planners but also from the vendors. Another important measure: how pleased Thomson Reuters, our Track sponsor, was with the programming and attendance. Thomson not only generously sponsored the Track, but was there to support us for the entire Track. Another key measure were comments by academic community first-time attendees that were overwhelmingly positive. They indicated the Academic Track and TECHSHOW provided new insights and great opportunities for moving technology education forward.

Perhaps one of the best measures of our success is the amount of press we generated during the show. The Virtual Reality: Opportunities for Teaching and Using it in Law Practice session generated an ABA Journal article and a Canadian Lawyer article. The How Do I Choose? Selecting and Implementing Law Practice Technology session resulted in an ABA Journal article and LexBlog storify. The Lawyer Entrepreneurship: Teaching Lawyers to Innovate and Disrupt session inspired this ABA Journal article. The Planning for the Future: What’s Next in Teaching Technology session occasioned another ABA Journal article. And of course, as CALI’s John Mayer mentioned to me, there were “many happy tweets!”

Numerous people over the last two years contributed to making the Academic Track a success. The key group for this year is Faye Jones (Illinois College of Law), Jenny Wondracek (UNT/ Dallas College of Law), Kris Niedringhaus (Georgia State University College of Law), Jeannette Eicks (Vermont Law School), Elizabeth Farrell Clifford (Florida State University College of Law) and Irene Mo (the first ever ABA Center for Innovation NextGen Fellow ). In addition, ALL the panelists for the Track were outstanding!

Planning for TECHSHOW2019 will begin in a couple of weeks. I am working on developing a TECHSHOW Technology Education Advisory Board and seeking representation from CALI, AALL, AALS, SLA Legal Division, and others to assist with track content development. If Greg’s generosity persists, I will be setting out specific ideas about Technology Education and how an Advisory Board would work in a couple of future posts (and ways to contribute/participate). Hope to see even more people in 2019!

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South By South West Was So Much More Than Music

Q&A after screening of Blindspotting
I am back in my Houston office this week after spending the past week in Austin attending the South By South West (SXSW) event. I have to admit that I don't think I've ever enjoyed a conference more than I enjoyed SXSW. I've always resisted going because I always thought that it was just about the music, and I couldn't imagine paying $900-$1300* for a music conference… especially since you could catch some of the bands playing non-SXSW clubs for free during the week. After attending, I have to admit that I was way too narrow on what SXSW is, and I think I'm going to go again next year because it is a total experience of education and experience.

For those of you unfamiliar with SXSW, there are four tracks to the event:

  1. Educational/Interactive  
  2. Film
  3. Music
  4. Convergence
I think the Film and Music tracks explain themselves. The Interactive and Convergence tracks really focus on the professional development that most of us seek in our conferences. This year, SXSW added a CLE portion to the Convergence track to attract more of us in the legal industry.

There are a couple of "professional" reasons that most of us use to justify why we go to conferences. We typically want to be educated, and we want to network with our peers. I have to admit that I didn't see a lot of legal information professionals at SXSW this year, but I did run into a number of people who are interested in a number of legal, technical, open-access, and other issues who were very interesting to talk to, and who seemed interested in talking and learning from me as well. 

In addition to all the educational and networking experiences, you also get to see a full dose of Austin "Weird." Like these odd looking dogs. (Just kidding...  I know they're baby donkeys.)

Keeping Austin Weird

While attending SXSW I had a chance to sit in and listen to experts discuss aspects of Artificial Intelligence and Machine learning, Bitcoin and crypto-currencies, and how automation is going to either augment or replace humans. That sounds a lot like every legal conference I've attended in the past two years. In addition, I also got to see panels discuss ethical issues surrounding the practice of law, and in depth discussions on licensing and other intellectual property issues surrounding the arts (mostly on film and music focused on the audience attendees.) There were also great programs on how to present data in a "truthful" manner, and a number of topics regarding the current political environment and how that plays out on both the general population and the targeted populations, and how the legal structure is changing and resisting.

As with all conferences, your mileage may very. My conference method is "Think and Discuss Broadly... Apply as Needed to your Specific Situation." In other words, don't try to get the speakers to answer your specific issues. Listen to them and think in broad terms. Think about how they solve problems, and then work out (in your own mind) how that might help you solve your own problems. I cringe whenever I hear someone get up to the microphone and say something like this to the speaker:
Yeah, that's great, but I have a boss who wouldn't allow me to [do the specific thing that the speaker did in her situation], so what can I do to get my boss to..."
That's when I usually lean over to the person sitting next to me and say, "he doesn't need a conference speaker, he needs a consultant."

The value of SXSW isn't the direct application to your specific needs, but rather the introduction of new ideas and concepts which you might be able to tweak in a way that makes sense for your specific needs. With that in mind, I highly recommend attending SXSW if you get a chance.

* I actually got a free Platinum Badge this year because I spoke on a panel for parents of transgender children. Thanks to Lou Weaver at Equality Texas for submitting my name for the meeting and landing me the badge.

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It’s AmLaw Survey Time: Remember to Look Beyond the Numbers

Photo by Kolleen Gladden on Unsplash
[Ed. Note: Today's post comes from guest blogger, Steve Nelson from The McCormick Group. - TB]

Financial results for law firms have been trickling in and, in a couple of weeks, The American Lawyer will publish its rankings of the 100 largest law firms in the U.S.

As usual, firm management, partners and other legal professionals have a tendency to focus on one statistic---profits per partner---as the primary indicator of success or failure of a law firm.  But as has been noted throughout the years, that number is the most susceptible to manipulation, mostly due to who is determined to be an equity partner.  Less discussed are revenue per lawyer and profit margin, both of which are all available from the AmLaw data.  Most observers will assert that those metrics are more reliable indicators of a particular firm’s health than profits per partner.

There’s also a tendency for legal professionals to overlook several other factors that are raised in the financial reports.   Here are a couple of other data points that should be assessed:
  • A firm’s 3-5-year performance, rather than just the comparison of 2016 and 2017.  A single year’s performance can be skewed by such things as contingency fees or the impact of the integration of a merger, so that evaluating on the basis of that year alone can be quite misleading.
  • Situations where profits have increased but revenues have declined.  Those instances often mean that gains in profitability were largely produced through cost-cutting and/or the de-equitization of partners.   While those actions do indicate a firm’s ability and willingness to address difficult expense-related issues and expectations of partners, the latter in particular is a strategy that is unlikely to be repeated in future years.  And, while not the case with well-managed, forward-focused firms, could indicate the extent of a firm’s willingness to support partners’ practices with marketing and other investment. 
The AmLaw reports provide quite a comprehensive picture of the financial performance of large law firms. But too often, the focus is on one imperfect metric. The message is to look beyond the headlines.

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Nothing You Can Say On Diversity

Nothing You Can Say Can Cause Me To Retain You remains among the most important blog posts for understanding the corporate legal market. Mark Hermann, self-styled curmudgeon and then Chief Counsel – Litigation and Global Chief Compliance Officer at Aon, expertly expounds on why he is loath to add new law firms: he already has really good lawyers.

Hermann calculates a 95% probability that new lawyers would be worse than his curated incumbents. I’ll pile on. Even if we are comfortable that new lawyers would be as good as, and possibly better than, our existing lawyers, there is still a strong argument for sticking with known quantities. It is not merely that we know our incumbents, they know us. The ramp-up costs for onboarding new counsel are more than administrative (framework agreements, fee negotiations, data security audits, e-billing setup), they are substantive. Current counsel know our people, personalities, peccadilloes, preferences, procedures, and policies. New, even when it is better, comes at a cost.

A credence-good environment with high switching costs and (the perception of) delicate equilibria is prone to devil-you-know conservatism. This is a recipe for stasis and entropy but not necessarily satisfaction. Not everyone is as happy with their current roster as Hermann. Those who perpetuate the status quo may not necessarily like it. But they perpetuate it all the same.

Which brings us to diversity and alternative appropriate fee arrangement (AFAs). Both issues were litigated decades ago. According to the public pronouncements, diversity and AFAs won on the merits. In-house counsel declared in a loud, clear voice “This is happening.” Then it didn't.

The paltry gains (relative to expectations) should give us pause. The center of gravity of the legal universe shifted in-house. Corporate legal is a buyers’ market. For decades, buyers have been publicly clamoring for change. But diversity and AFAs came at costs in-house counsel were not willing to pay. This (largely) is what transpired:

I’ll tackle diversity this post and AFAs in the next.

Diverse = different than the status quo

In 1999, the Chief Legal Officers from 500 major corporations signed a “Diversity in the Workplace Statement of Principle” that included the pledge:
We expect the law firms which represent our companies to work actively to promote diversity within their work-place. In making our respective decisions concerning selection of outside counsel, we will give significant weight to a firm’s commitment and progress in this area.
The Statement was an activity anchored in ABA Goal IX—"To promote full and equal participation in the legal profession by minorities”—adopted in 1986 and later modified to include women and persons with disabilities. To reinforce that this was not lip service, the 1999 Statement was identified as being More Than Words.

The “more than words” theme was given a signal boost in 2004 by the Association of Corporate Counsel’s promulgation of a Call to Action, which built on the Statement:
In an effort to realize a truly diverse profession and to promote diversity in law firms, we commit to taking action consistent with the referenced Statement. To that end, in addition to our abiding commitment to diversity in our own departments, we pledge that we will make decisions regarding which law firms represent our companies based in significant part on the diversity performance of the firms. We intend to look for opportunities for firms we regularly use which positively distinguish themselves in this area. We further intend to end or limit our relationships with firms whose performance consistently evidences a lack of meaningful interest in being diverse.
We're about to hit the 20th anniversary of the Statement. So how are things?

Do you see the seismic shifts in trajectory in 1999 and 2004 when in-house counsel went beyond words and answered their own call to action to get serious about outside counsel diversity? Me neither.

Law remains the least diverse profession. And, somehow, on closer inspection, the underlying reality is often worse than the data suggests (here, here).

Which is not to deny the steady, if not steep, upward trends. Nor is it to suggest that in-house counsel are all talk. One of the most discordant aspects of diversity efforts is the ease of assembling an all-star team of law departments with serious diversity programs directed at outside counsel (example, example, example, example, example). Yet, in aggregate, inside counsel have done little to move the needle on outside counsel diversity despite their market power and long-standing public commitments.

Diversity is another instance of innovation being slower than our intuitive logic would suggest, especially when we extrapolate from outliers. My observations are hardly original. People much smarter than me have dug into the underlying issues (I’m partial to this series by Macey Russell for IILP). We can point to some bad faith. We can cite some virtue signaling. We can see the explicit effects of implicit bias. But I am drawn to the explanatory power of governance by fiat and preference intensity.

Lawyers believe in words. Words as sword. Words as shield. Words as incantation (even when the original meaning has been lost to time). Lawyers as advocates who speak things into existence. Lawyers as scriveners who wield the binding power of the pen.

Logophilia has its virtues. But, at the extreme, we treat words as self-executing. So let it be written. So let it be done. We issue but do not enforce billing guidelines. We demand but do not pursue innovation, cost containment, efficiency, etc. We declare our commitment to diversity and consider the matter resolved.

Inertia and self-reinforcing structural impediments to change mean that mere words are insufficient to drive diversity at the desired velocity. Action is required. Actions cost—time, sustained attention, uncomfortable conversations, implementation dips, temporary disruptions to a seemingly fragile status quo.

In a vacuum, we can take in-house counsel at their word they would prefer more diversity. We can also observe that no one operates in a vacuum. In our messy reality, with its tradeoffs and resource constraints, most in-house counsel place diversity far enough down their priority list that abstract support results in benign neglect.

Unanimity might even make the situation worse. One critical characteristic of the diversity debate is the frequent absence of debate. Everyone blithely nods their head in agreement. But, returning again to our innovation illusion, consensus can blunt the urgency to act. The shared recognition that an issue should be addressed is easy to confuse for a sense that the issue is being addressed, thereby giving rise to one of the most common collective action problems: free riders.

I'm Back on My Bullshit

Regular readers know I spent several posts poking good-natured fun at law firm marketing bullshit. But they also recall I laid down a marker. I promised to situate bullshit in the inside/outside counsel dynamic rather than take the coward’s way out. I refuse to advance the simplistic premise that stubborn law firms are the sole impediment to innovation in the legal market.

“Value” is a word that is regularly used in service of bullshit. Value-based fees. Value adds. Value services. Value is not itself a bullshit concept. Understanding value is fundamental (as always, read Ken Grady on Lean). But value is, by definition, vague. And vagueness is an invitation to bullshit.
Value depends. Value is contingent on what the customer is willing to pay for. If something does not add value from the customer perspective, it is waste. Value is not what customers say they want. Value is what customers actually buy.

The question: what is in-house counsel willing to pay for?

Consistent with the lawyer theory of value, the modal in-house counsel is willing to pay by the hour for labor from smart (preferably incumbent) lawyers at brand firms working sequentially on discrete matters. Diversity is absent from the answer. So are AFAs. So are innovation, automation, efficiency, analytics, project management, and most everything I spend my time delivering.

It seems I just intimated that most in-house counsel do not value diversity. I wouldn't want to leave any misimpressions. So outright, in technicolor: most in-house counsel do not value diversity.

I have angered more than few in-house counsel with such declarations. They think I am branding them a bad person. I am doing no such thing. I am not saying they are indifferent to diversity, let alone opposed to diversity. Rather, promoting outside counsel diversity comes at a cost they are not willing to pay.

My inflammatory remarks tend to follow brief discussions of what they currently do to promote outside counsel diversity (see Addendum). Most responses boil down to in-house counsel expressing their preference for diversity to incumbent outside counsel, often in easy-to-ignore written form. When I suggest that the available evidence demonstrates words are insufficient and then inquire about their actions (measurement, incentives, enforcement), they get defensive. They passionately explain how very busy they are with high-impact, mission-critical work and how nice it would be if, for once, outside counsel would be ‘proactive.’

My standard retort is that the problem with incentives is that they work. Inside counsel are asking  outside counsel to do what they themselves will not. Outside counsel are equally busy with high-impact, mission-critical work. Outside counsel know they will be held accountable by inside counsel if they miss a single substantive beat. Outside counsel have learned they will not be held accountable (by most clients) for failing to meet vague mandates to be more diverse. Moreover, outside counsel have been subjected to so many toothless proclamations over the years—billing guidelines, budgets, AFAs, LPM, LTA—that, with respect to service delivery, in-house counsel have become the adults in Peanuts: undifferentiated noise.

Can in-house counsel cut through the noise? Absolutely. In raw numbers, many do, including all the commendable outliers I cited above on diversity. Structured dialogue predicated on sustained attention and continuous, measurable improvement can move the needle on just about anything. It is one thing to 'ask' for a diverse team. It is quite another to track who is working on your matters and to constructively engage "with firms whose performance consistently evidences a lack of meaningful interest in being diverse" (as we committed to doing all those years ago).

In a buyers’ market, buyers are the urgency drivers. Being in the driver’s seat is an act of ownership. Only in-house counsel determines what they are willing to pay for.

But how about exceeding expectations? Going above and beyond? Delighting customers? Being that proactive firm that provides in-house counsel both what they need and what they want?

I’ll get to that. Next post on AFAs. Again, we'll talk about offering in-house counsel what they claim to want. Except, of course, I already told you at the beginning: nothing you can say can cause me to retain you.
D. Casey Flaherty is a legal operations consultant and the founder of Procertas. He serves on the advisory board of Nextlaw Labs. He is the author of Unless You Ask: A Guide for Law Departments to Get More from External Relationships, written and published in partnership with the ACC Legal Operations Section, and the Service Delivery Review Primer, written for the Buying Legal Council. Find more of his writing here. Connect with Casey on Twitter and LinkedIn. Or email casey@procertas.com.

Addendum: I am not shy. But, for once, I ran a post by people before publishing. This is one of the rare issues where I worry about being tone deaf. Friends recommended I explain why a Jirish (Jewish/Irish) male is passionate about diversity.

First, while I am passionate about diversity, I submit that my personal preferences are not material to the argument advanced. Herein, my position is premised on an empirical observation, not a normative one. We know what in-house counsel say about diversity. We have the diversity statistics. There is a patent disconnect. It is hard to imagine disagreement on these facts, which makes this a good point of departure for discussing the delta between in-house counsels' words and actions.

As for the passionate part: some of my best friends are.....ok, hear me out. Having diverse family and friends is not license for bad behavior. But "some of my best friends are" is considered a trite excuse precisely because of the relationship between exposure and empathy. Exposure affords no dispensation. But exposure can serve as a cogent explanation for the evolution of attitudes.

My best friends from law school—I've written about Lael and Darth before—are great lawyers and great people. Yet, I've always had an easier time professionally for reasons that are strange until you start to come to terms with the reasons it is common. Among the most insidious aspects of privilege is how invisible it can be to those who enjoy its fruits.

Theirs is not my story to tell. Getting ahead is supposed to be hard. But it is not supposed to be this hard. Lael and Darth have been successful in spite of obstacles I didn't know existed. And they've handled it with class and composure I've never had to muster.

Without their openness, their patience, and the superficial similarities in our starting points (no family money/connections, same law school), I may have gone on being oblivious. I probably would have maintained vaguely progressive attitudes on diversity but been useless as an ally. Diversity would likely not have been an issue on which I expended social capital.

This has been happening more as of late.

Darth recently joined some fellow Biglaw escapees at a NAMWOLF-member, 100% minority-owned firm (Sanders Roberts). In their first month together, he and one of the name partners defensed a verdict in bellwether litigation for a Fortune 10 corporation. These are great lawyers doing great work for huge clients.

So I have been asking my in-house friends and acquaintances how to get Darth in front of whomever oversees litigation. I don't need any more than that. Once he's in the room, he's golden.

But, while I've had some successes, my batting average is terrible. People explain they aren't adding firms at the moment. Which leads to the exchanges reflected in the post about how these law departments are (or are not) promoting diversity among their existing firms. The conversations have been civil but disheartening.

Again, I'm not shy. If you have litigation in California, email Darth (dvaughn@sandersroberts.com). He is an amazing, experienced trial lawyer on a team of amazing, experienced trial lawyers with impeccable resumes and stellar reference clients. MWBE-certified. NAMWOLF members.

Every box is checked. If they can't break through, who can? 

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The Law Firm COO of the Future

Photo by Charles Forerunner on Unsplash
[Ed. Note: Today's post comes from guest blogger, Steve Nelson from The McCormick Group. Steve suggest the next generation of COOs will need different skills and perspectives to be successful. He is right. - TB]

A recent article in Bloomberg Big Law Business detailed the increasing sophistication of Chief Operating Officers at law firms, pointing out that many of the new COOs have managed corporate organizations, other major professional services firms, and large government agencies.

But the article misses an important factor in what law firm leaders need in today’s environment. Much has been written lately about the challenges that the AmLaw law firms are facing because of the increased scrutiny by clients and their own “chief operating officers”, as evidenced by the growth of the Corporate Legal Operations Consortium (CLOC). What has changed, particularly since the recession, has been a complete reevaluation of the “law firm engagement”. Clients have taken a much more comprehensive view of their outside counsel retention, not just in terms of billing rates and alternative fees, but in the way that their work is handled. This ranges from billing practices, composition of teams, and the reporting of even minor “event changes” that impacts the engagement as a whole.

COOs of the future cannot limit their focus on internal matters, such as financial management, facilities, human resources, and even partner compensation. Instead, these new leaders have to understand, as Ron Friedmann noted in his recent blog post in Prism Legal that “firms must battle for market share while taking steps to protect profits. The best way to do both is by improving value and service. More value and better service means lawyers and firms must change how they work. Anything else is just window dressing”.

Tomorrow’s COO needs to have a solid understanding of things like legal outsourcing, alternative fee structures, legal project management, client feedback and communication, and the factors involved in corporate selection of outside counsel. Three different models come to mind:

Executives of the alternative legal services providers which have earned an ever-increasing share of the legal market, places like Elevate Services, United Lex, and Novus Law. Those executives have shown a razor-like focus on providing value to clients and solving their business problems.

The legal operations executives in many of the nation’s largest corporate law departments. Thinking like a client can always be a valuable skill set for any professional services company and these professionals understand the dynamics of all constituencies that drive legal spend.

Those already in law firms playing strategic roles with regard to such things as pricing, legal project management, practice group management, and client relations. These professionals are on the front lines of the most significant changes facing the legal industry as a whole and are well-equipped to tackle the key strategic issues facing law firms in the future.

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