8/8/11

The Blue Ocean Law Firm

A friend recently gave me a copy of Blue Ocean Strategy, a business management book from 2005. The concept is very compelling, create new markets rather than struggle with increased competition for existing, shrinking markets. The authors call these new markets Blue Oceans. The competitive markets are Red Oceans, for all the blood in the water from cutthroat competition. Some of the examples they use are Cirque de Soleil and Yellow Tail Wines. These companies chose not to compete with the existing players using the established methods in their respective industries, and instead created new markets, by changing aspects of their businesses that kept customers away. Faced with a circus market focused on animal acts that were expensive and controversial, and on a standard circus model which wasn't captivating audiences like it once had, and on market forces which were decreasing ticket prices in an attempt to compete with other regional circuses, Cirque de Soleil, ditched the conventional circus model all together. They dropped animal acts, they gave their performances themes, and artistic flourish, and they raised ticket prices to compete with theater, rather than with other circuses. Yellow Tail wines recognized that people were put off by standard wine terminology, and that most people weren't willing to take the time to understand the complexity of wines, so they created simple, drinkable wines, removed all the fancy oenology gobbledy-gook from the label, and marketed their wine to beer and cocktail drinkers. The result in each case was phenomenal success in industries previously seen as completely saturated and shrinking. They created Blue Oceans by choosing to not compete directly with their competitors in the Red Oceans.

This got me thinking about our ongoing Law Factory vs. Bet the Farm discussion. It seems to me, that whether we choose Law Factory or Bet The Farm, we're still talking about a standard law firm competing for standard law firm customers in the same old way. We're just segmenting the market and focusing on our chosen segment. But what if we imagined a Blue Ocean Law Firm. One that ditched the conventional wisdom, and set out on a new path building the law firm from scratch. Our Blue Ocean firm wouldn't bill by the hour and it wouldn't incentivize the attorneys by encouraging long hours. Instead it would bill based on the work completed, in a clear itemized manner. It would drop the Partner / non-Partner tracks and court attorneys who were interested in making a very good salary while practicing their profession for 40+ hours a week and having a life outside of the firm, rather than working young associates to death with the promise of potentially making ungodly amounts of money in the future. And most importantly, the Blue Ocean firm would actively write their legal documents in English rather than legalese, and would strive to minimize the length of those documents whenever possible. Rather than making attorneys unnecessary, this would make them more approachable. While we're at it, let's reconsider the staid, stale, law office. Let's make it inviting and welcoming. Let's drop the hard wood, and marble, and introduce couches and carpeting. We'll cut the long list of Partner names in the firm name and go with a simple catchy name like Blue Ocean Legal. In short, let's get rid of everything that makes people hate attorneys and start providing services which are simply defined, easy to understand, and affordable.

That's the firm I would go to if I needed to create a will, set up a trust, or create a contract. That's the firm I would seek out to advise my small business. That's the firm and the attorneys that I would want to build a long-term relationship with. But before you write this off as just another vision for a discount law factory, everything I've described would be welcome to big businesses as well. Simple billing for work completed and services rendered; pleasant, happy, well-rounded attorneys who are not motivated by profit at my expense; and legal documents written in a language that I, as a non-attorney, can understand without hiring another attorney to translate them.

I'm not often called a naive optimist, though I suspect I may be after this post. Still, I would bet that a firm like I've described would be hugely profitable and would avoid the Red Ocean of the current legal services market.

We'll probably have to wait to find out until the law changes and I can own my own firm. In the meantime, maybe I'll go get my JD.

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4 comments:

Kate Simpson said...

fabulous post!

I've been thinking along the same lines for some time: re-architecting a law firm from the ground up; what would that look like?
If law firms went fully client-centric (Client UX) as I'd like them to (it'd be fascinating work for me any way), I think they'd look remarkably like the law firm you describe here.

Thanks for articulating some of my silent thoughts Ryan ;), and look forward to meeting you at ILTA hopefully.

Anonymous said...

I remember reading the Blue Ocean book several years ago and being very impressed with its premise. (I usually find these business books to be vacuous and forgettable.) But I'm not sure you're actually describing a Blue Ocean Law firm. Most of your suggestions relate to attracting employees (attorneys), not to attracting clients.

On example: I'm not sure how writing legal documents in plain English helps the Blue Ocean Law Firm get more business or compete better against other law firms or in filing pleadings in court. Should they write motions that don't contain case citations because those damn citations are too "legalese-y"?

You also write: "That's the firm I would go to if I needed to create a will, set up a trust, or create a contract. That's the firm I would seek out to advise my small business." But my guess is your view does not reflect the view of most of the clients of your current employer. Although clients are looking for things like predictability in billing, ultimately they are looking for great legal representation. (And they certainly don't care if the firm uses wood as part of their interior design.) If the Blue Ocean Law Firm had all of the features you described but didn't practice law as well as the Red Ocean law firms, it wouldn't get very much (profitable) business.

Ryan McClead said...

Anonymous,
You hit on a good point. If you don't practice law as well as others, then you won't get clients no matter your structure, or interior design. I guess I thought that went without saying. If, however, I can get a contract written in English that is every bit as legally binding as one that is needlessly wordy and arcane, I would choose the English one. In fact, I'd pay more for the English one and I suspect at lot of other people and companies would too. If my English-writing attorney was also pleasant to be with and had a comfortable office, all the better. I suspect someone at Ringling Bros once said, "but people don't go to the circus for artistic interpretive dance." And they were right at the time.

Unknown said...

Our firm Heritage Law has utilized "blue ocean" strategy. The details can be found here: http://www.slaw.ca/2010/01/11/a-different-way-to-look-at-law-firm-strategy/

 

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