In this 200th episode of The Geek in Review, talk with Toby Brown, CEO and founder of DV8 Legal Strategies, and Nita Sanger, Director of Digital Advisory Services at Cherry Bekaert. There are three rules for growth and success when it comes to large law firms. Strategy, strategy, and strategy.

Brown emphasizes the need for law firms to develop strategies that prioritize clients and build meaningful relationships. He argues that “firms should start thinking of clients as customers and using customer experience as a way to differentiate themselves.” Sanger shares this view, adding that law firms should “focus on value creation, continuous improvement, and customer experience” as they grow and evolve.

Both Brown and Sanger discuss how law firms can reframe their view of growth, moving away from a talent management perspective and toward a mergers and acquisitions approach. Brown highlights his experience at a prior law firm, where he transformed the lateral partner program into a strategic acquisition initiative. He explains, “this is straight up M&A. So I renamed the program the lateral partner acquisition and integration program. And we treated it much like Apple or Google or any of them would treat their acquisitions.”

Sanger and Brown also touch on the importance of integrating newly acquired practices or firms into the existing business. Sanger emphasizes the need for planning and a program management office to ensure a smooth transition, while Brown shares his success with where hist firm had one of the highest lateral retention rates in the market due to the strategic approach and focus on integration.

Looking into the future, Sanger envisions law firms as technology-enabled platforms, providing a wider range of services, while Brown expresses concerns about the reluctance of law departments and law firms to prioritize standardized business processes over the individual preferences of frontline lawyers. Despite their differing perspectives on the future, both agree that a focus on strategy, client experience, and growth through mergers and acquisitions will be crucial for the success of law firms moving forward.

Listen on mobile platforms:  Apple Podcasts LogoApple Podcasts |  Spotify LogoSpotify


Contact Us:

Twitter: ⁠⁠@gebauerm⁠⁠, or ⁠⁠@glambert⁠⁠
Voicemail: 713-487-7821
Music: ⁠⁠Jerry David DeCicca⁠


Marlene Gebauer 0:06
Welcome to The Geek in Review. The podcast focused on innovative and creative ideas in the legal industry. I’m Marlene Gebauer.

Greg Lambert 0:13
And I’m Greg Lambert. But Marlene, in June of 2018, you and I started this podcast with the idea that there’s so much on the creative and innovative side of the legal industry that just wasn’t getting talked about enough. And now, nearly five years later, we are 200 episodes in. And quite frankly, I feel like it’s still as relevant today as it was from day one.

Marlene Gebauer 0:37
I agree. I mean, I think it’s actually better. And we just we even have more to talk about than than we did back in 2018. So thank you to everyone who’s listened to The Geek in Review over the years, and we’re excited to start working towards 200 More episodes.

Greg Lambert 0:53
Oh, that’s a lot of work. It’s all worth it. It’s all worth it. So we thought it would be great to bring in our good friend and fellow geek Toby Brown to be our guest for this episode. So we reached out to Toby a few weeks ago and asked what he’d like to talk about. And without skipping a beat, he said that well, I’ve had these discussions with Nita Sanger on law firm strategy, and that would be a great topic that would fit the innovative and creative theme of the podcast.

Marlene Gebauer 1:25
So we did exactly what he told us to do. So as we always do, so please welcome Nita Sanger director Digital Advisory Services at Cherry Bekaert and Toby Brown, one of the original three geeks and CEO and founder of deviate legal strategies, Nita and Toby, welcome to our 200th episode of The Geek in Review. Thank you.

Toby Brown 1:46
Thanks for having us. I was thinking about because I have I have always been number two. So I think number 200 is just

Greg Lambert 1:53
we’ll bring you back for episode 222 as well. So. So Anita, your work there at Cherry Bekaert is to help transform professional services firms, including law firms, whenever they look to digitally transform themselves into positions for growth, which would include organic growth or merging or acquiring another firm. And I think a lot of our listeners may not be familiar with Cherry Bekaert. So can you start off by explaining the overall mission is and then explain a little bit more about about your role there.

Nita Sanger 2:30
Sure. So thank you first, thank you so much for having me. So I’m at Cherry Bekaert, we are one of one of the top 25 audit tax and advisory firms in the US. And for them I lead business strategy and digital transformation. So when when you say that digital transformation is such a broad word, so people usually ask Well, what exactly is it do and and I say my primary focus is to help businesses to deal with the world that we’re living in, which is very, it’s like we call it a VUCA world which is volatile, uncertain, complex and ambiguous. And we help them figure out what they need to do to position themselves for growth. That’s in effect is what we try to do. And the idea is that what we say is and why this becomes so important is it’s like you almost need to know what your strategy is where you’re looking to go and then figure out how do you actually tactically get there? That’s what we help them to do. So we help them figure out in a world that’s changing, what’s the industry going to look like, within that? What should What’s your business of the future need to look like? And then what do you need to do to actually get there?

Marlene Gebauer 3:36
We can all agree that law firms can always act more like mainstream businesses. But today, we want to strike at the core of that and talk about law firm strategies. Admittedly, more firms are grappling with that issue. But they seem to all be a following the same strategy and be running the same gameplan of focusing on their practice strengths. So with each of your unique backgrounds, we’d like to get your insights on this important topic. So how about you, Toby? When you talk about strategies for law firms? What do you focus on?

Toby Brown 4:08
Good question, the, and I like to tell a story that six, seven, maybe eight years ago, I saw on an article from a managing partner has actually been new Manage partner, Baker Botts, and he listed their strategy and I was like, wait a tick, that’s our strategy. And then I was like, Wait, another tick. That’s every law firm strategy. And everyone has the same strategy. We I think we already know who’s going to win. But then I thought about some more work and realize it’s not really a strategy, like growth is part of a strategy, but it’s not really strategy. And when firms as you set this out, when firms think about this and talk about this, they talk about themselves, which if you’re coming up with a strategy, that’s part of it, but the other part of it It is you have to look at the market and say, firms to say we’re good at this, we’d like to do this work, that’s what we’re going to change. Well, is that what customers need? And is that what customers are willing to pay for willing to pay, you know, premium prices for, and they leave that part out. So I, you know, when I’m talking to firms and others, I’m like, you really should be thinking about what the, what the market wants, and then not, and then how to be more specific. Like, there is one example that I’m aware of. That’s a little better. And it’s BCLP. Nate came out and I was shocked that came on said, here’s our strategy, and it had three prongs. That was disputes. It was real estate, and it was mid market m&a work in I was like, alright, a firm finally made a statement that’s like, this is the market that we’re going to focus on. The other, you know, now I’m gonna totally mixed metaphors which I was doing. So now I’m on the third leg of the stool, we didn’t start off with the stool. The other piece that’s missing for firms is, if you think about this, many of us have worked at or working at, you know, billion dollar firms. And they don’t know where their profit comes from, you know, if they were normal business, and you all know I have a car problem. General Motors can tell you where their best margins come from. And it’s on loaded up SUVs, typically, and trucks. So you know, this would be if your firm to go you know, what we’re really good at, we’re good at making mid size and compact sedans. Well, there’s in the car industry, that’s not where the margins are. So it’d be crazy to make that decision without understanding that that’s where the margins come from. So I think firms a they need to look to the market and see where there’s opportunity, but at the same time, they need to understand whether they can make money doing this. And they tend to think in it this. Well, every firm I’ve known forever talked to they think all revenue was good, because they think and cash basis mindset where they say, we’re going to generate X million dollars of revenue this year. And so if we just manage our costs, well, we’ll we’ll make good money. In fact, I had recently a COO of a New York based firm say to me, and this was very recently and I was just what he said, Well, we generally cover our overhead by late September, early October, and then from then on, it’s all profit. I was just like, Okay, so that’s just another example that firms don’t know where their profit comes from. So I think smart firms and start thinking that way, and putting that into the calculus when they talk about their strategies.

Greg Lambert 7:44
Without getting too into the weeds. But let’s go back to the Bryan Cave, the BCLP strategy. And you said the kind of got it right? What What would you have added? Or how would you have addressed it to say, okay, you’ve got these three, I guess legs of a stool now, what else would you have suggested that we put that really talks more about their strategy?

Toby Brown 8:11
So the first one disputes, that’s litigation. That’s slightly large and amorphous category. The second one real estate, I liked that more because it’s focused, more focus. But I’m gonna pick on the third one, the mid market m&a. If it were me, I’d say, okay, which piece of that market is going to be in the manufacturing sector? Is it going to be in the tech sector? Or is it gonna be in the telecom sector? Because then you’re saying, Our firm is, our goal is dominating in that piece of the market. That, to me is strategy because General Motors and Ford don’t go, We just want to be the biggest car manufacturer, they want to be the most profitable and so they’re very keen on defining clearly and say we’re gonna dominate like, here’s a fact for you. Three of us are from Texas, one in six pickup truck sold every day is sold in Texas.

Marlene Gebauer 9:12
That does not surprise me one bit.

Toby Brown 9:15
Drive around her and you’ll see it. But that would tell you if you’re going to dominate in the in the pickup truck market, and you know, Marlene and Greg know this, you probably don’t know this Nita, but pretty much every manufacturer has a special Texas of this. Yeah, yeah. That’s them trying to dominate that segment of the market. So back to BCLP. I like they’ve taken the right kind of step, but I would take another step or two further.

Greg Lambert 9:41
Okay, Nita, from your perspective, what what are you seeing in the market?

Nita Sanger 9:47
So first, I absolutely agree with Toby about the whole thing around strategy and law firms. I was very interesting because I was actually presenting to, to the global 100 CIOs And it was interesting that all of them were there because they were trying to figure out what they call like the, you know, the law firm of the future or the legal desktop of the future. And all they were thinking about was how to make our people work more efficiently. And I kept on saying, well, and we talked about that there was a we were I was on a panel, we actually discussed that. And none of them were thinking about how we serve our clients, much more effectively, to me. And I just thought that was such an interesting way to sort of approach the whole thing, that all you’re thinking about is your people. And not to say that that’s not important. But that’s just one piece of it. You have to be, who are you going after who your clients, what are their needs are they needs changing. And especially now when the role of the General Counsel is becoming so much more important and so much more complex, because whereas the league, you know, the, the general counsel was always brought in, or the corporate legal department was brought in, okay, we’ve, we’ve done all of this, now, you just create a contract for us. Now, in a world that’s changing so rapidly, they almost need to have a seat at the table much early on, because as you’re making decisions about using which technology etc, you need to have legal a seat at the table, which means you need to understand what their needs are, and then what you need to be doing to effectively meet those needs. And it’s just, in some ways, kind of shocking that they don’t do they don’t think about it in that fashion, who my client is, what do they need? How are they changing? And what can I do to serve that more effectively? Then the second piece, which I always think is interesting is that what I’m seeing from a strategy perspective, a lot of the largest firms have been doing well, they’ve not had much of a burning platform for change. They keep on raising their rates, and it seems to be so far working for them. What you always find is the next year after you get past really the top 20. Sure. So the next one’s realized that the market is changing. The other ones are feeling the pressure. And so now they’re thinking of what they need to do to have different strategies to continue to grow their business, or to think about what they need to use technology to become much more efficient, do they need to have more things like a, you know, we create, like some kind of a startup and I just found that that was very interesting. And so that’s where you’re starting to see a lot more activity. And they always say, right, when change comes in, it’s come from the lower end of the market, because those ones are much more hungry and are much more adaptable to change to meat. That’s what I’m actually seeing. And you’re starting to even see that in some of the deals that have got announced that it’s that lower end you’ve heard of like Orrick, Buckley, Taft and, and Jaffe and, and they were they’ve been talks about things like Sherman Sterling, which I think right now, it’s not gonna happen, but but I think that’s what’s happening, that it’s the the ones who are more hungry, who are feeling more the pressure or actually sort of thinking about doing things differently.

Greg Lambert 12:52
Do you have some examples of where you’re seeing firms get this, right?

Nita Sanger 12:57
So what I’m seeing is farms being innovative or trying to be innovative and doing things differently. So I’m sure you’ve heard, like, you know, Wilson Sonsini started its own digital hub. Denton started next law labs, Baker Hostetler started IncuBaker. So they’re at least thinking about things differently, which to me is sort of saying, Okay, so now they’re starting to realize that just continuing in the same way you cannot, you have to think about things differently. And when you see this across in other industries, that’s what they do. Because they always say, for you to disrupt yourself and within your business is going to be very hard. So you create like a startup that almost sits outside of the core business. And that’s what you’re starting to see some of these doing. And I saw that at a big four, when I was trying to transform the, you know, $9 billion business, that’s exactly what we did. We got it outside. So to me, that’s actually a good start. But sometimes when you and when you sort of Scratch below the surface, what you find is that they’re doing the same thing like focusing on in or it’s how can we do things a little more efficiently, they really aren’t thinking boldly enough, like how can we disrupt our own business, but for somebody else comes and does it to us? So that’s, that’s kind of an interesting balance that you and they need to be thinking or more aggressively.

Marlene Gebauer 14:13
I’m wondering, I mean, is it the business itself, that’s kind of holding them back? Because, you know, we talk a lot about how incremental change in firms is usually very successful. But, you know, a lot of the very disruptive types of change, you know, ChatGPT aside, you know, often don’t happen often. So, you know, are they kind of up against something that they you know that they can’t win?

Nita Sanger 14:37
I’m not sure that it’s that they cannot win. It’s till now, to be honest, the legal industry has been quite insulated. But we’ve already started to see that in a lot of other industries where you cannot continue in the same way and not and not change. You’re going to have to think about things differently. And I think what this comes down to is almost figuring out what’s the core value you bring to your clients? the core value is legal advice, which means that’s the most high value activity you should provide to your clients and continue to do that. And everything else that’s non essential to that. Figure out how you can automate it. You can outsource it, or just like, you know, is it is it necessary to be done by your team? Can we just give it to somebody else, you know, it can be standardized, automated or outsourced. That’s the way to think about it so that you can focus on the most high value added activities. And then as you continue to think of what else you can do, we just talked about the changing needs of your clients. So I think the opportunities are huge, you can continue to say this is my world. But now if you you can see that your clients worlds are expanding, then what can you do to meet their needs more effectively? And that’s where you can think about, Hey, maybe I could do an acquisition, maybe I can form a strategic alliance with someone who brings a capability which I don’t have, but my client might be needing. So there’s, I think the opportunity is just you need to have that mindset of thinking sort of a little bit outside the box.

Marlene Gebauer 16:03
Absolutely. So Toby, how would having a strategy change a firm’s focus and operations?

Toby Brown 16:10
I’m gonna go back and I’ll leverage that BCL comment I made and I’m going to overlay with something Nita just said, If BCLP, or a farm said, are we’re going to dominate in mid market m&a in the tech industry, Nita talk about, you know, the it, people were like, Oh, we’re, here’s where we’re focused on and it was internal. And the reason I believe that they make that focus is because that’s safe. They can, they’ll have just associate saying, we need better drafting tools, or we need better this or better that. And they’re not there. There is no strategy involved. And so if you’re not countering any strategy to firm might have, what that begs the question is, how do you make an IT investment priority decision? You can’t, if your firm strategy is to grow, then you’re going to invest in AI, any it that might lead to growth. Whereas if you’re if you’re focused on mid market m&a for the tech industry, that tells you almost every decision your firm should be making your business should be making, what sort of professional development should you focus on? What kind of hiring should we do? What sort of tech should you know, should you be focused? You know, I’ve been on some of those same falls where there roundtables. And, in fact, recently, you’d be mentioned ChatGPT, Marlene. Oh, we’re, we’re trying this. And we’re trying out and I said, You should step back and say what part of your firm drives your profit and revenue. And that’s where you should make an investment. And I always pick on the poor labor lawyers, if you have this m&a practice that throws off labor work, I would not be making big investments in labor, tech, and labor process and all that kind of stuff, I’d still be making the investments in m&a. So I think if you have a strategy, all of a sudden, all those decisions are far easier to make. And then the CIO, they know when someone comes to them saying, Hey, here’s a new technology that helps in m&a they go Yeah, I really want to see that versus labor or whatever, you know, product liability, I don’t know what the others would be. So to me, it’s like the filter for how business decisions should be made. And without a strategy. In fact, my last point here, and this may have been a firm I worked at recently, I found out there were over 500 databases. And like, sounds right, Emma’s just said about what I said holy something. And then that I said, Do you guys even know which ones are being used and how much they’re being used? And I got this look like, no one’s ever asked us that question. So I was like, if you had a real strategy, it would be really easy to go down that list and go this. These are not these are not drive strategy and profit driving tools. Why do we have them?

Marlene Gebauer 19:08
It’s like, who’s using them? Who’s using them? Are they part, you know, is that business part of the the core strategy? And are they are they using it? So Nita mentioned that strategy, we’ve been talking about strategy as a core issue. And, Toby, I think you were highlighting some things here in terms of what firms you know, need to be thinking about in terms of developing a strategy. So where in real life do you think firms are getting this wrong and why?

Nita Sanger 19:37
So what I tend to find is that where firms are getting this wrong is because they almost feel like well, nothing is going to change because when change is happening initially, it seems it’s these little bits and pieces. So I think that’s what they keep on saying no, this is how we’ve been doing and this is how it’s going to continue and, and industries such as legal, you know, that’s what the nature of the beast says that that’s what they that’s how they kind of perceive things. But the reality is if you start looking at every other part of our life has changed so drastically, there is a need to think about things differently, which means that you if you’ve done things the same way, is there a different way of doing things. But the one thing to recognize is that change is incredibly hard. People are very resistant to it. So what becomes key is to then almost starting creating that culture of change. So just to give you some examples, that where you find that change comes at people who are doing the work will be the ones who’s actually seen first, because they’re doing something that is so incredibly painful, that they start saying, hey, is there a better way to do it, that I’m not spending hours of my time doing it. So that’s when you start to create that culture of change. To just give you an example, when I was transforming an audit business, the person who was actually going and doing inventory was getting so tired of having to go in there you go, there, you go count, you make them, you make a mistake, you come back, you fill in your report, you go back. So he said, I just found that so painful, then we said, why don’t we create an app that could do that for us. So that what I’m trying to say is, then you start creating a mindset for all the people who are there within the framework, and then think about this differently. So it’s, it’s creating that culture that everybody thinks of themselves as a change agent. And you’ll find that that with the more the more junior people, because they’re used to using their phones for everything. So creating something that can be done, which makes their life easier, because they’re seeing that in every other part of their lives. So they’re like, why can we not do it in this, I think that’s where, and, and that’s why it has to be more than just very tactical, you have to have that strategic thinking. And that that also the thinking has to come from the top. So the role of leadership when it comes to something like strategy is so critical, because they have to be willing to sort of see able to see, you know, basically almost like looking around the corner, seeing where the changes are not where it’s today, but where they’re going to come from next. That becomes incredibly critical, because they will decide the strategy and then everybody else kind of executes on it accordingly.

Greg Lambert 22:06
I’m just curious with the focus here on on strategy. Does every firm need a chief strategy officer to help keep everyone in line? Or is that something that can be built into the overall process of how the firm addresses change and, and goals for the next years to three years?

Toby Brown 22:29
I think firms need something like that, I don’t know that they need to call it this strategy person, they might call it a commercial role. But if you think about all the departments at a law firm, none of them, for the most part, except for of course, practice management, or the business. There’s the IT people running IT, there’s the marketing people running marketing. And you know, an HR know not which department that a lot of the law firm are, what would you call it, that is just worried about the business? There isn’t one. And so a strategy person can become that. But I think right now, a lot of strategy people, it’s a kind of a nebulous thing, we’re out in the hallway, it’s not, it’s not the business. That’s my remark to that Nita, feel free to.

Nita Sanger 23:21
So I agree with you, there needs to be someone who does it, who and that person almost needs to be almost like the equivalent of the right hand of the CEO, you can call them by whatever title, but they need to sort of understand what first what the leader wants to achieve, then help kind of say, Okay, now this is what we’re trying to get to, and then help figure out what and give suggestions about what the strategy needs to be. And it needs to be at the thing of Okay, so what are we trying to achieve? Where are we going to get it from almost as if the CEO says, I want to grow by five millions of where’s that going to come from? Which are the clients where you would get it from? What’s it gonna take? Which industry? What are we as a firm going to be known for? And that Toby goes back to what you said, you almost need to be able to define that very clearly. I want to be selling the best, what was it trucks in Texas, you need to have that level of specificity. So that’s why you need that strategy person. And it’s gonna be like, who am I going to get it from? Who are the people I’m going to go after? What’s it going to take to win them? So yes, you certainly you definitely need someone who’s thinking from that point of view, because and I know a lot of time, people tend to think maybe it’s the COO. And in some cases, it might be at that person. But it really depends on the firm. It cannot be the CIO, because they are very busy making sure that the technology within the organization works. And I would say that the strategy person needs to be there who understands the business, so it could be like in so Toby, I mean, I’d love to get your thoughts because I don’t know whether you need both sleep strategy officer and a Chief Operating Officer, but that would be kind of good to hear what your thoughts are on that.

Toby Brown 24:58
Well, I would, I would put most COOs really as operational, so not not strategy. And it would they would benefit from strategies, they would know where to focus operational resources. But again, what I’m seeing in the market the strategy, people kind of sit off to the side where they the center, if I had to pick someone out of firm that I said was the business practice group leaders may be the closest thing I could find. Okay, can I can I take up the your question Marlene, what, what’s wrong or what’s what’s wrong and why go for it, because he picks right up from what we’re talking about the why piece of it is, I just said, I think the closest thing to through the business is the practice group chairs. And I can say this now, because I’m not at a law firm, law firm leadership, people, it’s a part time temporary job. Just let that soak in. So these are people that are chosen elected to run a business unit, and then at my last for, you know, the largest practice group, that’s a $300 million business. And it’s not that these people aren’t smart that they have no expertise or experience in running a business. So there’s problem number one for the why. And the that even applies to the managing partner. And if you’ve got a board, executive committee Management Committee, again, those people, they’re doing it for a period of time, and I’ve seen it time and time again, they can’t wait to get out of that role. Because it just burns them up. And they have to keep the practice going. And all stuff like that. So there, there’s Layer number one, layer number two, for the wide, is lawyers again, very smart, capable people they like to and how many of you guys have heard this 1000 times I just want to practice law. And that’s they went to law school, and they just want to practice law, they don’t want to worry about the business. But an aspect of that is they want to do what’s interesting to them, which I can’t fault them for. But that means they’re not saying I want to solve my client’s problems, I want to solve my client’s legal problems. They’re like, Well, no, I want to have the most interesting litigation I can do, I don’t want to do boring litigation. So that’s that strike to strike three is our part time temporary leadership, their core focus is not clients. So I was counting in my head, and I’ve lived through at least six maybe seven managing partners. And what keeps them up at night is not that the clients are going to fire at a firm. What keeps them up at night is that a partner might leave? Yeah, this was a rule one of my mentors gave me years ago, when I was at the first big firm, and he had a couple of rules, golden rules, and he goes, anything that might cause a partner leave, is immediately going to get killed as an AI their decision, which back to the BCLP example, and why I was impressed that that did state those three, as soon as a law firm says, one of our course, you know, strategic focuses are going to be Midmark and m&a for tech. There’s going to be 100 partners a go, that’s on me, are you telling me I don’t belong with this firm? Should I be looking? You keep this up, and I will be looking. So that’s what keeps the managing partner. It’s not strategy, and you know, the long term profitability of the firm. Sure, many managing partners are going to disagree with that state. But But I just tell you from experience, that’s their number one concern is almost always will partner lose. I’m sure you got

Nita Sanger 28:43
what you said. Toby can add to that it’s a different skill. Being a good lawyer, it’s a very different skill. Being good at marketing is a different skill, which a lot of them we know lawyers are not but to actually run this as a business, and specially so that’s that. So it’s not everybody has that skill. The second piece of this that also becomes like very key is in a law firm, when the only thing you’re valued at is that you’re a revenue generating partner, to then go into a role which may be viewed as being more administrative, because you’re not bringing in revenues, even if it is critical for running that organization is not given the same level of importance. And that means and for every lawyer who’s sort of like, you know, how much it’s like, what’s the profit report and how much money am I going to get into my pocket to then be taken out of that kind of a role, even if you are the CEO of to them? It’s almost like a demotion, even if the title sounds bigger, because then you’re not in a revenue generating role. And in some ways, I think that’s a little bit of a mistake of how law firms they are businesses and that’s what they need to think of themselves as. And if you don’t do that, you’re not setting yourself up for success. Look at any other As businesses, they will have people who bring that ability. And if you don’t do that, that you bring in people who actually know how to run a business, and are rewarded for doing that effectively, that those are those two things unless you get that correct. And that’s the the industry hasn’t quite figured out how to get that correct.

Greg Lambert 30:18
Nita, on a recent podcast for Cherry Bekaert, where you talked, you were talking mostly around strategy when it comes to law firm mergers. So you said something in that interview that really caught my attention. And that is new buyers of services tend to not want to become clients of a firm, until all that integration is completed with the acquisition of another firm. Can you talk more about the customer experience or CX and how law firm leadership needs to take that into consideration as they’re creating that overall strategy for the firm?

Nita Sanger 30:57
Absolutely. So the thing that what I was trying to say when I when I mentioned that was that at the end of the day, what clients are looking for, is like a seamless experience. More often than not, they don’t care what you have, at the back end, they want to be able to go into one single place where they’re able to get all the needs that they’re looking for met, where they need to get information, they want to see you know, where their cases where, where it is in the process. And if you’re not able to provide this to them, that to them is not a positive experience, they will go to someone who can provide this. And we have seen that in so many different cases. And I think in some ways, if you think about what we’ve been spoiled by play, like all the different sort of platforms that we go to, like you go to the you go to Amazon, you go to netflix, they remember about you, they remember what your likes and dislikes are, in some ways, that’s what they’re going to be expecting, even from the law firm that they go to. And unless we’re able to do that, and like we’ve been talking about, that’s something that law firms haven’t paid enough attention to. And I think Toby, you mentioned that, too. They’re very focused on Well, we are experts in X, but it’s not looking at it, or we are experts in this set, you know, in this area of law, but it’s not so much looking at what are our clients needs? And how can we meet them in a more holistic fashion, to get your clients to be more sticky. That’s exactly what you need. And you need to be able to provide that. And so that, like I said, that’s why the technology becomes it’s like that enabler to provide them with that seamless experience.

Greg Lambert 32:32
And so I know you’re, you’re probably well aware of this, but I’m going to state the obvious. But the legal industry itself tends to think of itself is, you know, different from all the other professional services firms. So I’m curious as to what do you see in the other industries that are common that the law firms could adapt that would help them in setting the overall strategy of the firm and be successful in the long run.

Nita Sanger 33:02
So the first, I would say, so there’s more than one, obviously. But the thing that I want to start off is, I think that the role of leadership, where you actually have leaders and and I and I’ve come I’ve done a lot of work in consulting, and an audit and tax. And so you’re talking about industries, which are actually bringing a lot of those capabilities, where you have people who bring that so that one has to be the capability that the leader is able to think about the business in a much more holistic fashion, which I think is incredibly critical to to make a business successful and to grow. And if you think about it, like I’ve come up with the Big Four, when each of their service lines is like $9 billion, $10 billion, if any of their service line actually dwarfs, even the largest law firms, you have to start thinking about it in that fashion. The second part is having the ability to invest back in the business for growth. I know the way law firms is like at the end of each year, you’re like whatever you make you you sort of give it out to everyone, in effect, consulting firms or as much partnerships, as law firms are. But I think the model there changed where you’re already sort of you put aside a certain amount of revenues you take away from like the partners pockets to put into the business, you can continue to grow the business, especially in an world where technology is changing so rapidly, and you have to continue to be on the cutting edge of it. And and Marlene, you mentioned like ChatGPT, etc. That’s one there’s so many others that are gonna continue to come in. And you need to have the ability to be able to invest in it to be able to experiment and say, Okay, what exactly does this mean? What’s it going to mean for us before you can bring it into the business? So I think those two things will become an incredibly critical and this is what we’ve seen the other industries that have been successful, have done that. And I would say this that some of them have seen more the burning platform for change. Just to give you an example, like the audit business, you started to see that margins were flattening because clients were like, This is not adding value to us because doing an audit and backward looking really doesn’t add that much value. Tax, if there’s a whole portion that is repetitive, etc, that like, why are we paying so much money? So that and that’s what you start to see is that the businesses are starting to have to think about, where is it that we’re bringing real value to our clients. And then let’s just focus on that piece. Everything else that’s non essential to that. Let’s just figure out what we do with it either we automated we outsource, as we said, we run it as a shared service or a managed service. And I think that’s the other one that the legal industry kind of could benefit from thinking about the business in that way. So providing all the tools and technologies to be able to afford to make the people more efficient, and then just focusing on the most value added activities.

Marlene Gebauer 35:50
So, you know, Toby, you have a creative view of law firm acquisitions, you know, how do you feel that that relates to strategy?

Toby Brown 35:57
Very good question. And thanks for putting this out there. I actually think in many respects, this is the tip of the sword. So if you have a strategy, and Nita mentioned it earlier, is it organic? Or is it not and organic is promoting partners from within, inorganic or outside of that is acquisitions. And so if you think about a company like Apple, if they’re going to grow, they know exactly where they’re going to grow. And then they have an m&a team that goes out and scours the market for players that can either augment what they have or fill holes in their business. So when I took over the lateral partner program, at Perkins six years ago now, I looked at it and I said, this is not talent recruiting. That’s barely ever what we talk about when we talk about laterals, I said, this is straight up m&a. So I renamed the program the lateral partner acquisition and integration program. And we treated it much like Apple or Google or any of them would treat their acquisitions. We number one, as you might guess, profitability was an assessment. It wasn’t just oh, we have a book of $5 million. It was what kind of work is that? What how well leveraged? Is it? Are you getting your rates, and I actually reflect on my pricing person over from pricing to this because she had that background on profitability and could make that assessment. We had other due diligence factors as part of this portability of the work, it was far more an m&a approach. And there’s now companies like Decifer that actually, or third parties that can help you in your diligence. So it’s an emerging thing. Sadly, most firms I’m aware of, don’t really have a strategic acquisition type focus for their lateral acquisition program. It’s very opportunistic, which is what Perkins was, when I got there was like 80%, opportunistic, and we flipped it towards probably now like 90% strategic, and you end up with a strategy matrix, it says, if, if it’s a priority one, it gets to the highest level of resources committed to admin on down the fact we ended up with a side program, we called the Strategic Growth Working Group, which was looking at more than a onesie twosie is if we were going to require a firm or a practice group or something like that. So it was highly, highly strategic. The last best aspect of it that I mentioned was integration. And again, think about if you’re Apple, and you’re acquiring company, you don’t wait until all the paperwork signed to go, Okay, now, we need to integrate this. Integration starts way before that, and so that that Perkins, that integration aspect got involved early on, well before would come to an agreement like do we have a business plan for this person? What does it look like? And then once they once that was a deal, and that started, boom, we had this plan, we integrate them with the right practices, the right clients. And Perkins actually had one of the highest lateral retention rates in the market. And it’s because we’re treated it that way, and not like, oh, a recruiter came and said, Look at this, you should acquire this part. That’s not strategic at all. So I really do think the lateral programs are like the tip of the sword of strategy. That’s where you really see it come into focus. So thank you for throwing that question out.

Nita Sanger 39:29
What Toby said actually applies even when you do an acquisition of one firm with the other. You have to think about this in a much more strategic way. You need to be thinking about not like, like Toby said, not after you close the deal, and not just think about, okay, how do we get the technologies to work together and make sure everybody’s got the same PCs and all the same emails. It’s actually thinking about okay, we did this for a reason, what are we hoping to achieve from it? And then what do we need to put in place to tactically execute on it so there’s a lot of planning that needs to go into it. And almost like creating, like a program management office, because when you’re actually doing the integration, it is it requires bringing together all these different pieces of the business. And it’s also making sure that you bring people along on the journey, you’re bringing two sets of groups together, it could be that like, people are going to be like, okay, so what is, you know, Greg’s coming in? What does it mean for my job? And then Greg’s going to be like, Well, what, what’s going to happen? I’m going from the firm that is getting acquired, what am I going to be doing? There is so much about this that one needs to be thinking about. So there’s the people piece of it, which you, which is very critical. There’s the technology side, but it’s also the business side, what are we looking to do with it, I think it’s very, very critical. And to be really successful, when you do an acquisition, you don’t just give it to a lawyer and say, Okay, now this is like on the side of your desk, why don’t you do this? Because that’s not going to be effective at all?

Greg Lambert 40:58
Well, now we are at the part of the interview where we ask all of our guests the crystal ball question. So Nita and Toby, we’re going to ask you to pull out your crystal ball and look into the future for us. And, Nita, let’s start start with you. What do you see on the horizon for the next two to five years and in the legal industry? And, you know, just how do you think if or is it going to have any change, and how it looks at strategy?

Nita Sanger 41:30
So I would say, so let’s start off what I think is gonna happen from the law firm, what the law firm of the future would look like. So just as we’ve been seeing that in other industries, I almost think it’s going to become a little bit of like a platform play the because the law firms have really good relationship with their client, they are their trusted advisors. So what I think is going to happen is they’re probably going to be more of a technology platform that they’re going to be using to interact with their clients, it’s not just going to be lawyers will obviously continue to be the key people, but it’s going to be they’re going to be enabled by a technology platform that that lawyers are going to be like, that the clients are going to be able to come into, and then the law firms are going to be able to provide services using that front end, which is a technology enabled, to bring in different kinds of services, etc. to meet the client’s needs more effectively, you’re probably going to be going beyond just providing legal advice, it’s also going to be that you will be productize offerings that your people are going to be needing. So I think it’s going to be a much more wider range of services that you’ll be providing. So there’ll be productized offerings, there’s going to be what legal advice, but it’s going to be if there’s the need, clients are going to need information on risk, or they need analytics, all the other services that they’re going to need given the expanded role. That’s how I see them interacting with their clients are having deep insight, and having information that would help their clients run their business more efficiently. And then at the backend how people operate, it’s probably going to be, you know, that from a talent perspective, it’s not just going to be full time lawyers, it could be specialists in particular areas, you will create a platform where you will have people who want to work, you know, in a fractional they might be remote, the people part is going to be that way. And so it’s going to be a really interesting combination, we’ll be using a lot of technology solutions are legal tech enabled solutions at the back end. So at the back, it’s going to be really complex, but integrated way of how the business is going to be run. So I see it actually very, very different. But where a lot of times when I find when you go for any of these conferences, like here we are the lawyers, and they are the vendors, I think that’s also going to change, it’s going to become much more integrated, because they are enabling you to be more successful. I think that intimacy, some of those things are going to become that. So the change is going to be very much that way than where the legal industry or the law, the law firms are going to treat the legal tax, not as just vendors, but actually helping them be more successful. And the whole platform plays a very different way of how the industry would be looking.

Marlene Gebauer 44:01
So Toby, what does your crystal ball tell you?

Toby Brown 44:05
So Nita and I have agreed on a lot, but here’s where we shall diverge. So talking with two different legal ops people recently, that will sort of bring home my less than favorable view of the future for the legal profession. These are both legal departments with hundreds of lawyers. And they both basically said well, over well, over half of the lawyers in our legal department have independent buying authority. When the first one said that I went, wow. And then I thought, well, yeah, that’s because the front line lawyers are the ones who decide which firms. I’ve said this before, I’m like, I don’t want to be on your panel because they have to negotiate a big discount and your your lawyers are gonna hire they want to hire anyway. And if I’m not on the panel, I’ll still get hired and I will have a big discount. But here’s the hardest part of that. So I asked them both. Well, will your general counsel mandate that there will be a more rigorous process for how outside counsel was chosen? And the answer was absolutely not. So that’s why I don’t think I think, you know, ChatGPT does, obviously, capabilities that could change things. But until both law departments and law firms start saying, You know what, frontline lawyers, you don’t get to make all these decisions anymore. We’re a business we’re gonna standardize what we’re gonna, you know, great processes, or we’re going to make decisions based on business not about what you think or want to do. I think what has happened is lawyers misses part of their ethical credo they have an independence of judgment when it comes to the law. But that has bled so far and operations and business decisions that it’s like every partner has its own little business inside the firm. So I’m less rosy about what I actually would prefer what Nita describe to actually happen but until that gets broken, we’re going to plod along, I’ve talked already know some firms that are like you’re not even allowed to talk about generative AI and Large Language Models because that will put the clients privileged information that risk on was like there is my Eyore to Nita’s projection.

Greg Lambert 46:31
I think I think all the listeners are going to hope for Nita’s crystal ball to be right and but prepare that Toby’s crystal ball is actually right. So Nita Sanger and Toby Brown, I want to thank you both for coming on our 200th episode and celebrating it with us. Thank you very much. Thank you.

Nita Sanger 46:52
Thank you for having us.

Marlene Gebauer 46:53
And of course, thanks to all of you, our listeners for taking the time to listen to The Geek in Review podcast. If you enjoyed the show, share it with a colleague, we’d love to hear from you. So reach out to us on social media, I can be found at @gebauerm on Twitter,

Greg Lambert 47:06
And I can be reached @glambert on Twitter, I almost forgot my handle there for a second. So we’ll put Nita and Toby will put your guys’s social media links on the show notes as well. But let’s go ahead and let people know where they can can find you. Nita, what about what about you?

Nita Sanger 47:24
You can find me on LinkedIn. And I’m happy to continue our discussion.

Greg Lambert 47:28
And Toby, what about you?

Toby Brown 47:30
You find me on LinkedIn too. and numerous other places, but LinkedIn is good.

Marlene Gebauer 47:36
And listeners can always leave us a voicemail on our Geek in Review Hotline at 713-487-7821. And as always, the music you hear is from Jerry David DeCicca Thank you, Jerry.

Greg Lambert 47:47
Thanks, Jerry. All right, Marlene, I’ll talk to you later.

Marlene Gebauer 47:48
All right, bye bye