As recently as last Friday, I made the claim that the legal profession is in a Buyer’s Market for legal services. I’ve even made the same statement here at 3 Geeks. Pondering over the weekend got me re-thinking that assertion. After an enjoyable dialog this morning with Jordan Furlong on a range of topics, I mentioned this concept to him. Talking over it further solidified the idea in my mind. We’re not in a Buyer’s Market right now. Lawyers are in a plain ole Competitive Market.
In its simplest definition, a Buyer’s Market is one that has more sellers than buyers. Looking at the legal services market – has there been some big shift in the number of buyers or sellers recently? No. There has been a downturn, but that’s not the same as a shift in the basic equilibrium. Numerous reports have shown that the seeds of the current situation for law firms were sown a few years back, but only recently came to roost. For a number of reasons firms have for years been able to raise prices without much regard to the market. This is no longer the case.
My main point is that since we are not actually in a buyer’s market, instead of tactics focused strictly on price competition, we should be contemplating survival in a competitive market. My prior blog post noted above on Change Happened, argued that we are in the ‘New Normal.’ For law firms this new normal means that in addition to dealing with rapid technological change, we must now learn how to function in a competitive market. This means being innovative, efficient and effective, pricing competitively (hourly or AFA) and focusing on the right markets and service lines. This is, in the words of Karl Polyani, the time for The Great Transformation of the legal market.
My suggestion: Keep you hands inside the car at all times. This is going to be one big thrill ride.

I am sure that by now that all of you have at least checked out a virtual conference. Yeah, they are kinda goofy but it is an easy way to learn about vendors and hear some great webcasts without leaving your desk chair. Well, the other day I was being interviewed for a news story–okay, sorry for the little bit of self-promotion but hey if I don’t toot no one will (err …)–I started going off on one of my new favorite riffs: virtual court rooms. I was telling the reporter that I could envision a time, maybe in a 100 years, when we will have virtual court rooms. Juries will log into the courtroom. The lawyers will present audio, video and documentary evidence virtually. Judges will be able to preside without having to wear those black robes. Just think of the ramifications: jurisdictional issues, jury selection, proving up evidence. The technological issues of cross-examination, objection, recording and preserving a record. Would it eliminate the need of court reporters? Would create a need for court room technologists? Which raised another thought for me today: if we could have virtual court room, why couldn’t we have virtual law firm partner retreats? Frankly, I don’t think the large law firms would go for it. They love seeing each other and swapping war stories. The golf games, the spa time and the clay shoots. But it is already happening on the corporate side. Investor Relations reported that more and more companies are choosing to hold virtual annual meetings. So maybe it will happen in my life time.

Well, at least now we can assume we know where a lot of those 132 jobs at Banks-Baldwin are going to wind up. According to the Philippine Business Mirror, Thomson Reuters Legal (TR Legal) is using its 275 employee Taguig City, Philippines office as a launching pad. According the article, the Filipino office will be where the “data are processed, codified, proofread, analyzed and validated by Filipino employees and packaged as products for the customers in print, digital or online format.”

Outsourcing to India and the Philippines is not new, even for TR Legal. I did find it interesting to see the wording that TR Legal COO Vin Caraher used when describing what they are doing.  Caraher said that this office is “not legal outsourcing. We’re hiring and training them as our employees.” Granted, this is not legal outsourcing, but the semantics of the discussion are probably pretty hard to hear from those at Banks-Baldwin who are watching their jobs go to overseas offices. It’s also got to sting when they also read from Caraher that TR Legals expansion in the Philippines “reflects our commitment to growing our capabilities in the Philippines. The work being done at this site by our highly skilled and talented team is critical to our global content operations, and in supporting legal professionals around the world.”  John Elstad, Senior VP of Legal-Editorial Operations, seemed to go a little further in his comments than TR Legal usually does when discussing the work performed at its off-shore operations by saying that they don’t just gather data, but analyze the data and “add value to it.”

It seems that legal editorial work has gone the way of manufacturing and is making its way out of the United States and off to India and the Philippines. Again, not a shocking statement… we’ve all watched this trickle away for years now. This is just one more chapter in the ever shrinking legal publishing market, and the race to find the cheapest labor pool. Perhaps the good new will be that will all the savings that TR Legal is getting through moving positions overseas, perhaps we’ll see a drop in the price of their products?? If not, then how are we, the customer benefiting??

This week has seen a great string of blog posts that discuss the relationship between Librarians and Knowledge Management professionals. I’m going to give you a reading list below (read them throughly, there will be a test!). As I read through these posts, a slightly morphed quote from Will Rogers kept popping into my head… “I’m not part of any organized profession. I am a Law Librarian.” Let’s face it, the term “Librarian” can bring up a range of legitimate categories that others place us in…  from “book shelvers” to “catalogers” to “researchers” to “collection development’ers'” along with a dozen or more other categories. As Mary Abraham states, “Consider that 25 years ago, an information professional was a librarian and during the last 15 years, knowledge managers have become the information professionals du jour.”

The title of “Information Professional” or “Knowledge Worker” is no longer owned by the library, and I think this frustrates a lot of librarians (myself included) whose talents for managing information bleeds over into the area of what is perceived now as Knowledge Management. The area that Nick Milton’s graph identifies as the “Explicit Knowledge” (that information that is created and organized within the firm) is where the battle seems to be taking place. But, I agree whole-heartedly with Nick and Nina Platt that KM and Libraries either stand together with a common goal and take advantage of the talents we each bring to the table, or we all get marginalized.

KM and Librarians are all under the pressure of “taking the human out of the process.” The biggest strengths for both of us is the human analysis we bring to what we do. Many of the powers-that-be think that they can slap a Google Search Engine on some huge internal database and magically organize all the data that flows in and out of the firm. Both KM and Librarians are walking on the edge of a very sharp sword where we have to increase the efficiency and effectiveness of how we organize and manage information (external and internal), while at the same time being asked to look for ways that automation basically reduces the number of people we need to do our jobs. That’s a tough job to do when you’re working together… fighting over that sliver of turf in the middle makes it that much harder.

Reading List:

  • Reflection on KM and Libraries in Law Firms
    When the library is under the KM folks, the library tends to be marginalized.
  • Librarians vs Knowledge Managers?
    How much [library marginalization] was due to difficult personalities or bad management?
    Is there something in the law firm “caste system” that makes it challenging for lawyers and non-lawyers to work together?
    Do librarians respond differently than knowledge managers? If so, is this due to personality type or training?
  • KM and Content Management, The Turf War
    Either [KM & Libraries] sit in one team…or we have two teams but with a common framework and aligned strategies. We don’t fight each other, as this puts both content management and KM equally at risk.
  • Content Catalysts
    [I]n an effort to shift the conversation, I’d propose to expand the roles available for information professionals.   What if we were to add a new category:  Content Catalysts?
  • Musings on the Librarian’s Role in Knowledge Management in Law Firms
    I have always said that librarians will be employed in law firms for a long time to come and have never been too concerned with those who have been painting a darker picture.  Lately, I’ve been doubting my stand on this topic and have been become more and more concerned with our future.
  • Catalog Content Not People
    At the end of the day, it’s critical to know what work needs to be done and then assign the right people to the task based on their talent, experience, temperament and inclination.  That is a far better approach than to match people to tasks on the basis of labels or stereotypes.
  • Knowledge Managers, Librarians, Practice Support, and Business Analysis
    My guess is that in a decade, BigLaw will have more clearly defined business process experts and analysts and a range of practice support professionals. Some of the them will do KM and library work; some will be KM professionals or librarians.

A couple weeks ago, Bob Ambrogi (who has a great looking new site, by the way) reviewed Paper.li, a resource that creates a newspaper-like result out of specific Twitter accounts. Paper.li, or “Daily on Twitter” as they call it, does some pretty cool things, including automatically categorizing tweets into topics (Technology, Travel, Health, Crime, etc.) The resulting page also has embedded video and pictures, which partially satisfied my need for “The Daily Prophet” type interaction. I have to say that I really like what I’ve seen so far, and have a few “advanced features” that you might want to test out for yourself.

About six months ago, we reviewed another Twitter-To-Newspaper site called Twitter Times. I still use it almost everyday in order to catch up with those folks out there that I follow. Right off the bat, however, I noticed that Paper.li offered some advanced features that Twitter Times doesn’t (create a paper based on a hashtag “#” for example).

Make Use of the Hard Work of Others (The Work Smarter, Not Harder Approach)

First of all, you can “Daily on Twitter” someone else account. Why would you want a “Daily on Twitter” of someone else’s Twitter account? One obvious reason is that there a some people out there that have a very focused use of Twitter.  Say they only follow what Law Firms are tweeting; or the only follow topics of politics; or they only follow issues like technology or health. With Paper.li, you can take advantage of all their hard efforts and have a daily synopsis of what issues they are discussing or reading.  Let me give you an example of how this feature would work using the topic of “Health”.

The first thing I’d want to do is look at Paper.li’s “Health Topic” page to see who the “big players” are that already have a “Daily on Twitter” set up. Right off the bat, I found someone that fits the profile I’m looking for by the twitter name of @hxjournprof.

I click on her “Daily on Twitter” feed, and I narrow that down even more by going to the “Health” section of the paper and clicking the “Health” link to take me directly to the health section.  Right away I see this is a gold mine of Health Topic information and I book mark this page to return to later. If I wanted to, I could actually have Paper.li send me an email notification (via the “notify me” link) letting me know when the page has been updated (usually every 24 hours).

How great is that??  I’ve just taken advantage of all the work that an expert in this particular topic has compiled (hope you didn’t mind, Christy!!), and now I have a quick and easy way of keeping up with all that information in one handy place! I think my Dad calls this the “work smarter, not harder” technique. One thing to remember is that the topics are limited, and are automatically generated.  This means that you don’t have a great amount of flexibility, and things tend to get mis-labeled based on the limitations of Paper.li’s taxonomy algorithm.

Create a Newspaper Focused on Particular Twitter Accounts


This approach is something that can be really useful if you set it up correctly. Let’s say that you want to create a Daily on Twitter newspaper based solely on law firms that use Twitter. What I did was set up a separate Twitter account (@amlaw100) and followed a bunch of active law firm twitter accounts. I cheated by going to some twitter lists that I knew of, and just went through and followed the active firms. Within a few minutes, I had about 70 firms that I was following. Then I went back to Paper.li and created a “Daily on Twitter” of law firms. Easy as pie! Now I have a single page I can go to and easily read what the law firms are tweeting about. It’s a nice looking format, and I can share it with others if I wanted… like I’m sharing it with you right now!!

Limits of Paper.li

  • Paper.li is still in Alpha testing, so they could actually pull this at any time, or completely re-write how they set up the results. So don’t get upset if either of these happen, as that’s part of “Alpha testing”. 
  • You’re limited to 3 “Daily on Twitter” papers that you can create. This is based on you giving Paper.li access to your Twitter account… if you have more than one Twitter account, each one can have up to three.
  • Paper.li cannot index “private” Twitter accounts (make sense to me.)
  • Topics are limited and controlled by Paper.li
  • Results are automatically indexed under topics based on Paper.li’s taxonomy, and a lot of results can be mis-labeled, or simply not placed under a topic at all.
Even with all of these limitations, Paper.li definitely has some use for people that like their information in an easy-to-read and easy-to-access format. I highly recommend that you go give it a test drive and see if it is something that you find as useful as I do.

One of the big questions that rolled around in my head about WilmerHale’s centralization of their Administrative Departments into one Ohio office was “How can they afford to move all these people and relocate to a place where they don’t have an existing office??”  Well, it turns out that the State of Ohio, Montgomery County, and the city of Kettering are laying out huge cash grants and tax credits to lure WilmerHale to the Dayton suburb.  According to the Manufacturers Group Inc.:

(WilmerHale) has been awarded a 65 percent job creation tax credit for an eight-year term as a result of the company’s project in the City of Kettering (Montgomery County). The value of the tax credit is estimated at $1,456,570 over the term, and the company would be required to maintain operations at the project site for at least 11 years. WilmerHale has more than 1,000 lawyers, with offices in 12 cities in the United States, Europe, and Asia. WilmerHale provides legal representation across a comprehensive range of practice areas that are critical to the success of its clients. This $3.4 million project is expected to create 187 jobs. (emphasis added)

The Springfield News-Sun also mentioned the large cash and tax incentives that WilmerHale got for moving its folks from New York, Boston and Washington DC:

There was also a list of financial incentives, most significantly a $1.46 million job creation tax credit approved Monday, April 26, by the Ohio Tax Credit Authority.

The Montgomery County Commission approved a $250,000 economic development grant April 20, and the city of Kettering and Miami Valley Research Foundation each pledged $500,000 in support. (emphasis added)

I’ve actually got to tip my hat to the WilmerHale partners like Jay Westcott for taking advantage of a down economy and governments that are willing to pay you to move to their towns. According to the Springfield News-Sun, Westcott looked at 32 cities for the centralization and the Dayton suburb apparently struck the right deal with the firm.  Westcott said, “Of all the places we looked, this was the place we were most comfortable, that had a strong labor pool and really a very cooperative group of people who worked with us.”

In an area that has businesses like LexisNexis, NCR there has to be a great labor pool.  I’m sure that the fact that their moving into the old Deloitte Consulting offices along with a few million dollars in grants and tax incentives made the move a no-brainer.

Everyone knows that BigLaw is notorious for being a “monkey-see, monkey-do” industry. If WilmerHale shows that local governments are willing to pony up millions of dollars for a couple hundred jobs, then it can be assumed that more firms will start to centralized their operations. Firms will no longer need to house administrative employees in Class-A real estate offices in high-cost cities.  Soon you might find that many of your IT or Accounting staff is located in cities like Kettering, Ohio, or Tupelo, Mississippi, or Lincoln, Nebraska. Places where economic times are tough and the states are betting that paying millions for a few hundred jobs now can help their struggling economies rebound out of the current recession.

The WilmerHale deal is for ten years.  This makes me think of those Wal-Mart incentives that cities give for a few years, and then after they expire Wal-Mart looks to the next city for another deal and leaves the initial town with an empty building.  Perhaps firms can leverage these few hundred jobs every few years and find local governments willing to pay them to come to town. Get ready to ‘centralize’!!

I ran across a great article this morning which stresses how “Emotional intelligence is the new benchmark to a successful legal career.”  Alison Bernard and Niki Kopsidas of Fried Frank collaborated on the article “How High Is Your ‘EI’?” in the New York Law Journal’s “Special Report: Law Schools“. Bernard and Kopsidas lay out a path for law students to follow to help them traverse the additional elements that law firms are now looking for in their incoming associates. Firms are starting to look beyond a high class ranking at an Ivy League law school when looking at candidates.

To be a successful attorney in this economy, it is imperative to not only be an expert in a legal field, but to also offer superlative client service and maintain client relationships.

The article goes on to discuss what law firm recruiters need to start focusing on when interviewing candidates.  Grades and pedigree are starters, but other factors such as “social and emotional competencies… being flexible, adaptable, creative, empathetic, self-aware, optimistic, confident and self-motivated, and the ability to persevere, exert self-control, display good judgment, influence and get along with others” are critical to seeing the candidate’s potential.

Skipping over the what do to during interviews and while in law school sections, I liked how the article finished on what associates need to focus on when they actually start working. There are a number of opportunities for new lawyers to work on their ‘hard skills’ through the firm’s professional development training in order to learn the “practicing law” part of the job (although as we mentioned this week, sometimes a little ‘retraining’ needs to take place). Bernard and Kopsidas stress that new associates should also work to develop those “soft skills” that “cover how to be a professional at a client service organization.”

I’d argue that many firms don’t stress “hard” or “soft” skills enough. Many times it seems that the process of training is to push associates into the deep end of the pool and expect them to start swimming. Other professional services, such as the big four accountant firms, have training that goes on for weeks before they allow their new employees to start working on their clients’ matters. Perhaps this model should start working its way over from the BigFour to BigLaw.

Even though this article was written from the perspective of a law firm Director of Attorney Development and a Director of Legal Recruitment, you could apply most of the ideas across almost any industry that provides a service to its customer.

The Official Google Blog mentioned that they are bringing one of their features out of the shadows in order to help searchers find sites that are related to those in the search result. According to the post, Google has actually:

offered a “Similar” feature on results for a while now as a way to discover new, useful sites, but it hasn’t been too visible. Since we’ve been continuously improving this feature and we think it’s really useful, we’re now going to start showing these alternative sites more prominently. Starting this week, for queries where similar sites are likely to be helpful, we’ll display a list of “Pages similar” at the bottom of the results page.

So when you do a search now, some of your results will now have a “Similar” link next to the handy “Cached” link.

The current search is then re-ran and sites with similar content are supposed to appear.  I tested it out briefly this morning and liked what I saw.
For those of us “advanced” searchers, we can manipulate what Google’s doing here to help in other ways.  Say for example that you want to find sites that are “Similar” to 3 Geeks…  simply type in this search:

related:geeklawblog.com

The resulting search will show you other blogs that have similar content to us. This type of searching can be helpful for Competitive Intelligence Analysts that find unique websites and want to see others that are like it… or are looking for competitors of a certain company.  For example, if I type in “related:dlapiper.com“, I get a listing of other BigLaw firms.  If I type in “related:westlaw.com“, I get a list of legal research websites… and so on, and so on.
This is a pretty useful option that Google is giving a second chance. If you’re wanting to find your website’s relations, then the “related:” option from Google is something you’ll want to test out.

Very interesting press release from WilmerHale yesterday announcing that this September they are opening a 187 employee “Business Service Center” in Dayton, Ohio. WilmerHale is moving existing employees from their current offices (along with some new hires) to handle the administrative support functions for the following areas:

  • Finance
  • Human Resources
  • Information Technology
  • Operations
  • Document Review and Management
  • Practice Management
The idea behind the centralization is to “provide improved efficiencies for administrative teams and the firm, and reduce significant operational expenses.” 
I did notice that other departments — Library, Knowledge Management, Marketing, Business Development to name a few– missed the cut to be included in this consolidation of administrative functions. At least they missed it this time around. It makes me think whether these departments could actually work under a centralized method that is outside any of the actual offices that house lawyers??  Quite frankly, I can see a strong argument for both sides. In fact, I wouldn’t be surprised to see some of these WilmerHale departments eventually winding up in Dayton.
I do have one suggestion for WilmerHale to rethink the name they’ve given to this centralization project…  don’t be surprised if those that you’re asking to relocate, or those attorneys that have to deal with the logistics of a remote staff end up calling the “Business Service Center”, the “BS Center”.  
[Update 4/28]
According to the Springfield (Ohio) News-Sun, WilmerHale was offered a $1.46 million job creation tax credit, and there will be $1.25 in City and County “economic development grants” to support this move.
That answers the “how can they afford to move so many people” question…
The new WilmerHale Business Services Center facility is actually in Kettering and previously housed Deloitte Consulting.

After seeing and hearing too many fee discussions about discounts – a new thought clicked in my head. Clients are negotiating on discounts, not rates. The actual rates might matter with a wide a variation, but in most circumstances when clients push on law firms, it’s not on the absolute rates, but instead it’s about how big is the discount.
Upon reflection, there is a logic of sorts to this method. In-house counsel get pressure from management to cut legal fees. The simplest, most direct and seemingly logical message to bring back to management: We increased the discount by X% (which might be interpreted as – our legal fees will go down by X% this year).
The problem is – you can’t and shouldn’t make that leap of faith about savings . Even if the client/in-house lawyer keeps a close tab on hours billed (not the highest value task IMHO), then the absolute rate is what should matter – not the discount.
My suggestion to clients: If you want to maximize the return on your efforts with hourly billing, instead of talking discounts, focus your negotiations on rates.