Byte of Prevention Blog

by Jay Reeves |

Legal Prognosticators See Turmoil in 2017

crystal ballThe start of a new year means it’s time to dust off the crystal ball and see what’s in store for the legal profession in 2017.

For that, we turn to the ABA, which convened a panel of law practice experts to predict trends for the coming year. The group included practicing attorneys, law school deans, tech professionals and corporate counsel.

Following are some of their observations.

Clients and Practice Trends

  • Expect turmoil. “We’re experiencing a destabilization of the relationship between law firms and clients,” says legal marketing guru Jordan Furlong of Law21. “What previously was a relatively simple, straightforward market is now more complicated. Law departments are keeping more work for themselves that they once routinely sent out to law firms. We hear a lot about AI in the law; maybe 85 to 90 percent of it is hype, but the remaining 10 to 15 percent is real and will have a revolutionary impact.”
  • Clients will choose competence over cost. “Based on what we saw in 2016, we expect to see companies prioritizing the legal ability of the law firm when choosing counsel and making the cost of an actual project slightly less of a priority,” says Joshua Rothman, partner at Fitzpatrick, Cella, Harper & Scinto of New York. “We see companies that are less likely to go with the lowest bid without carefully considering the best fit for the work.”
  • Dare to be different. Firms that try to differentiate themselves in creative ways will thrive. Those that merely offer cheaper rates will not.
  • The playing field will continue to expand. Legal services will be offered by different types of providers. Lawyers and law firms are no longer the only game in town.
  • Global uncertainty will drive business uncertainty. “With all of that policy uncertainty, I think general counsel and in-house legal teams will have, more than ever before, an important role in advising leadership teams and boards of directors,” says Tony Gomes of Citrix Systems. “So more than ever before, I think we will be called upon to look around the corner, monitor policy developments on a global basis, and apply that to the company’s business.”
  • A sense of urgency is required. “Demand has been flat or declining at large commercial firms for the last 10 years,” says Furlong. “We have substantial cohorts, year after year, of unemployed or underemployed new lawyers who nine months after graduation struggle to find full-time legal work. My message to law firms is, ‘What you’ve been doing in the past is not going to work very well in the future.’”

Law Schools and Legal Education

  • Fewer law graduates will enter the marketplace. The graduating class of 2017 from ABA-accredited schools will likely be the lowest since 1978. That number will be even lower in 2018. “[W]e have a massive contraction taking place,” says Bill Henderson, professor of law at Indiana University. “Although we have the same amount of graduates we had 40 years ago from accredited law schools, we have about 40 more schools. The average entering class has gone from 260 to 182, which leads to a lot of high fixed costs spread over a larger number of a law schools giving them a higher cost rate. One of the reasons law schools are struggling is because the ratio of entering salary to debt has almost doubled since 2000, so the starting salary has basically remained constant, but the actual debt load has continued to increase.”
  • Career services will have to become more creative. “We need to expand the type of legal jobs that are out there, not just focusing on the traditional law firm jobs, but the other jobs in security, compliance, and other areas where JDs are much more competitive,” says Ray English, assistant dean in the Career Office of Sandra Day O’Connor College of Law at Arizona State University.
  • The talented will always be able to find work. “[I]f you are a hardworking person who is open-minded and learning new technologies that have a customer focus, there is an organization for you,” says Henderson. “But it may be just a different organization than you are at now.”
  • Job hunting should begin early. Beginning in their first semester, law students should join professional associations and take advantage of networking opportunities. The key is to build collaborative relationships that will pay off at graduation.
  • Law schools need to get up to speed. Career services professionals will have to educate themselves about the changing legal market. They should be able to advise students on the pathways and skills needed to get the jobs they want. And they need to help their schools design curriculum to make sure students hit the ground running at graduation.

Technology and Data Security

  • Cybersecurity will dominate the headlines.  Legal administrators say this is the top operational challenge facing firms. “We need to deal with internal protection from cybersecurity threats while continuing to offer our trainees and staff the flexibility of mobility,” says Laura Broomell, President of the Association of Legal Administrators. “We also have more and more client requests for security and operational audits, and so we need to figure out how to do that efficiently with minimal cost.”
  • Staying current on cyber-safety standards will be challenging. “There is a major transformation taking place in IT right now, with organizations moving to the cloud,” says Kate Holmes, managing director of FTI Technology. How firms store and manage confidential information will be a top concern of clients and counsel alike. Different types of data may require different treatment.
  • Say yes to tech developments. “The number one thing I tell my team, and the perspective I share with my peers, is that you just have to embrace this,” says Gomes. “The world isn’t going back, and it’s going to be the teams, the companies, the law firms and the service providers that embrace this new paradigm while still being able to make a profit that are going to survive.”

Take hope. The more things change, the more they stay the same. All the experts agree on one point: those lawyers who focus on the fundamentals of providing superior, committed service to their clients will enjoy a happy and prosperous 2017.

Sources:

About the Author

Jay Reeves

jay.reeves@ymail.com | 919-619-2441

Jay Reeves practiced law in North Carolina and South Carolina. Over the course of his 35-year career he was a solo practitioner, corporate lawyer, legal editor, Legal Aid staff attorney and insurance risk manager. Today he helps lawyers and firms put more mojo in their practice through marketing, work-life balance and reclaiming passion for what they do. He is available for consultations, retreats and presentations.

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