Tomorrow’s [in-house] lawyers

Tomorrow’s [in-house] lawyers
While in London, England, last week, I had the privilege of attending a party to celebrate the launch of Tomorrow’s Lawyers, the fascinating new book by Richard Susskind. I fully anticipate this book — like its predecessor The End of Lawyers? —will stimulate much debate in the legal community. David Allgood, executive vice president and general counsel of the Royal Bank of Canada, calls it, “A must-read for anyone interested in the future of legal services.” I found it especially valuable as I work on a research project for the Association of Corporate Counsel to identify skill sets for the GC of the future.

The book has three parts:
•    a synopsis of the key drivers of change and their impact on the legal marketplace;
•    a description of the legal landscape of the future and its impact on law firms and in-house lawyers;
•    and the future for aspiring lawyers and how they might prepare.

There is more than I can cover in this column so I will focus on the points most relevant for in-house lawyers.

Susskind describes the three primary drivers of change: the push to do “more with less” and the pressure on in-house counsel to cut legal spend as well as reduce head count; the “liberalization” of the profession and the entrance of new competitors (all legal work need not be done by lawyers or law firms); and information technology that enables systemization as well as retrieval and analysis that leads to fundamental changes in how we work.

Susskind says the cost of legal services is too high (no dispute there). More tellingly, he goes on to assert the push to reduce costs through the use of RFPs and alternative fee arrangements does not seem to be yielding the significant savings sought by clients. They are delivering about 10 per cent at best.

He contends it is time for in-house counsel to “work differently” rather than to continue the “misguided” debate about hourly billing. He believes all legal work, both litigation and transactional, can be broken into segments and “decomposed” into a set of constituent tasks.

Then the issue becomes who is best suited to handle each task; and, according to Susskind, much of this work can be assigned to individuals and vendors (other than lawyers and law firms) or be undertaken by technology and computers.

Susskind suggests two winning strategies— what he calls the “efficiency strategy” and the “collaboration strategy.” The first seeks to reduce costs through identifying work that can be routinized and undertaken by lower-cost personnel or by computers. The second encourages clients to come together and share costs.

While it is difficult to generalize about in-house lawyers given the distinctions between companies in terms of revenues, industry, size of department, scope of regulation, and culture, I believe Susskind’s description of the changes in the legal market and its impact on the role of the in-house lawyer in the future to be right on target.

The skill sets in-house lawyers need to survive and implement new strategies likely will change as well. According to Susskind these skills will include:

•    Legal risk management, which should be a core competence of in-house lawyers, who will have to be increasingly systematic and rigorous with sophisticated tools and techniques;
•    Willingness to be more demanding on costs and selective about relationships with their firms;
•    Legal process analysis and management, i.e., the ability to decompose legal services, assign the tasks to those best able to complete (“horses for courses”), and put it all back together again and manage the entire process.

He also notes that while many general counsel have been unduly tentative in their demands for meaningful change by their law firms, “if and when GCs become radically more demanding, they will have it within their power to . . . redefine the entire legal marketplace.”

Susskind has a knack for taking complex and complicated issues and making them simple and easy to understand. He has a clear message for in-house lawyers: the legal world is changing; law firms are changing; and law departments must change as well.

“The genuinely expert and trusted in-house legal adviser, who lives and breathes the business, should always be an invaluable resource, but unless GCs are also prepared to drive the efficiency and collaboration strategies within their own departments and across law firms as well as other providers that serve them, then their future is far from clear. I advise in-house lawyers not to wait until their platform is burning. Now is the time to prepare for the challenge.”

This book is worth reading — it will make you think. And, hopefully help you prepare for the future. After all, law departments must adapt to the changes going on around us.

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