Monday, June 06, 2011

The rat race has ended …. (well there are alternatives)


Lawyers today have an option, to work at top law firms, have lower billable hour targets, have a life and opt out of the rat race. A recent article in the New York Times highlighted how large law firms have been setting up operations in lower cost semi-urban centers across the States for lawyers who can apply for a ‘career associate’ position. The career associate position will accommodate lawyers who will take on a lower billable hour target and never get on the partner track.

Law firms today are morphing (finally) into how successful corporations operate. There are a few who can bring in the business, manage the firm and perform at the executive level. There are others who are content to practice their profession and don’t require the i-need-to-be-a-partner aspiration as a prerequisite.

This model has some clear advantages. This alleviates the reverse pyramid effect that plagues many midsized law firms where the number of partners to associates tends to grow, having more and more partners do a lot of the work, affect client acquisition and retention and leading to an eventual implosion of the law firm .

The downside to all of this, lower pay grades for career associates, which directly affects the attorney’s ability to service the large law school loans they usually inherit with the degree. Maybe it’s time that law schools reassess their fee structures and look at ways to reduce the cost it takes to become an attorney.

So the market continues to change with law firms reducing billable rates, alternative and flat fee billing arrangements, career associate positions being introduced, legal outsourcing and technology, all playing influential roles in shaping the future of the legal industry. It will be interesting to see how quickly, if at all, a highly insulated industry reacts to the market pressures being put on it and if it has the wherewithal to transform into a lean efficient and effective machine.

No comments: