Large Firms Resisting Change?

As readers of this blog know, much of our focus is on emerging trends in the legal profession. And, at this juncture in time, most observers agree that the profession is in the midst of some profound changes in the business of law.

A flattening, global market; legal process outsourcing; captive offshore legal departments, virtual attorneys and virtual associates; web based legal products; evolving business and billing models; and the U.K.'s Legal Services Act 2007 are just a handful of emerging trends adding new colors to the legal canvass.

However, a recent study indicates that for all the talk and analysis, there may be significantly less change or innovation taking place in large firms. At least significantly less than GC's would like.

As reported this month at law.com, a survey released a few weeks ago by Altman Weil had this to say about General Counsels' opinions regarding the large firms with whom they work:

"75 percent of the responding chief legal officers rated their law firms between zero to four on a 10-point scale, indicating their opinion that firms had little or no interest in change. Only 5 percent of the respondents ranked their outside law firms between eight to 10, with 20 percent falling somewhere in the middle.

"This is a dramatic vote of no confidence from chief legal officers," Altman Weil Principal Daniel J. DiLucchio Jr. said in a statement. "Either many law firms just don't understand that clients today expect greater value and predictability in staffing and pricing legal work, or firms are failing to adequately communicate their understanding and willingness to make real change. In either case, it's a big problem."

This perception on behalf of GC's comes after more than 60% of respondents reported putting legitimate, non-negligible pressure on their law firms to change their value proposition.

So, given what appears to be some dissatisfaction in the degree of change being offered by large firms, it can't be encouraging for these firms to know that the survey also reported that 40% of GC respondents expect to give less work to outside firms this year.

To put that number in perspective, from 2000 through 2007, that expectation never surpassed 20%. Now, in a matter of two years, the expectation to give less work to outside firms has doubled.

While this may simply be a temporary blip fueled by the sour economy, history tells us that this window of time may well see some alternative models take hold that will provide GC's with the evolution they are seeking.