tag:blogger.com,1999:blog-73736573160281988372024-03-05T20:07:23.098-06:00Law Firm Competitive IntelligenceObservations, experiences, and questions about law firm competitive intelligenceAnn Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.comBlogger47125tag:blogger.com,1999:blog-7373657316028198837.post-48807104242488077942013-10-07T09:47:00.000-05:002013-10-07T09:47:21.721-05:00The Future of Legal Services from the Buyers' Viewpoint<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;"><br /></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">On Friday, October 4, 2013, I
presented a TED-style talk at the </span><a href="http://collegeoflpm.org/meetings/2013-futures-conference/"><span style="font-family: Verdana, sans-serif;">2013 Futures
Conference</span></a><span style="font-family: Verdana, sans-serif;"> presented by the </span><a href="http://collegeoflpm.org/"><span style="font-family: Verdana, sans-serif;">College of Law Practice
Management</span></a><span style="font-family: Verdana, sans-serif;"> and </span><a href="http://www.kentlaw.iit.edu/"><span style="font-family: Verdana, sans-serif;">Chicago-Kent School
of Law</span></a><span style="font-family: Verdana, sans-serif;">. As a Fellow of CoLPM, I
treasure these annual meetings with other veterans of legal practice,
management, marketing and technology. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">This year, I was invited to
speak on the topic of this blog—specifically about the global megatrends and
other forces that will change global society and business over the next 15-20
years. These trends and forces will impact every market and industry the legal services
industry serves. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">I’ve blogged briefly about
these trends before and about the </span><a href="http://www.lawfirmci.blogspot.com/2013/03/global-trends-2030-released-by-nic.html"><span style="font-family: Verdana, sans-serif;">December 2012
report</span></a><span style="font-family: Verdana, sans-serif;"> <i>Global Trends 2030</i> published by the </span><a href="http://www.dni.gov/index.php/about/organization/national-intelligence-council-who-we-are"><span style="font-family: Verdana, sans-serif;">National
Intelligence Council</span></a><span style="font-family: Verdana, sans-serif;">. This speech was a chance for
me to explore these issues more deeply and share my thoughts with colleagues. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">After my speech, the
conference’s 120 attendees divided into roundtables and made some projections
about the markets, legal needs and buyers of a dozen industries that law firms, legal process outsourcing companies, and
other legal vendors serve. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">Then we reconvened and
debriefed about several industries the groups had considered. It was an
enlightening and entertaining session, although you’d have had to be present to
appreciate how much we enjoyed ourselves.
<o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">This type of conference format—1)
keynote, 2) TED talks, 3) roundtable breakouts, and 4) plenary debriefs proved to
be a successful model for other gatherings that smart people attend who want to tap
the experience and knowledge of everyone present. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">You can find a .pdf version of
the full speech text and slides </span><a href="http://collegeoflpm.org/wp-content/uploads/2013/10/SPEECH-AND-SLIDES-The-Future-of-Legal-Services-from-the-Buyers-Viewpoint-CoLPM-Ann-Lee-Gibson-October-2013.pdf"><span style="font-family: Verdana, sans-serif;">here</span></a><span style="font-family: Verdana, sans-serif;">. A link to a video recording of my TED talk
(without the slides) can be found </span><a href="http://collegeoflpm.org/futures-conference-october-4-5-2013-live-webcast/"><span style="font-family: Verdana, sans-serif;">here</span></a><span style="font-family: Verdana, sans-serif;">
(speech starts 6:00 minutes into the video). I can’t guarantee how long the
video link will be live. <o:p></o:p></span></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
<div style="margin-bottom: .0001pt; margin: 0in;">
<span style="font-family: Verdana, sans-serif;">Please feel free to share this speech with
others or repurpose the content in any ways that benefit you. You also have my permission to deliver the
speech yourself to other audiences. I’ll
even send you the actual PowerPoint slide deck if you like. <o:p></o:p></span></div>
<br />
<div style="margin-bottom: .0001pt; margin: 0in;">
<br /></div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com35tag:blogger.com,1999:blog-7373657316028198837.post-60516815637806301192013-07-30T17:10:00.000-05:002013-10-07T11:24:10.119-05:00Law in the Time of Ideology<br />
<span style="font-family: Verdana, sans-serif;">Lately, legal services pundits are finding more excoriation
than exceptionalism in the legal marketplace. Some believe <a href="http://www.slate.com/articles/news_and_politics/jurisprudence/2013/07/death_of_big_law_new_republic_s_claim_is_grossly_exaggerated.html"><span style="color: blue; font-family: Verdana, sans-serif;">BigLaw is dead, dying, or taking too long to die</span></a><span style="font-family: Verdana, sans-serif;">, while others say that’s </span><a href="http://www.slate.com/articles/news_and_politics/jurisprudence/2013/07/death_of_big_law_new_republic_s_claim_is_grossly_exaggerated.html"><span style="color: blue; font-family: Verdana, sans-serif;">crazy talk</span></a><span style="font-family: Verdana, sans-serif;">.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">In the meantime, angry bloggers are trying to ride law
schools out of town on rails.<span style="mso-spacerun: yes;"> </span>They protest
that law schools are too numerous, too expensive and too profitable. Schools are
accused of churning out too many lawyers who can’t find lawyer jobs and are
saddled with student loan debt they’ll have to repay by working at jobs where
they don’t need law degrees. <span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">One of the loudest Jeremiahs about failing law firms and law
schools is </span><a href="http://www.linkedin.com/profile/view?id=63634657&authType=NAME_SEARCH&authToken=Wloe&locale=en_US&srchid=174718131375118832305&srchindex=2&srchtotal=533&trk=vsrp_people_res_name&trkInfo=VSRPsearchId%3A174718131375118832305%2CVSRPtargetId%3A63634657%2CVSRPcmpt%3Aprimary"><span style="color: blue; font-family: Verdana, sans-serif;">Steven
Harper</span></a><span style="font-family: Verdana, sans-serif;"> who in 2008 left </span><a href="http://www.kirkland.com/"><span style="color: blue; font-family: Verdana, sans-serif;">Kirkland &
Ellis</span></a><span style="font-family: Verdana, sans-serif;"> where he had been a litigator for 30 years.<span style="mso-spacerun: yes;"> </span>Now retired from practicing law, he is one of
Northwestern Law School’s numerous adjunct professors (one of 235, to be
precise) and opines about how screwed up the legal profession is at his blog, </span><a href="http://thelawyerbubble.com/"><span style="color: blue; font-family: Verdana, sans-serif;">The Belly of the Beast</span></a><span style="font-family: Verdana, sans-serif;">, and in his latest
book, </span><a href="http://www.amazon.com/The-Lawyer-Bubble-Profession-Crisis/dp/0465058779"><i style="mso-bidi-font-style: normal;"><span style="color: blue; font-family: Verdana, sans-serif;">The Lawyer Bubble:<span style="mso-spacerun: yes;"> </span>A Profession in Crisis</span></i></a><span style="font-family: Verdana, sans-serif;">.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">From a different quarter comes a </span><a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2250585"><span style="color: blue; font-family: Verdana, sans-serif;">new study</span></a><span style="font-family: Verdana, sans-serif;">
by </span><a href="http://law.shu.edu/Faculty/fulltime_faculty/Michael-Simkovic.cfm"><span style="color: blue; font-family: Verdana, sans-serif;">Seton
Hall law school professor Michael Simkovic</span></a><span style="font-family: Verdana, sans-serif;"> and </span><a href="http://www.business.rutgers.edu/faculty-research/directory/mcintyre-frank"><span style="color: blue; font-family: Verdana, sans-serif;">Rutgers
B-school professor Frank McIntyre</span></a><span style="font-family: Verdana, sans-serif;"> who calculate the value of a law school education by
estimating that the pre-tax lifetime value of a law degree is, on average, $1 million.<span style="mso-spacerun: yes;"> </span>Support for this optimism comes from other academics,
including </span><a href="http://law.scu.edu/faculty/profile/diamond-stephen/"><span style="color: blue; font-family: Verdana, sans-serif;">Santa
Clara law professor Stephen Diamond</span></a><span style="font-family: Verdana, sans-serif;"> who defends the study in </span><a href="http://stephen-diamond.com/?p=4991http://stephen-diamond.com/?p=4991"><span style="color: blue; font-family: Verdana, sans-serif;">this
post</span></a><span style="font-family: Verdana, sans-serif;"> and elsewhere at his blog. <o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">In an </span><a href="http://www.americanlawyer.com/PubArticleALD.jsp?id=1202612503156&kw=A%20Dangerous%2C%20Million-Dollar%20Law%20School%20Distraction&et=editorial&bu=Law.com&cn=20130729&src=EMC-Email&pt=Newswire&slreturn=20130629081627"><span style="color: blue; font-family: Verdana, sans-serif;">Am
Law Daily</span></a><span style="font-family: Verdana, sans-serif;"><span class="MsoHyperlink"><u><span style="color: blue;"> column</span></u></span> earlier this week, Harper belittles
the Simkovic-McIntyre thesis, citing the “bimodal distribution of lawyer
income” as reason enough to ignore the study’s findings about averages.<span style="mso-spacerun: yes;"> </span>His bimodal objection references the reality
that law schools collectively graduate both higher-paid (BigLaw) lawyers and
lesser-paid ones who, I assume, practice at smaller firms or don’t practice law
at all.<span style="mso-spacerun: yes;"> </span>Harper also complains that
because Simkovic spent one year as a BigLaw associate at Davis Polk he surely
knows all of BigLaw associates’ complaints, but somehow still summoned the
temerity to investigate lawyers’ lifelong compensation—a complaint I readily admit
I don’t understand.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">And here, finally, is the actual point of this blog.<span style="mso-spacerun: yes;"> </span>Some time ago we arrived at the point where public
discussion about the changing nature of clients’ needs, financial and cultural
aspects of law firm models, lawyers’ pre- and in-service training, and new ways
to practice law in the digital age are immediately framed as smackdowns posing dichotomies
like:<span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-spacerun: yes;"><br /></span></span>
<em style="font-family: Verdana, sans-serif;">* BigLaw vs. Innovation</em></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<em style="font-family: Verdana;">* Law Schools: Evil or Just Stupid? </em><br />
<em style="font-family: Verdana;">* Why Don't Law School Gunners Just Kill Themselves Now Instead of Waiting Until They're Miserable BigLaw Partners? </em><br />
<em style="font-family: Verdana;"><br /></em>
<span style="font-family: Verdana, sans-serif;">After years of listening to these squabbles, I find
myself wishing debates were not dominated by snark and logical
fallacies.</span><span style="font-family: Verdana, sans-serif;">
</span><span style="font-family: Verdana, sans-serif;">I wish that more of us were able to acknowledge that we don’t have sufficient
information or intelligence to fiercely defend the win-lose
arguments that benefit us the most.</span><span style="font-family: Verdana, sans-serif;"> </span><span style="font-family: Verdana, sans-serif;">Certainly,
none of us can claim the perfect prescience to demand that everyone put all of </span><em style="font-family: Verdana, sans-serif;">their</em><span style="font-family: Verdana, sans-serif;">
eggs in </span><em style="font-family: Verdana, sans-serif;">our</em><span style="font-family: Verdana, sans-serif;"> favorite future scenario basket.</span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">Insufficiently explored in these squabbles is the extent to
which “the legal services industry” is really <i style="mso-bidi-font-style: normal;">multiple, diverse</i> markets.<span style="mso-spacerun: yes;"> </span>Each
market requires services from vendors with different key performance
indicators, different business models, and labor forces with different combinations
of training, skills and experience.<span style="mso-spacerun: yes;"> </span>The
inappropriateness of any single service model to serve <i style="mso-bidi-font-style: normal;">all</i> markets well does not invalidate that model for the markets it was
designed to serve.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">But one-size-fits-all ideologies and passions have come to dominate
what should be more reasoned discussions about our industry’s future.<span style="mso-spacerun: yes;"> </span>Ideologues describe each other as <i style="mso-bidi-font-style: normal;">disgruntled</i>, <i style="mso-bidi-font-style: normal;">disingenuous</i>, <i style="mso-bidi-font-style: normal;">disheartening</i>
and even <i style="mso-bidi-font-style: normal;">demented</i>.<span style="mso-spacerun: yes;"> </span>I find least helpful the commentators-for-a-day
who raisin-pick anecdotes and data to prop up their storylines.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">The loudest pundits have deep sunk costs they are unable to abandon.<span style="mso-spacerun: yes;"> </span>They have been highly rewarded or bitterly
punished (in terms of money, power and medals) by their own experiences, and
they’re taking it very personally.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">If you invite opinions about the future of law from BigLaw managing
partners, LPO CEOs, law school deans, consultants, senior partners and associates,
you can predict with nearly perfect accuracy how each of them sees the future of
our industry, depending on whether they got a raise and/or a bonus this year, have
thriving practices (or not), were just made partner or failed to make partner, were
recently de-equitized or recently escorted downstairs into unemployment.</span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
</div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">In fact, most of us with a dog in this hunt come
across like we should recuse ourselves from the conversation while cooler heads
grapple with the important issues.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-spacerun: yes;"><br /></span></span>
<span style="font-family: Verdana, sans-serif;">I also believe that most of us are ignoring two inconvenient
truths.</span><span style="font-family: Verdana, sans-serif;"> </span><span style="font-family: Verdana, sans-serif;">The first is that the practice
of law is inherently and highly competitive—intellectually, psychologically and
financially.</span><span style="font-family: Verdana, sans-serif;"> </span><span style="font-family: Verdana, sans-serif;">I don’t know how we can factor
competition out of the legal profession or the industry.</span><span style="font-family: Verdana, sans-serif;"> Put most bluntly, we cannot. </span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-spacerun: yes;"><br /></span></span>
<span style="font-family: Verdana, sans-serif;">The second inconvenient truth is that lawyers, as a group,
are psychologically unresilient—meaning that they find it hard to bounce back
after a loss or to tolerate change comfortably (see </span><a href="http://www.americanlawyer.com/PubArticleTAL.jsp?id=1202607833345&Time_for_The_Am_Law_200_to_Embrace_Testing_for_Talent"><span style="color: blue; font-family: Verdana, sans-serif;">“The
Case for Testing”</span></a><span style="font-family: Verdana, sans-serif;"> by </span><a href="http://www.alm.com/about/management-team"><span style="color: blue;"><span style="font-family: Verdana, sans-serif;"><i>American Lawyer</i> publisher Aric Press</span></span></a><span style="font-family: Verdana, sans-serif;">). </span><br />
<span style="font-family: Verdana, sans-serif;"><br /></span>
<span style="font-family: Verdana, sans-serif;">Put succinctly, we have a US legal services industry now worth
nearly $300 billion that’s in transition and that’s managed and staffed by a
preponderance of combative neurotics.</span><span style="font-family: Verdana, sans-serif;"> </span><span style="font-family: Verdana, sans-serif;">Given
this combination, we probably should not expect our industry’s transition to be
easy or pretty.</span><span style="font-family: Verdana, sans-serif;"> </span><br />
<span style="font-family: Verdana, sans-serif;"><br /></span>
<span style="font-family: Verdana, sans-serif;">Nonetheless, I hereby make a public mid-year’s resolution to
breathe more deeply when considering and discussing the future of the legal
services industry, to listen more carefully to all viewpoints, and to stop thinking
that those whose observations and conclusions differ from my own should DIAF.</span><span style="font-family: Verdana, sans-serif;"> </span></div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com17tag:blogger.com,1999:blog-7373657316028198837.post-91623206490961181452013-07-22T19:12:00.001-05:002013-09-04T14:15:21.355-05:00I'm Shocked, Shocked!<span style="font-family: Calibri;"><i style="mso-bidi-font-style: normal;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"><strong></strong></span></i></span><br />
<span style="font-family: Verdana, sans-serif;"><i style="mso-bidi-font-style: normal;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"><strong>The New Republic’s</strong></span></i><span lang="EN" style="color: #333333; mso-ansi-language: EN;"> <a href="http://www.newrepublic.com/article/113941/big-law-firms-trouble-when-money-dries"><span style="color: blue;">latest cover story</span></a>, “The Last Days of Big Law – You Can’t Imagine the Terror When
the Money Dries Up” by <strong>Noam Scheiber</strong>, is a dishy article about the international
law firm of <strong>Mayer Brown</strong>. The author recited some of Mayer Brown’s well known
management missteps over the last decade and cited numerous unnamed sources,
most of whom are former lawyers at the firm, to construct a parable of what’s
wrong with the rest of Big Law. <o:p></o:p></span></span><br />
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">For the record, I once
consulted with Mayer Brown and think highly of that firm and the leaders,
lawyers and marketers I worked with who are still there.</span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; mso-ansi-language: EN;"><span style="font-family: Verdana, sans-serif;">The author of <i style="mso-bidi-font-style: normal;">The New Republic</i> article looks down his
nose at Mayer Brown and, consequently, <strong>Big Law</strong> for (1) having too many lawyers,
(2) replacing expensive lawyers with cheaper lawyers, and (3) firing anyone
because there’s not enough work for them to do. He says he's shocked to discover that (4) Big Law is also Big Business, which those of us who work in and
for law firms have known for some time. Perhaps most amusingly, he is even more shocked to find that (5) lawyers are competitive creatures who are ideally educated
and trained to game every reward system ever built. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<iframe allowfullscreen="" frameborder="0" height="315" src="//www.youtube.com/embed/HMIyDf3gBoY?rel=0" width="420"></iframe><br /></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">The author employs the effective
journalistic techniques of card-stacking, false assumptions,
either-or-fallacies, false generalizations, etc. Given his skills, I’m
surprised he doesn’t do more political reporting. </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;">He appears either ignorant
or uncaring of any actual facts about the size of the corporate legal services
market and its recent- and long-term trends. However, he’s not alone in that
regard, since “The Sky Is Falling” still seems to be #1 on the “I Wonder if
Someone Will Pay Me to Write about Law Firms?” hit parade. </span><span lang="EN" style="color: #333333; mso-ansi-language: EN;">Here are just a
couple of <em>actual</em> facts:</span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">• In 2007, Am Law 100 total
revenue was $62.9 billion. In 2012, it had grown to $73.4 billion. Yes, some of
that was due to cross-border mergers. But most of it was not. </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">• By 2020, Global 500
revenue is predicted to double – from $30 trillion to $60 trillion. Call me
crazy, but the business, legal, political, demographic, and other changes that accompany
that growth will doubtless require some considerable, proportionate growth in
legal services. </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">(An aside to those who think
the above facts are misleading: If your own firm’s revenue is declining, then
the proper response might be to consider whether your firm is selling what
buyers <em>used</em> to buy, not what they’re buying now.) </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">I readily acknowledge that
my irritation with this article and similar ones I’ve read lately stems from my
long tenure in the legal services industry. I’ve been around law firms so long
now that, while I constantly see new things happening, I also see them as part
of longer-term patterns. For that reason, I suppose I’m less alarmed than
younger participants in this space. </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">All industries change – they
change a lot. And people adapt – so much better than you’d think they would.
There are always career casualties when big change comes. The resilient are
resilient. The unresilient are not. The popular theory that the legal
profession and the legal services industry don’t and won’t change is one that I
simply refuse to accept. I’ve seen firms, lawyers, leaders, and their business
advisors all change so much in the decades I’ve worked in this industry. The
future rewards – financial, intellectual, and otherwise – of adapting
successfully are too great to ignore. </span><o:p></o:p></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span lang="EN" style="color: #333333; font-family: Verdana, sans-serif; mso-ansi-language: EN;">Finally, I do get piqued by
those who randomly wander in from off the street and say: “Hey, I know somebody
who used to work in a law firm, and they hated it. You guys must all be
miserable, too!” When that happens, I think for a moment about how good it
would feel to toss my beer in his face. And then I smile and remember – that’s
why I don’t do PR for law firms.</span></div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com13tag:blogger.com,1999:blog-7373657316028198837.post-1323370803281670942013-03-22T09:46:00.000-05:002013-03-22T09:46:07.740-05:00You Know Your Firm’s in Serious Trouble When …
<br />
<span style="font-family: Verdana, sans-serif;">The only reason
for a law firm to invest in competitive intelligence is to help its decision
makers prepare to benefit from (or avoid the dangers in) near- and long-term opportunities
and threats. Therefore, among their other duties, CI professionals and their clients must track leading, lagging
and coincident indicators that identify specific opportunities and threats and that
forecast their timing. </span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<span style="font-family: Verdana, sans-serif;">Yes, the US
economy is recovering from the Great Recession. But like all downturns, it stressed
our industry. Some firms, more vulnerable than others, were tested hard. Happily,
some of those firms’ leaders took major corrective actions, and their firms are
emerging stronger than before. But some firms will not recover. </span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<span style="font-family: Verdana, sans-serif;">Below are 20
indicators that your firm—or a competitor firm—probably won’t make it, at least
not in its current incarnation. I thank my esteemed colleagues (you know who
you are) for suggesting some of these indicators.<span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: Verdana, sans-serif;">Twenty ways to know your firm’s in serious trouble
… <o:p></o:p></span></b></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">1.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>You dread coming to work. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">2.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>Partners’ doors are closed all the time. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">3.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><span style="mso-fareast-font-family: "Times New Roman";">The
coffee’s gotten worse. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">4.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>Firm revenue and headcount have shrunk, and net
operating income has fallen even more. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">5.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>Profits per equity partner are shrinking or flat,
kept aloft by partner de-equitizations. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">6.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>The only thing growing at your firm is the
number of non-equity partners. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">7.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>Women at your firm are third-class citizens, not
firm leaders or full equity partners. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">8.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span>You don’t recruit government officials without
business because you can’t afford to invest in them. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">9.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><span style="mso-fareast-font-family: "Times New Roman";">There’s
a big donut hole in your firm’s partnership, where future leaders used to be. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">10. </span></span>All the firm’s largest client relationships are
controlled (“tattooed”) by the firm’s oldest partners. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">11. </span></span><span style="mso-fareast-font-family: "Times New Roman";">Clients
are viewed primarily as revenue sources, not objects of real affection and
service. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">12. </span></span><span style="mso-fareast-font-family: "Times New Roman";">Partners
won't delegate work to other lawyers until they make their own production numbers.<o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">13. </span></span>Equity partner compensation is decided by a few
partners, black-box style. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">14. </span></span><span style="mso-fareast-font-family: "Times New Roman";">Your
firm has downsized marketing and eliminated the CMO position. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">15. </span></span><span style="mso-fareast-font-family: "Times New Roman";">You’re
still using MS Office 2003. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">16. </span></span><span style="mso-fareast-font-family: "Times New Roman";">You
haven’t had a real firm retreat in years.<o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">17. </span></span>Your firm has recently been sued for
malpractice, discrimination and/or sexual harassment. </span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">18. </span></span><span style="mso-fareast-font-family: "Times New Roman";">Clients
have started to ask you about the firm’s health. <o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">19. </span></span>You’re open to a combination, but “worthy”
firms’ leaders won’t take a meet and greet.<span style="mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">20. </span></span>You’ve finally started to say the M-word,
assuring reporters your firm is not interested in a merger.<span style="mso-fareast-font-family: "Times New Roman";"><o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<span style="mso-fareast-font-family: "Times New Roman";"><span style="font-family: Calibri;"><span style="font-family: Verdana, sans-serif;">What other leading, lagging
or coincident indicators do you think identify a law firm that’s in imminent
danger of failing?</span><span style="mso-spacerun: yes;"> </span></span></span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com19tag:blogger.com,1999:blog-7373657316028198837.post-74666614599848834932013-03-12T14:05:00.000-05:002013-03-12T14:24:19.371-05:00Global Trends 2030 Released by NIC<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Every
four or five years, the US National Intelligence Council (NIC) publishes a Global
Trends report. And now <i style="mso-bidi-font-style: normal;">Global Trends 2030</i>
has just been released. A short (5-page) briefing can be found <a href="http://www.dni.gov/files/documents/Interactive%20Le%20Menu.pdf"><span style="color: windowtext;">here</span></a>. The longer (160-page) report can be
downloaded in pdf, iPad and Kindle formats <a href="http://www.dni.gov/index.php/about/organization/national-intelligence-council-global-trends"><span style="color: windowtext;">here</span></a>. <o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">The
executive summary describes the NIC’s goals for this massive effort: <o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt 0.5in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">“</span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-Light;">This
report is intended to stimulate thinking about the rapid and vast geopolitical
changes characterizing the world today and possible global trajectories during
the next 15-20 years. As with the NIC’s previous Global Trends reports, we do
not seek to predict the future—which would be an impossible feat—but instead
provide a framework for thinking about possible futures and their implications.”</span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Since
the mid-1990s I’ve studied these Global Trends reports carefully, using them to
ground myself about changes I see in the economy, the legal industry, and my personal
investment options. Below are my very quick Cliffs Notes on this latest report.
<o:p></o:p></span></div>
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><o:p> </o:p></span><br />
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Global Megatrends <o:p></o:p></span></b></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">The
global megatrends (relative certainties) presented and discussed in the 2030 report
include: <o:p></o:p></span></div>
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span></i><br />
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Individual
empowerment<o:p></o:p></span></i><br />
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Rapidly
expanding middle class (for the first time, most of world’s population aren’t in
poverty)<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Life
expectancy increases rapidly, with deaths from communicable diseases dropping more
than 40% <o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Religious,
ethnic and national identities are strengthened<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">More
technological breakthroughs in information, communication, manufacturing, healthcare,
warcraft are great levelers for good and evil<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Individuals
and states experience greater stress levels<o:p></o:p></span></div>
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span></i><br />
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Diffusion
of power<o:p></o:p></span></i><br />
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Asia
surpasses North America and Europe in global economic power<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Power/impact
of Europe, Japan and Russia lessens<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">No
global hegemonic political power remains – regional conflicts and regional partnerships
are both possible<o:p></o:p></span></div>
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span></i><br />
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Demographic
patterns<o:p></o:p></span></i><br />
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">World
population becomes increasingly urbanized (from 50% to 60%), and urban
construction explodes<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Economic
growth may decline in demographically aging countries<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Youthful
countries are politically unstable (the “demographic arc of instability”)<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Global
migration and immigration increases<o:p></o:p></span></div>
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span></i><br />
<i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Food,
water, energy nexus<o:p></o:p></span></i><br />
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Huge
increases in demand for food (35%), water (40%) and energy (50%)<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Addressing
demands for each of these commodities is linked to supply and demand for the
others<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l0 level1 lfo1; text-indent: -0.25in;">
<span style="font-family: Symbol; font-size: 10pt; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Severe
weather patterns intensify – wet areas get wetter, dry areas get drier<o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span><br /></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Critical Game
Changers <o:p></o:p></span></b></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt; mso-layout-grid-align: none;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Garamond-Book;">The report posits six critical variables whose trajectories are
far less certain and are subject to control by state and non-state actors: <o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">1.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Crisis-prone global economy</span></i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will divergences and increased
volatility result in more global breakdown? Or will the development of multiple
growth centers lead to increased resiliency? <o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">2.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Governance gap</span></i><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will current forms of
governance and international institutions be able to adapt fast enough to
harness and channel change instead of being overwhelmed by it?<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">3.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Potential for increased
conflict</span></i><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will
rapid changes and shifts in power lead to conflicts?<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">4.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Wider scope of regional
instability</span></i><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will
regional instability, especially in the Middle East and South Asia, spill over
and create global insecurity?<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">5.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Impact of new technologies</span></i><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will technological
breakthroughs occur in time to solve the problems caused by rapid urbanization,
strain on natural resources, and climate change?<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l1 level1 lfo2; text-indent: -0.25in;">
<span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-bidi-font-weight: bold; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">6.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";">
</span></span></span><i style="mso-bidi-font-style: normal;"><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;">Role of the United States</span></i><span style="color: black; font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Univers-Bold; mso-bidi-font-weight: bold;"> - Will the US, as the
leading actor on the world stage and with its new energy independence, be able to
reinvent the international system, carving out potential new roles in an
expanded world order?<o:p></o:p></span></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt; mso-layout-grid-align: none;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span><br /></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Four Alternative
Worlds / Scenarios<o:p></o:p></span></b></div>
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">Like
the preceding global trends reports, the 2030 report includes four different
global 15-to-20-year scenarios for use by organizations that engage in scenario
planning. The four Alternative Worlds posited are: <o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l2 level1 lfo3; text-indent: -0.25in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">1.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique;">Stalled Engines</span></i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique; mso-bidi-font-style: italic;"> – In<i> </i></span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-Light;">the most
plausible worst-case scenario, the risks of interstate conflict increase. A
pandemic hits, the US draws inward, and globalization stalls.<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l2 level1 lfo3; text-indent: -0.25in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">2.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique;">Fusion</span></i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique; mso-bidi-font-style: italic;"> – </span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-Light;">In the most plausible best-case outcome,
China and the US collaborate on a range of issues, leading to broader global
cooperation.<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-layout-grid-align: none; mso-list: l2 level1 lfo3; text-indent: -0.25in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">3.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique;">Gini-Out-of-the-Bottle</span></i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique; mso-bidi-font-style: italic;"> – </span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-Light;">Inequalities explode
as some countries become big winners and others fail. Inequalities within
countries increase social tensions. Without completely disengaging, the US is
no longer the “global policeman.”<o:p></o:p></span></div>
<br />
<div class="MsoListParagraph" style="margin: 0in 0in 0pt 0.5in; mso-list: l2 level1 lfo3; text-indent: -0.25in;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Verdana; mso-fareast-font-family: Verdana;"><span style="mso-list: Ignore;">4.<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span></span><i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique;">Nonstate World</span></i><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-HeavyOblique; mso-bidi-font-style: italic;"> – </span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt; mso-bidi-font-family: Avenir-Light;">Driven by new
technologies, nonstate actors take the lead in confronting global challenges.</span><span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><o:p></o:p></span></div>
<br />
<br />
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><strong>What's Next?</strong></span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"></span> </div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;">I
know how full the days (and nights) of law firm CI professionals can be. However,
I hope you will find time to explore this new report. I also hope some of you
will comment about it. I’ll soon be posting more here about 16 disruptive
technologies, 8 possible black swan events, and other topics discussed in the <i style="mso-bidi-font-style: normal;">Global Trends</i> <em>2030 </em>report.</span></div>
<div class="MsoNormal" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif"; font-size: 10pt;"><o:p></o:p></span> </div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-45880470120863994572013-02-26T08:05:00.001-06:002013-02-26T08:18:36.056-06:00Hastening ZombieLaw’s Collapse—and Why That’s a Good Thing<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">Ignoring
the ballyhoo about “The New Normal” and the debate about whether this is BigLaw’s
end of days, most seem to agree that the US legal market is overcrowded. It
suffers from too many lawyers and law firms. <o:p></o:p></span><br />
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">Like many
aspects of our industry, market overcrowding is not new. For years, we have
watched some BigLaw firms stagger around zombie-like and refuse to die. They decline
in vigor and resort to bottom feeding and submitting low bids on every job in
town. Some of these ZombieLaws are highly leveraged affairs with shrunken
equity partner castes and even smaller star chambers that oversee closed
compensation systems. Other ZombieLaws are over-leveraged and offer a warm bunk
to lawyers with small books of business whom no one else will hire. <o:p></o:p></span></div>
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">The disappearance
of five such firms would blow fresh wind under the wings of fifty nearby firms
and lift them higher. I blogged about this in 2008 when I predicted Bay Area firms
would benefit from Thelen’s and Heller’s demises. (See <a href="http://lawfirmci.blogspot.com/2008/09/its-hard-to-accept-intelligence-that.html">"It's Hard to Accept Intelligence That Breaks Your Heart."</a>) Since then, the Boston and Atlanta legal markets have also benefitted
from regional right-sizing. The New York City market is right-sizing now,
albeit slowly. In several other overcrowded markets, a handful of firms are feeling
and causing each other’s pain. <o:p></o:p></span></div>
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">If I had
more resources right now, I would create two online prediction markets. (See <a href="http://www.intrade.com/v4/home/">Intrade</a>
for examples of such markets.) The first market would solicit bets on which US
law firms will <i style="mso-bidi-font-style: normal;">dissolve</i> by December 31,
2013. The second one would solicit bets on which firms will <i style="mso-bidi-font-style: normal;">merge</i> with one or more firms by the end
of the year. On January 1, 2014, I would close those markets, open two new ones,
and start all over again. <o:p></o:p></span></div>
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">If these
markets worked well—and I believe they would, by crowd-sourcing intelligence anonymously
from knowledgeable persons who will never go on the record—they would quickly and
accurately identify the weakest firms. And, yes, these prediction markets might
hasten their deaths. <o:p></o:p></span></div>
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">What a
mean thing to do, right? Wrong. It would be a kind thing to do. Depending on
your viewpoint, of course. <o:p></o:p></span></div>
<br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";">So how
about it—would you place anonymous bets on these two markets?<span style="mso-spacerun: yes;"> </span>Which geographic, practice and industry legal
markets do you see as the most crowded? Which firms would you bet will dissolve
or merge by December 31, 2013? </span></div>
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: "Verdana","sans-serif";"></span> </div>
</div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com1tag:blogger.com,1999:blog-7373657316028198837.post-238596157055498772013-02-18T15:43:00.000-06:002013-02-18T17:13:59.356-06:00Pulling Away from the Pack – or Powering with Arithmetic?<span style="font-family: Verdana, sans-serif;">Last Friday, <i style="mso-bidi-font-style: normal;"><a href="http://www.law.com/jsp/ca/index.jsp"><span style="color: blue;">The<span style="font-style: normal;"> </span>Recorder</span></a>
</i>published<i style="mso-bidi-font-style: normal;"> </i>an article about FY
2012 Am Law early results:<span style="mso-spacerun: yes;"> </span></span><span style="color: blue; font-family: Verdana, sans-serif;"><a href="http://www.law.com/jsp/ca/PubArticleCA.jsp?id=1202588541180">“Revenue Growth Modest at Many Firms, But Profits Surge.”</a></span><span style="font-family: Verdana, sans-serif;"><span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>Bylined
by </span><a href="http://www.linkedin.com/profile/view?id=73803943&authType=NAME_SEARCH&authToken=OuPO&locale=en_US&srchid=c9cb176f-5142-4aea-81e9-2482bca6d2dc-0&srchindex=2&srchtotal=110&goback=%2Efps_PBCK_*1_Julia_Love_*1_*1_*1_*1_*2_*1_Y_*1_*1_*1_false_1_R_*1_*51_*1_*51_"><span style="color: blue; font-family: Verdana, sans-serif;">Julia
Love</span></a><span style="font-family: Verdana, sans-serif;">, the article discussed several ways law firms can try to improve their
top line performance when revenue stalls, including thinning their ownership
ranks. <span style="mso-spacerun: yes;"> Three California firms whose FY2012 equity partnership ranks contracted and whose profits per equity partner (PPEP) showed double-digit increases were highlighted. </span></span><br />
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<strong><span style="font-family: Verdana, sans-serif;">Shrinking law firm ownership is an old tradition</span></strong></div>
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<strong></strong><span style="font-family: Verdana, sans-serif;"> </span></div>
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">The arithmetic potential to improve a firm’s PPEP by reducing the number of equity partners at
that firm is obvious and significant.<span style="mso-spacerun: yes;">
</span>But it’s far from a new trend.<span style="mso-spacerun: yes;"> </span>Firms have been thinning their ownership ranks for
over 20 years.<span style="mso-spacerun: yes;"> </span>In FY1990, Am Law
100 equity partners constituted <strong>32.8%</strong> of all Am Law 100 lawyers.<span style="mso-spacerun: yes;"> </span>By FY2000, that metric declined to <strong>27.5%</strong>.<span style="mso-spacerun: yes;"> </span>And by FY2011, it was down to <strong>22.3%</strong>.<span style="mso-spacerun: yes;"> </span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">As legal industry metric wonks know, Am Law’s leverage metric also
measures the extent of law firm ownership, but is calculated differently – as the
ratio of all non-owner lawyers to each owner lawyer (equity partner).<span style="mso-spacerun: yes;"> </span>In FY1990, the Am Law 100 collective leverage
was <strong>2.05 to 1</strong>.<span style="mso-spacerun: yes;"> </span>In FY2000, it was <strong>2.63 to
1</strong>.<span style="mso-spacerun: yes;"> </span>And in FY2011, it was <strong>3.49 to 1</strong>.<span style="mso-spacerun: yes;"> </span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<b style="mso-bidi-font-weight: normal;"><span style="font-family: Verdana, sans-serif;">How low will law firm equity
partnership ranks go?<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></b></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">I’ll confidently predict that if nothing happens to
modify this trend, by FY2020 equity partners will constitute no more than <strong>18%</strong>
of Am Law 100 lawyers.<span style="mso-spacerun: yes;"> </span>Stated another
way, in FY2020 the Am Law 100 lawyer population will have at least <strong>4.56</strong> non-owner
lawyers for every equity partner.<span style="mso-spacerun: yes;"> </span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">If those predictions take away your breath, consider the accounting firms: In FY2011, leverage at the Big Four
was already 10.6 to 1, as reported by </span><a href="http://accountingnewsreport.com/?p=268"><span style="color: blue; font-family: Verdana, sans-serif;">Accounting News Report</span></a><span style="font-family: Verdana, sans-serif;">.</span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;"><b style="mso-bidi-font-weight: normal;">Some uses of this competitive
intelligence</b><span style="mso-spacerun: yes;"> </span></span></div>
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Verdana, sans-serif;">As <span style="display: none; mso-hide: all;">ow iHow </span>you
absorb the above information and patterns, consider their import to your firm’s
and your competitors’ choices about growth, management and business development
models.<span style="mso-spacerun: yes;"> </span>For instance:<span style="mso-spacerun: yes;"> </span></span></div>
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">1.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>How will this continuing trend of shrinking firm
ownership affect your firm?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">2.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>How will this trend impact your firm’s efforts to
increase equity partner diversity?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">3.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>What unintended consequences might this trend precipitate?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">4.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>To what extent have specific firms’ PPEP been “enhanced”
through rapidly shrinking ownership ranks?<span style="mso-spacerun: yes;">
</span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">5.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>When you factor out those PPEP “enhancements,” how
do you interpret individual firms’ actual performances?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">6.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>Put another way, which firms are truly pulling
away from the pack, and which are simply leveraging the power of arithmetic?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">7.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>Between now and 2020, what new business models might
your firm or some of your competitor firms create to differentiate themselves and go to market
more effectively?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif; mso-list: Ignore;"></span></span><br />
<span style="font-family: Verdana, sans-serif;"><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="mso-list: Ignore;">8.<span style="font-size-adjust: none; font-stretch: normal; font-style: normal; font-variant: normal; font-weight: normal; line-height: normal;">
</span></span></span>How could you compete effectively against those
new models?<span style="mso-spacerun: yes;"> </span></span><br />
<span style="font-family: Verdana, sans-serif;"></span><br />
<div class="MsoNoSpacing" style="margin: 0in 0in 0pt;">
<span style="font-family: Calibri;"><span style="font-family: Verdana, sans-serif;">As Am Law releases more early FY2012 firm results, I’ll
be discussing them here.</span><span style="mso-spacerun: yes;"> </span></span></div>
Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-6946944895626407152012-05-10T09:46:00.000-05:002012-05-10T09:46:13.654-05:002012 InnovAction Awards<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif;">As a Fellow of the College of Law Practice
Management, I am pleased to inform my blog’s readers that the College is now
accepting entries for the 2012 </span><a href="http://www.innovactionaward.com/" target="_blank" title="2012 InnovAction Awards"><span style="color: blue; font-family: Verdana, sans-serif;">InnovAction Awards</span></a><span style="font-family: Verdana, sans-serif;">.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly;">
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin;"><span style="font-family: Verdana, sans-serif;">My friend and College Fellow </span><a href="http://www.linkedin.com/in/tcorcoran"><span style="font-family: Verdana, sans-serif;">Tim Corcoran</span></a><span style="font-family: Verdana, sans-serif;"> will
chair this year’s InnovAction Awards competition.<span style="mso-spacerun: yes;"> </span>He has posted some useful information about the
competition at </span><a href="http://www.corcoranlawbizblog.com/2012/05/2012-innovaction-awards/"><span style="color: blue; font-family: Verdana, sans-serif;">his Web
site</span></a><span style="font-family: Verdana, sans-serif;">. <span style="mso-spacerun: yes;"> </span><o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly;">
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";"><span style="font-family: Verdana, sans-serif;">Now in its eighth
year, the InnovAction Awards conduct a worldwide search for lawyers, law firms
and other providers of legal services who are engaged in extraordinary,
game-changing, innovative activities. The award entries are judged based on the
following criteria:<o:p></o:p></span></span></div>
<span style="font-family: Verdana, sans-serif;">
</span><br />
<ul style="margin-top: 0in;" type="disc"><span style="font-family: Verdana, sans-serif;">
</span>
<li class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly; mso-list: l0 level1 lfo1; tab-stops: list .5in;"><span style="font-family: Verdana, sans-serif;"><b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";">Originality:</span></b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";"> Is this a novel idea or
approach, or a new twist on an existing idea or approach?<o:p></o:p></span></span></li>
<span style="font-family: Verdana, sans-serif;">
</span>
<li class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly; mso-list: l0 level1 lfo1; tab-stops: list .5in;"><span style="font-family: Verdana, sans-serif;"><b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";">Disruption:</span></b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";"> Does this entry change an
important element of the legal services process for the better, and
marketplace expectations along with it?<o:p></o:p></span></span></li>
<span style="font-family: Verdana, sans-serif;">
</span>
<li class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly; mso-list: l0 level1 lfo1; tab-stops: list .5in;"><span style="font-family: Verdana, sans-serif;"><b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";">Value:</span></b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";"> Is the client and/or legal
industry better off because of this entry, in terms of the affordability,
ease, relevance or effect of legal services?<o:p></o:p></span></span></li>
<span style="font-family: Verdana, sans-serif;">
</span>
<li class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly; mso-list: l0 level1 lfo1; tab-stops: list .5in;"><span style="font-family: Verdana, sans-serif;"><b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";">Effectiveness:</span></b><span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";"> Has this entry delivered real,
demonstrable or measurable benefits, for the provider, its clients, or the
marketplace generally?<o:p></o:p></span></span></li>
<span style="font-family: Verdana, sans-serif;">
</span></ul>
<span style="font-family: Verdana, sans-serif;">
<span style="mso-bidi-font-family: Calibri; mso-bidi-theme-font: minor-latin; mso-fareast-font-family: "Times New Roman";">Applications and
more information are available at <a href="http://www.innovactionaward.com/" target="_blank" title="InnovAction Award"><span style="color: blue;">http://www.innovactionaward.com</span></a>.
The submission deadline is June 15, 2012.<o:p></o:p></span></span><br />
<span style="font-family: Verdana, sans-serif;">
</span><br />
<div class="MsoNormal" style="line-height: 15pt; margin: 0in 0in 0pt; mso-line-height-rule: exactly;">
<br /></div>
<span style="font-family: Verdana, sans-serif;">
</span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-46905236876458197512012-02-16T05:31:00.006-06:002012-02-16T05:36:06.160-06:00Am Law 100 and 200 FY2011 Financial Results Rolling In<span style="font-family:arial;">‘Tis the season again of big law firm financial reporting. Am Law Daily’s doing a great job this year of collecting and collating Am Law 100 and 200 firms’ FY 2011 financial results by maintaining an </span><a href="http://www.law.com/jsp/tal/PubArticleTAL.jsp?id=1202541704881&slreturn=1"><span style="font-family:arial;">interactive chart</span></a><span style="font-family:arial;"> of results as those are reported. <br /><br />Thank you, Am Law Daily.<br /></span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com4tag:blogger.com,1999:blog-7373657316028198837.post-67712286952734017812011-03-14T12:37:00.005-05:002011-03-14T12:42:15.617-05:00FY 2010 Update: 52 US Law Firms Report Financial PerformanceBelow are some preliminary basic 2010 financial performance data for 52 large US law firms, as their results have been reported in the legal and mainstream press. The firms are ordered by profits per equity partner (highest to lowest).<br /><br /><em>The American Lawyer</em> will publish the final 2010 performance data for the Am Law 100 on May 1 and for the Am Law 200 on June 1. Before then, I will try to revise and publish here at least once more the preliminary results for as many firms as I can locate.<br /><br />As always, if you find any errors in the table below or would like to add a firm’s performance data, please let me know by commenting here or at agibson@annleegibson.com.<br /><br />Final point -- I realize the following table looks fuzzy, but if you click on it you will see a clearer version. <br /><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6O4fEaGky1MXX_pRMnD0q9aLmBoKSZcY2iy_U63HT8y-H8ACxh3ims5DRHzQIgA8FbTMiNojsbxL0OEmqL0PQXUbq7wN_QI0YQThLmIqbVX3V4C9Kw05Sk3qz2wNlm7Le8YDN7mhlgg0/s1600/FY2010%252C+v.2.JPG"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 378px; FLOAT: left; HEIGHT: 809px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5583991846896361346" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6O4fEaGky1MXX_pRMnD0q9aLmBoKSZcY2iy_U63HT8y-H8ACxh3ims5DRHzQIgA8FbTMiNojsbxL0OEmqL0PQXUbq7wN_QI0YQThLmIqbVX3V4C9Kw05Sk3qz2wNlm7Le8YDN7mhlgg0/s400/FY2010%252C+v.2.JPG" /></a>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-7238804363147911572011-03-04T14:28:00.012-06:002011-03-04T14:34:10.118-06:00FY 2010 U.S. Law Firm Financial Performances ... Trickling InLike many law firm watchers, I’ve been gathering information about US law firms’ financial results from reports in the legal press. To date, I’ve collected the following info about gross firm revenue and profits per equity partner and am sharing it here with readers. The firms are ordered by profits per equity partner (highest to lowest).<br /><br />If you find any errors in the table below or would like to add a firm’s performance data, please let me know by commenting here or at <a href="mailto:agibson@annleegibson.com">agibson@annleegibson.com</a>. I will continue to review press reports and update these results from time to time.<br /><br /><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEifK0MZXvKrk46m2YyhWHtyPbbVkAlRPXSEAAId756hqFewo4KcRAOjImB3zJbal9yiF4zr_PWIR9eLgZ9-o4W0IJvHQjmrg0Y8OfeZy0gEkzhR3qo97frYqvJV-R7T-o8iO4WJFqGDH64/s1600/2011+firm+jpg.JPG"><img style="MARGIN: 0px 10px 10px 0px; WIDTH: 351px; FLOAT: left; HEIGHT: 590px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5580324756615362130" border="0" alt="" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEifK0MZXvKrk46m2YyhWHtyPbbVkAlRPXSEAAId756hqFewo4KcRAOjImB3zJbal9yiF4zr_PWIR9eLgZ9-o4W0IJvHQjmrg0Y8OfeZy0gEkzhR3qo97frYqvJV-R7T-o8iO4WJFqGDH64/s400/2011+firm+jpg.JPG" /></a>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-88821992637189150722011-02-25T09:02:00.004-06:002011-02-25T09:21:04.459-06:00Intelligence blind spots, failures and excuses<a href="http://lawfirmci.blogspot.com/2011/02/our-reluctance-to-recognize-tipping.html">Twelve days ago</a> at this blog, I said the U.S. intelligence community’s failure to predict the pan-Arab democratic rebellion was evidence of our common, human reluctance to recognize tipping points.<br /><br />The ongoing public discussion about these events invites us to consider also how blind spots and cognitive biases can lead to intelligence failures in any field, including law firm intelligence work.<br /><br />Today’s New York Times offers <a href="http://www.nytimes.com/roomfordebate/2011/02/24/why-didnt-the-us-foresee-the-arab-revolts">a panel of six Sunday morning intelligence quarterbacks</a> who trot out some reasons why the U.S. intelligence community failed to predict the pan-Arab democratic movement and its recent tipping point. Their reasons for this failure and their other comments about intelligence blind spots include some I find useful to ponder about my own work in law firm CI and a few I find merely comical:<br /><br />1. The intelligence community has failed to appreciate the power of social networking.<br /><br />2. The intelligence community roots out analysts with good instincts.<br /><br />3. The intelligence community punishes and silences those who say the unpopular.<br /><br />4. Specialists find it difficult to see broader trends.<br /><br />5. Immediate challenges crowd out long-range thinking.<br /><br />6. Intelligence based on inputs from those in the seat of power will fail to appreciate the power of those forces that oppose seated power.<br /><br />7. Some changes, no matter how large, do not require a new or immediate response.<br /><br />8. It is unwise to focus only on events in those spaces where we have invested the most; events in other spaces may affect us as much or more so.<br /><br />9. A single, dramatic event can quickly convert widespread, dormant awareness into widespread, sympathetic action.<br /><br />10. Foreseeing events is much easier than predicting when those events will happen.<br /><br />11. Intelligence never has and cannot forecast revolutions.<br /><br />12. The President did not tell the intelligence community to focus on the possibility of a pan-Arab rebellion.<br /><br />Yes, intelligence work is difficult. But the New York Times panelists do little more than describe some of the many blind spots that all high-end intelligence units are expected to understand and navigate. In fact, blind spots are an old and dangerous enemy to intelligence workers.<br /><br /><a href="http://en.wikipedia.org/wiki/Richards_Heuer">Richards (Dick) Heuer</a>, the legendary CIA analyst, described in the now out-of-print <a href="https://www.cia.gov/library/center-for-the-study-of-intelligence/csi-publications/books-and-monographs/psychology-of-intelligence-analysis/index.html">Psychology of Intelligence</a> several dozen biases that afflict intelligence analysts. This book’s central tenet is that “people tend to see what they expect to see, and new information is typically assimilated to existing beliefs.” Ibid. p.153. <br /><br />Although Heuer learned his craft within the CIA, the insights he shares in his 1999 classic are universally relevant to business intelligence workers, including those of us who work in and for law firms. We law firm intelligence workers don’t have to predict political revolutions. But we are expected to identify and forecast many forces and movements that will affect the prospects of individual clients, client industries, labor forces, technologies, and other factors that, in turn, will affect our firms’ own prospects.<br /><br />Although our blinders and biases cannot excuse intelligence failures, when failures do occur we must try to appreciate how our blinders and biases kept us from doing a better job, to reduce their negative impact in future assignments.<br /><br />We can also learn from others’ intelligence successes and failures. Stay tuned.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com4tag:blogger.com,1999:blog-7373657316028198837.post-2911677522940715382011-02-20T12:04:00.007-06:002011-02-20T12:45:07.895-06:00This is not what I meant by law firm competitive intelligence<strong>Prologue</strong><br /><br />I have long considered, lectured and written about law firm competitive intelligence from the perspective of CI prepared and used in service to the firm’s goals as a business entity. However, CI can also be conducted by law firms and its vendors in service to its clients’ goals. Today’s post addresses that use of CI by law firms.<br /><br />This post also addresses the counterintelligence challenges of a post-Wikileaks world, where law firms and their vendors can be targeted by disgruntled employees, hackers and social engineers. Today’s professional culture encourages us to communicate via email, texting and social media, which are so familiar we forget they are susceptible to revelation – on purpose and through carelessness, through both legal and illegal means. Even sophisticated people ignore these dangers, as today’s post illustrates.<br /><br />The events described below read like they were lifted from Stieg Larson’s “The Girl with the Dragon Tattoo” novel series. However, they were all reported during the past two weeks by the <a href="http://www.ft.com/cms/s/87dc140e-3099-11e0-9de3-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F87dc140e-3099-11e0-9de3-00144feabdc0.html&_i_referer=http%3A%2F%2Fsearch.ft.com%2Fsearch%3FqueryText%3Dhbgary%26ftsearchT">Financial Times</a>, <a href="http://www.nytimes.com/2011/02/12/us/politics/12hackers.html?_r=3&emc=eta1">The New York Times</a>, <a href="http://www.washingtonpost.com/wp-dyn/content/article/2011/02/14/AR2011021406281.html">The Washington Post</a>, <a href="http://www.guardian.co.uk/technology/2011/feb/20/wikileaks-baer-tax-avoidance-hbgary?INTCMP=SRCH">The Observer</a>, <a href="http://legaltimes.typepad.com/blt/2011/02/e-mail-hunton-williams-expected-huge-gains.html">American Lawyer Media</a>, <a href="http://www.wired.com/threatlevel/2011/02/anonymous/all/1">Wired</a>, <a href="http://www.salon.com/news/politics/war_room/2011/02/15/hunton_williams_wikileaks_chamber/index.html">Salon </a>and dozens of other publications, blogs, online chat rooms and message boards.<br /><br />I apologize if I have failed to insert the word “allegedly” everywhere it should appear in the following severely summarized account. Therefore, I hereby stipulate it has been alleged that …<br /><br /><strong>What has been reported?</strong><br /><br />Last fall <a href="http://www.hunton.com/">Hunton & Williams</a> invited three data security companies (HBGary Federal, <a href="http://www.palantir.com/">Palantir Technologies </a>and <a href="http://www.bericotechnologies.com/">Berico Technologies</a>) to work with the firm to prepare a joint new business pitch for the <a href="http://www.uschamber.com/">U.S. Chamber of Commerce</a>, a firm client. This pitch related to some of the Chamber’s political initiatives and investigations and handling of its antagonists.<br /><br />H&W also invited the same three security companies to help prepare a second new business pitch for <a href="https://www.bankofamerica.com/">Bank of America</a>, also a firm client. This pitch related to a BoA internal investigation into documents that <a href="http://en.wikipedia.org/wiki/WikiLeaks">Wikileaks</a> had obtained, possibly from one or more BoA insiders, and threatened to publish on the Internet.<br /><br />As these events were unfolding, HBGary Federal’s CEO, <a href="http://crowdleaks.org/anonymous-retaliates-against-hbgary-espionage/">Aaron Barr</a>, wanted to strengthen his street cred to support the H&W and other business development efforts HBGary Federal was involved in.<br /><br />Barr was already hanging out online with members of <a href="http://en.wikipedia.org/wiki/Anonymous_(group)">Anonymous</a>, a highly secretive, loose collective of activists and hackers. He believed he could elevate his sleuthing reputation by analyzing information on internet chat logs, Facebook, Twitter and elsewhere to identify Anonymous’s secretive leaders and key players. Barr planned to describe his unmasking methodology in a presentation at a February 2011 security conference and was able to publicize this presentation in a news story published on February 4, 2011, in the Financial Times.<br /><br />For a day or so after the February 4 Financial Times story came out, Barr and Anonymous traded online insults. Anonymous then retaliated by hitting HBGary Federal’s corporate network, eventually taking down the company’s site, extracting 70,000 emails and publishing them online. To insult Barr further, Anonymous said their takedown team included a 16-year-old girl who had <a href="http://www.google.com/search?hl=en&rls=com.microsoft:en-us:IE-SearchBox&rlz=1I7ADFA_en&defl=en&q=define:Social+engineering+&sa=X&ei=5iphTc-iL8nogAfF5vz7AQ&ved=0CBcQkAE">social engineered</a> an HBGary Federal company IT admin into revealing another HBGary Federal admin’s logins and passwords.<br /><br />Among the thousands of HBGary Federal emails that Anonymous published were those emails HBGary Federal had exchanged with H&W lawyers while the law firm and three data security companies were preparing the Chamber of Commerce and BoA pitches. Anonymous also uploaded the PowerPoint presentations the three security companies had prepared in consultation with H&W for use prior to or during H&W’s pitches.<br /><br />Those PowerPoint files described the services the three companies would perform, including investigations and possible actions to be taken against lobbying groups, union employees, journalists and others whose allegiances and interests were counter to those of H&W’s clients. Those actions included developing fake personas, preparing and leaking fake information to H&W clients’ adversaries to discredit them, and discouraging commentary by journalists who are “... established professionals that have a liberal bent, but ultimately most of them if pushed will choose professional preservation over cause, such is the mentality of most business professionals.”<br /><br /><strong>Where do things stand now?</strong><br /><br />1. <a href="http://www.hbgaryfederal.com/">HBGary Federal’s web site</a> is still down.<br /><br />2. Palantir and Berico have apologized for their involvement in these events and severed all ties with HBGary Federal. Palantir also suspended the 26-year-old engineer who worked on the PowerPoint presentations.<br /><br />3. The Chamber of Commerce denied hiring any of the three companies or H&W.<br /><br />4. Bank of America said they have never seen the presentation described in the emails, have never evaluated it, and have no interest in it.<br /><br />5. H&W has refused to comment.<br /><br />6. Some of those named as the Chamber’s adversaries in the hacked emails and PowerPoint files have announced their intention to file ethics charges next week with the DC bar association against three of H&W’s lawyers.<br /><br /><strong>Lessons learned?</strong><br /><br />Whether the activities allegedly contemplated in the HBGary Federal hacked emails and PowerPoint files were competitive intelligence or corporate espionage or worse, they violated the Society of Competitive Intelligence Professionals’ <a href="http://www.scip.org/About/content.cfm?ItemNumber=578">Code of Ethics</a>. As I have said many times before, including <a href="http://www.annleegibson.com/PublicDocs/Doc_ID_1085_31920081257968.pdf">here</a>, law firm competitive intelligence workers should all read that brief code of ethics, take its seven elements to heart and agree to abide by it. I now recommend that lawyers do so, too.<br /><br />These events also have sobering implications for law firms’ own network security challenges. If a data security firm can be hacked and all its emails and attachments posted online, how well would most law firm networks stand up to such an assault? And if the firm’s network were breached in this way, what would be the costs to the firm and its clients and prospects? This law firm counterintelligence challenge requires not only technological safeguards, but also full recognition that lawyers and law firm employees are just as susceptible as anyone else to social engineering.<br /><br />I have no doubt that everyone associated with this dog’s breakfast wishes it had never happened. Some blame the mess on security carelessness. Others see the leaked emails and PowerPoint files as evidence of ethical lapses and possibly criminal intent.<br /><br />Optimistically, I view these events as an opportunity to remind ourselves, once again, of the ethical limits of competitive intelligence activities. Above all professions and industries, lawyers and law firms cannot be ignorant of or ignore these ethical limits.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com1tag:blogger.com,1999:blog-7373657316028198837.post-29117364641733012692011-02-14T14:11:00.005-06:002011-02-14T14:22:53.962-06:00Our Reluctance to Recognize Tipping Points“The past is the best predictor of the future” is one of humankind’s most reliable decision-making aids. It’s a highly useful heuristic, except when it collides with sudden changes in the status quo – what we popularly call tipping points and which can be biological, political, cultural, technological or emotional.<br /><br />Today’s <em>New York Times</em> offers a <a href="http://www.nytimes.com/2011/02/14/world/middleeast/14egypt-tunisia-protests.html?_r=1&hp=&pagewanted=all">compelling review</a> of the two-year pan-Arab youth movement culminating in the 18-day revolution that unseated the 30-year reign of Egyptian President Hosni Mubarak. The revolution’s outcome was a tipping point that formal intelligence channels didn’t predict. “…[T]he American intelligence community and Israel’s intelligence services had estimated that the risk to President Mubarak was low – less than 20 percent ….” But according to the <em>Times</em>, President Obama interpreted the information differently and acted in accordance with his own analysis of events.<br /><br />Nothing goes up forever, and nothing goes down forever. A straight, uninterrupted line in any direction will fail to predict the future. The simple fact that a condition <em>continues and continues </em>will eventually produce new events that lead to a new condition which produces new events that … you get it.<br /><br />Which leaves intelligence workers with the usual questions: What are the cycles and patterns of change? When will the tipping points happen? How and where and when can we position ourselves to benefit most from events we can never completely control?<br /><br />These are also some of the most compelling questions for decision makers.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-54855139800587933452011-01-30T08:14:00.008-06:002011-01-30T11:58:27.939-06:00The New York Times vs. Assange<em>The New York Times's</em> weekend magazine article, “Dealing with Assange and the Wikileaks Secrets,” by Bill Keller, <em>The Times’s</em> executive editor, is a delicious, dishy apologia for the newspaper's handling of Wikileaks information released last year about the wars in Iraq/Afghanistan and US diplomatic cables.<br /><br />It is also a fascinating take (from one point of view, as all takes are) on how journalism continues to be as relevant as ever – in fact, even more necessary – to interpret the huge amount of information now available via the Internet in today’s tell-all culture.<br /><br />Another observation I offer about journalism relates to its threatened future funding. I was so entertained by the Keller article that I purchased for $5.99 <em>The Times’s</em> e-book: <em>Open Secrets -- WikiLeaks, War and American Diplomacy: Complete and Expanded Coverage from The New York Times.</em><br /><br />My conclusions: Content is still king. Analyzed information (intelligence) is more valuable than information. Dishing always outdraws boring facts.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com1tag:blogger.com,1999:blog-7373657316028198837.post-47263938107189758212011-01-28T11:06:00.004-06:002011-01-28T11:10:05.171-06:00Two confessionsFirst confession -- My name is Ann Lee Gibson, and I am an imperfect and intermittent blogger. Work, family, life, sleep and fun all conspire to keep me from being a daily, weekly or even monthly blogger. It ain’t ever gonna happen, and I’ve now accepted it.<br /><br />Second confession -- I wanted this blog to be only about law firm competitive intelligence, hence the blog title. However, sometimes I also want to talk or vent about other law firm marketing topics that are only peripherally related to law firm CI. Therefore, I’ve decided that from now on I will unleash myself here on any law firm marketing topic I find I’m obsessing about, that has raised my blood pressure, or that tickles my funny bone.<br /><br />Live with it.<br /><br />And now, on to the next post.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-78637021756531882222010-11-01T12:54:00.011-05:002010-11-01T13:20:54.456-05:00Be more precise about uncertaintyNote: The following is the latest in the current blog series about analysis and CI. It is excerpted from my new book, <em>Competitive Intelligence: Improving Law Firm Strategy and Decision Making</em>. You can learn more about the book and purchase it <a href="http://www.mpmagazine.com/Publication.asp?pubid=A711489A-D0F4-4EBF-8043-B7DA3AC2C198">here</a>. <br /><br />The CI discipline has spawned some pithy maxims, one of which says intelligence does not predict the future. Another one tells us that intelligence need not survey every tree in the competitive forest to understand how the forces within that forest <em>may</em> affect our ability to perform there. <br /><br />Heeding the spirit of these two maxims, intelligence analysts develop high tolerance for ambiguity and uncertainty. Consequently, intelligence reports tend to reflect these ambiguous environments by the inclusion of qualifier terms like <em>certainly, almost certainly, highly likely, good chance, probable, likely, improbable, unlikely, highly unlikely, may, maybe, most, few, some, we doubt, we are confident, we believe</em>, etc.<br /><br />Although these qualifiers reflect analysts' inability to make crystal ball predictions, unnecessary confusion develops when analysts and decision makers fail to agree -- sometimes without realizing they disagree -- over the meaning of terms like "probable." One often-cited study about the interpretation of intelligence revealed that 23 decision makers interpreted the likelihood of a "probable" event's occurrence ranging from 25% to 91% (by Sherman Kent, "Words of Estimated Probability," in Donald P. Steury, ed., <em>Sherman Kent and the Board of National Estimates: Collected Essays</em>, published by the CIA, Center for the Study of Intelligence, 1994).<br /><br />Other common qualifiers found in intelligence reports are phrases having to do with time, e.g., <em>soon, often, usually, seldom, infrequent, at this time</em>. An analyst who knows what she or he means by these phrases should replace them with more specific judgments, e.g., <em>during 2011, before the economy turns around, by 2Q 2012</em>. More specific opinions like these improve the intelligence and its usefulness. <br /><br />Analysts must offer conclusions that are as precise as but no more precise than their analyses will permit. Therefore, a good way to further reduce uncertainty is to highlight all the qualifiers in a nearly final intelligence report. Then ask your colleagues with fresh eyes (those who did not work on the report) to tell you what these terms mean to them in more specific terms. If you learn from this exercise that the intelligence they received was not the intelligence you thought you had provided, edit your report accordingly.<br /><br />Another opportunity to reduce uncertainty in intelligence reports appears as you prepare your findings to decision makers. Anticipate their most likely questions, but do not wait for the questions to be asked. Include the questions and your best answers in the report itself. By such simple means, intelligence reports can become more meaningful and useful to law firm CI clients.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-32987351105472051872010-10-29T07:56:00.003-05:002010-10-29T08:30:29.157-05:00CI insights are actionable, relevant, externalNote: The following post is taken from my new book, <em>Competitive Intelligence: Improving Law Firm Strategy and Decision Making</em>. You can learn more about the book <a href="http://www.mpmagazine.com/Publication.asp?pubid=A711489A-D0F4-4EBF-8043-B7DA3AC2C198">here</a>.<br /><br />If you have spent any time studying or developing CI, you will have noticed that experienced CI practitioners spend more time discussing analysis than any other component of the intelligence cycle.<br /><br />While all steps of the cycle are equally important and mutually dependent, analysis turns what all firms have -- information -- into actionable insights that are uniquely relevant to your firm. If you follow all other steps in the intelligence cycle, but skip the analysis, the best your firm can hope for is to be on par with the majority of its competitors, rather than enjoying a competitive advantage. <br /><br />So, what do we mean by analysis? Simply put, CI analysis is the process of drawing actionable, relevant insights from external information. All the adjectives in this definition are instructive, and you should keep them in mind as you plan and do your analysis. <br /><br /><strong>Actionable</strong> - Information on its own is benign and only becomes actionable through analysis. For example, a client dossier or competitor profile that doesn't identify the opportunity for your firm to act is just static data, not intelligence. In addition, "actionable" means "forward-looking." If your firm is going to take actions in the future, your analysis has to provide insights about the future environment, e.g., new cross-selling opportunities, an emerging overseas market or the strategic direction of a potential merger partner. <br /><br />It must also be said that the same information can be converted, through analysis, into different intelligence for two different firms in different circumstances that are evaluating different decision options. <br /><br /><strong>Relevant </strong>- "Relevance" is closely related to "actionable" and means that as you plan and deliver your intelligence you understand the context in which the intelligence will be used, including which actions your firm can conceivably take. For instance, the identification of a potential new overseas location would be neither relevant nor actionable if your firm has just had its worst year on record, has no available funds for expansion and is losing key partners. Likewise, an analysis of new opportunities in commercial real estate work is unlikely to be either relevant to your firm's needs or actionable if the firm has just declared growth of its litigation practice to be the firm's top priority. <br /><br />Obviously, the information you gather and analyze must be brightly relevant to the decisions at hand, not merely easy to obtain. Too often law firm CI practitioners rely overmuch on secondary information developed by information aggregators who sell the same information to all competitors. Too seldom, firms seek out primary sources with information your competitors do not yet have. For example, primary sources (clients, industry experts and others) can provide attitudinal opinion information (about changing needs, satisfaction, loyalty) and behavioral information (about hiring and spending behaviors, attendance, etc.). You can obtain primary information through interviews or by simply observing the marketplace.<br /><br />Relevance also applies to timing the delivery of your intelligence. For example, if you were to provide one of your firm's partners with an analysis of potential cross-selling opportunities at Client X one week <em>after</em> that partner had pitched a different set of services to Client X, you are unlikely to get much of a response from the partner, at least not a positive one.<br /><br /><strong>External </strong>- While you certainly must understand the internal dynamics of your firm to be able to provide relevant intelligence, your analysis should focus only on factors outside the firm. Law firms are notoriously introspective, so CI should be the objective voice of the external environment inside your firm. More to the point, a law firm's opportunities only take place <em>outside</em> the firm; inside the firm there are only costs.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-43297110051075909002010-10-27T08:38:00.005-05:002010-10-27T08:51:23.010-05:00New law firm CI book publishedAs many of you know, I've recently written a book about law firm CI. It has now been published in the UK by the Ark Group / Managing Partner magazine. <br /><br />My book is titled <em>Competitive Intelligence: Improving Law Firm Strategy and Decision Making</em>. You can learn more about the book and download sample sections <a href="http://www.mpmagazine.com/Publication.asp?pubid=A711489A-D0F4-4EBF-8043-B7DA3AC2C198">here</a>. You can also purchase it <a href="http://www.ark-group.com/home/Publications/Publication.asp?pubid=%7bA711489A-D0F4-4EBF-8043-B7DA3AC2C198%7d">here</a>.<br /><br />This book is aimed at a broad audience -- partners and senior managers of law firms, CI practitioners and othes inside or outside law firms who want to understand how to apply CI in a law firm setting. <br /><br />It takes a highly practical look at how CI is applied in firms. It also addresses how CI in the legal industry is similar to and distinct from CI in other industries, the challenges peculiar to law firms, typical law firm key intelligence topics and assignments, and more.<br /><br />This report will surprise some readers when it describes how some firms are already executing the full range of CI activities as that discipline is practiced in the corporate world. As with other business disciplines once considered "not for law firms," the full spectrum of CI activities, legally and ethically executed, is rapidly being accepted by more law firm leaders.<br /><br />The greatest demand in law firm CI these days is for sophisticated analysts with strong legal industry knowledge, business savvy and broad analytical skills. Without their eventual contributions, CI in law firms will not advance beyond information gathering, which, although useful, cannot offer decision makers the fuller benefits of actionable intelligence.<br /><br />Whether your firm already has informal CI in-house capabilities and wants to upgrade them, wishes to engage the services of external CI consultants or hopes to learn how to utilize its existing CI resources to become more competitive, this book will help you decide where you should start. <br /><br /><a href="http://www.mpmagazine.com/Publication.asp?pubid=A711489A-D0F4-4EBF-8043-B7DA3AC2C198">Please check it out</a>.Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-73211583376001546332010-10-25T16:33:00.006-05:002010-10-25T17:24:44.656-05:00Social psychology and alpha lawyersThe ABA Journal today <a href="http://www.abajournal.com/news/article/study_finds_link_between_law_firm_profitability_and_mps_with_powerful_faces/">blogged</a> about a recently published social psychology experiment that found the apparent dominance / maturity of law firms' managing partners' faces (as rated by college students, the usual social science lab rats) correlated slightly (14%) with the managing partners' respective firms' profitability levels.<br /><br />For a limited time you can download the study report <a href="http://spp.sagepub.com/content/early/2010/10/01/1948550610385473.full.pdf+html">here</a>.<br /><br />Even though I am a social scientist myself, I have a hard time interpreting this not-yet-replicated study as anything other than entertaining silliness. However, given that neither lawyers nor marketers are renowned for their statistical savvy (otherwise, they'd have become accountants and physicists), I'm a little worried about what some might do with this new-found information.<br /><br />Below is an animated movie (created with my new favorite online toy, <a href="http://www.xtranormal.com/">xtranormal</a>) to illustrate the dangers of leaping into action after reading a headline that says, "Recent research finds that ...."<br /><br /><object width="480" height="390"><param name="movie" value="http://www.xtranormal.com/site_media/players/jwplayer.swf"><param name="allowFullScreen" value="true"><param name="allowscriptaccess" value="always"><param name="flashvars" value="height=390&width=480&file=http://newvideos.xtranormal.com/web_final_lo/1fd6f18c-e074-11df-a9a6-003048d69c21_4.mp4&image=http://newvideos.xtranormal.com/web_final_lo/1fd6f18c-e074-11df-a9a6-003048d69c21_4.jpg&link=http://www.xtranormal.com/watch/7455567&searchbar=false&autostart=false"><embed src="http://www.xtranormal.com/site_media/players/jwplayer.swf" width="480" height="390" allowscriptaccess="always" allowfullscreen="true" flashvars="height=390&width=480&file=http://newvideos.xtranormal.com/web_final_lo/1fd6f18c-e074-11df-a9a6-003048d69c21_4.mp4&image=http://newvideos.xtranormal.com/web_final_lo/1fd6f18c-e074-11df-a9a6-003048d69c21_4.jpg&link=http://www.xtranormal.com/watch/7455567&searchbar=false&autostart=false"></embed></object><object width="480" height="390"><param name="movie" value="http://www.xtranormal.com/site_media/players/embedded-xnl-stats.swf"><param name="allowFullScreen" value="true"><param name="allowscriptaccess" value="always"><embed src="http://www.xtranormal.com/site_media/players/embedded-xnl-stats.swf" width="1" height="1" allowscriptaccess="always"></embed></object>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com2tag:blogger.com,1999:blog-7373657316028198837.post-23182677102324549722010-10-25T08:42:00.005-05:002010-10-25T08:57:52.011-05:00Say what?<em>I'm blogging again, thanks to <a href="http://www.progressivemarketingblog.com/">Russell Lawson</a> who emailed me and said, "Just do it." The following is the first in a series of posts on the topic of analysis -- that much too mysterious process that converts information into intelligence.</em> <br /><br />Last week, as often happens, I was on an airplane. I was seated next to a nice man, an intelligent man. <br /><br />Early in the flight during light conversation, he proffered the news that young people are spending too much time looking at computer screens instead of books and that their brains are being rewired in new ways. Studies were proving this to be true, he said. <br /><br />"Oh," I said, "What do the studies say is happening to their brains?"<br /><br />"I don't know," he responded, "but it can't be good." <br /><br />Several hours later, he offered me more information. "I read an article recently that said 80% of Americans did not read a single book last year." <br /><br />"Wow," I said. "How many Americans used to read one or more books a year?"<br /><br />He frowned and said, "I don't know." <br /><br />The above anecdote suggests an autumn meditation for law firm CI practitioners and their clients: What would improve your own firm's decision making -- more information or more analysis?Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com1tag:blogger.com,1999:blog-7373657316028198837.post-26959004100460757892009-04-22T07:26:00.003-05:002009-04-22T07:32:17.525-05:00CI Pro Interview with Emily C. Rushing<span style="font-family:verdana;">Name: Emily C. Rushing<br />Title: Competitive Intelligence Specialist<br />Firm: </span><a href="http://www.haynesboone.com/"><span style="font-family:verdana;">Haynes and Boone, LLP</span></a><span style="font-family:verdana;"><br />Since: September 2008<br />Profiles: You can find Emily at </span><a href="http://www.linkedin.com/in/emilyrushing"><span style="font-family:verdana;">LinkedIn</span></a><span style="font-family:verdana;"> and </span><a href="http://twitter.com/emily_rushing"><span style="font-family:verdana;">Twitter</span></a><span style="font-family:verdana;">.<br /><br />Q: What is your job description at Haynes and Boone? <br /><br />A: My role is primarily focused on developing and reporting strategic business and competitive intelligence. I support the Business Development and Marketing Departments, the CMO, the firm’s attorneys, and, most importantly, firm management.<br /><br />Q: Who are your typical CI clients at Haynes and Boone?<br /><br />A: My clients range from associates to the Managing Partner to marketing staff. My primary clients are the Business Development Managers who coordinate with me on behalf of their respective practice groups.<br /><br />Q: What are three common KITs you’re often asked to address?<br /><br />A: Topics for our intelligence frequently include: 1) profiling competitors’ practice areas and clients, 2) identifying business development opportunities for the firm among existing clients and developing strategic targeting programs, and 3) developing intelligence in preparation for business development meetings with existing or potential clients.<br /><br />Q: How is the intelligence function organized at your firm? To whom do you report?<br /><br />A: I am the firm’s only CI professional. I am directly supervised by the Director of Business Development, indirectly supervised by the CMO, and my role is situated within the Marketing department.<br /><br />Q: What experience or training prepared you most for the CI work you do now at Haynes and Boone?<br /><br />A: My years as a research specialist with </span><a href="http://www.kslaw.com/"><span style="font-family:verdana;">King & Spalding</span></a><span style="font-family:verdana;"> were good training for the CI work I do for my current firm. I also developed technical skills with various softwares during my time working as a consultant and freelance technical librarian.<br /><br />Q: What formal CI training have you had? <br /><br />A: Very little CI-specific training. I studied social sciences and statistics in college and went on to achieve a Juris Doctorate and Master’s of Library and Information Sciences. These are highly analytical areas of study, and I feel that the training I received in those programs were wonderful preparation for my career in CI.<br /><br />Q: Where do you go for ongoing CI training and mentoring? <br /><br />A: Since accepting this position, I have attended webinars and tried to expose myself to the basic literature. I also have been mentored by colleagues via professional organizations like </span><a href="http://www.scip.org/"><span style="font-family:verdana;">SCIP</span></a><span style="font-family:verdana;"> and </span><a href="http://www.sla.org/"><span style="font-family:verdana;">SLA’s</span></a><span style="font-family:verdana;"> CI division, for which I am very grateful. From librarian to CI professional isn’t as jarring a transition as lawyer to librarian, but has required some adaptation.<br /><br />Q: What specific adaptations have you found necessary in your transition from librarian to CI professional? <br /><br />A: The most helpful adaptation I have made has been to change my patron/client focus from transaction-oriented (retrieve article, locate book on shelf, instruct on research techniques, build bibliography, perform catalog search) to results-oriented (find and understand the client, prepare for the meeting, get the business, maximize the relationship). My new, CI perspective looks less at the question "What is the patron asking me to give them?" or even "What do we need to know?" than it looks to the question "What should we do and how can intelligence help us make a better decision?" Once I really understood my present role in terms of the latter phrase, rather than either of the first two phrases, CI made sense to me and I was able to more smoothly transition from a research practice to an intelligence practice.<br /><br />Q: What do law firms most often misunderstand about CI? What should they know about CI that you’re afraid is often misunderstood? <br /><br />A: There is some misunderstanding about the process of developing KITs and CI. It is a two-way street, and a successful CI program requires that management and decision-makers share information with the CI professional. For CI to simply generate a report on a set of data or research into a particular topic is not a successful use of CI. CI must be actionable and must help inform management’s decisions, but that requires that management perceive CI as an integral part of the decision-making process.<br /> </span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-90277710909028004562009-04-20T09:14:00.016-05:002009-04-21T12:18:50.007-05:00Law Firm Economic Cycles Part IV<span style="font-family:verdana;color:#000000;">Here’s my fourth and final post in a series offering findings from analyses I performed last fall as my law firm clients were considering how best to respond to the economic downturn. Seven months later, some of my findings from last fall look like a big duh, although others still offer useful insights. (For more details and caveats about this series, read the past three posts at this blog.)<br /><br /><strong>1. Many firms will return to a single equity partnership tier.<br /></strong><br />In the nineties, law firms created non-equity partnership tiers as a tactic to elevate their profits-per-partner performances. The number of non-equity partners in law firms grew in the 2000s, those ranks filled by reliable technicians who did good work and supplemented labor gaps unmet by the associate talent wars.<br /><br />As a result, many firms now have expensive, middle-aged legal work forces with reduced appetite and aptitude to become equity partners. These non-equity partners supervise associates, a useful function, but one that has an unintended consequence of blocking mentoring of associates by partners who are business owners, a distinction I think is important. It’s interesting that law firm associates’ widespread and vocal dissatisfaction with their professional lot coincides with their greater insulation from equity partner mentoring.<br /><br />Although few firms have yet announced taken they will action to eliminate completely their multiple partnership tiers, I have long heard firm leaders talk about their desires to return to a smaller, single equity partnership structure for a variety of reasons. Therefore, I view some of the late 2008 and early 2009 partner downsizings as not only housecleaning and paring of practices, by efforts to reduce these non-equity partnership tiers.<br /><br /><strong>2. Legal marketing and business development functions will continue to evolve.<br /></strong><br />During the recession of 1990-91 and through the nineties, law firms began to engage marketers and marketing methods from other industries. This first wave of professional legal marketers focused on basic marketing services—promotional events, marketing communications, public relations, and branding. Marketing services have expanded over the years to include sales and sales support, decentralized marketing support for practice and industry groups, market research, in-house client feedback programs, and key client programs.<br /><br />I predict that in the current downturn law firm marketing will undergo a second renaissance. Marketing contributions that were valued 15-20 years ago probably will not make a big difference this time around.<br /><br />Going forward, competitive firms will double down with even more professional sales support and coaching, key account management, and much more sophisticated competitive intelligence functions. These skill sets will help firms to acquire, expand, and defend their best client relationships. These functions will also help firms add badly needed rigor to their business planning function. </span><span style="font-family:verdana;color:#000000;">Strategy, long pooh-poohed by most firm leaders, is finally seen to be important at both practice group and firm-wide levels. During this global recession and the new-world recovery to follow, law firms now need the early-mover and better execution advantages these functions offer.<br /><br />And with print journalism on its last legs, law firms’ traditional PR programs will have no choice but to embrace Web 2.0 tools and activities to support the firm’s and individual lawyers’ institutional and personal brands through digital promotion and virtual word of mouth.<br /><br /><strong>Conclusion: Recessions Offer a Chance to Step Forward<br /></strong><br />Recessions offer opportunities for a law firm to emerge stronger than its competitors. Certainly, a law firm is obliged to do whatever it must to survive in the short term. But the greater challenge for law firm leaders and their advisors is to find and take those positions (invest in resources) that will take advantage of changes wrought by the recession and the eventual recovery. Firms that will be stronger after this recession are those that find and tap new opportunities at the intersection of otherwise disconnected areas of expertise, where change is happening that they can exploit. (USC business school professor Dick Rumelt describes this approach to successful strategy in an excellent <a href="http://www.mckinseyquarterly.com/Strategys_strategist_An_interview_with_Richard_Rumelt_2039"><em>McKinsey Quarterly </em>interview</a></span><span style="font-family:verdana;color:#000000;">.)<br /><br />The changes this recession introduces to law firms are nearly limitless—energy and environmental changes, client industry changes, political changes, legislative and regulatory changes, dramatic changes in communications and news channels, as well as changes in the legal talent pool, law firm structures, fee arrangements, business processes, and legal technology.<br /><br />Lessons from the 1990-91 recession tell us that fifteen to twenty years from now, at least a fifth of today’s “leading law firms” will no longer be around, having dissolved or been acquired by stronger firms. Many others will have fallen one or more quartiles in the rankings that matter most—firm revenue, revenue per lawyer, and profits per equity partner. But still others will have ascended dramatically, having done what firms like <a href="http://www.lw.com/">Latham</a>, <a href="http://www.orrick.com/">Orrick</a>, <a href="http://www.dechert.com/">Dechert</a>, <a href="http://www.goodwinprocter.com/">Goodwin Procter</a>, and <a href="http://www.quinnemanuel.com/">Quinn Emanuel</a> did in the last fifteen years—finding and tapping new opportunities at the intersection of otherwise disconnected areas of expertise, where change is happening that they can exploit.<br /><br /></span><span style="font-family:verdana;color:#000000;"></span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-3878444624712486942009-04-16T21:11:00.013-05:002009-04-16T21:32:11.142-05:00Law Firm Economic Cycles -- Part III<span style="font-family:verdana;">This is my third post in a four-part series that offers findings from analyses I performed last fall as my law firm clients were considering how best to respond to the economic downturn. Seven months later, some of my findings from last fall look like a big duh, although others still offer useful insights. (For more details and caveats about this series, read the past two days’ posts.) <br /><br /><strong>5. In this recession, many law firms will be dissolved or acquired by stronger firms.<br /></strong><br />I maintain a list of “weakest link” law firms—those that are nearing or have passed a tipping point in terms of falling lawyer headcount and net operating income (these two metrics seem to be as good or better indicators of potential law firm dissolution or fire-sale acquisition compared to more arcane metrics). Right now, my weakest links list contains the names of nearly a dozen US law firms among the Am Law 200, the dissolution or acquisition of which would improve the health of competing firms, in some cases dramatically. <br /><br />As with earlier recessions, this one will drive some law firms to failure and weaken other firms that will fail after the recession ends. US regional markets that are particularly stressed include Atlanta, Boston, Ohio, and the San Francisco Bay Area. During and following this recession, we can also expect to see failures or acquisitions of three or four New York Am Law 100 and 200 firms. <br /><br />Firms that grew rapidly in recent years, spending or borrowing heavily to fund their growth, will suffer extra pressures during this recession. Those pressures will be hardest to withstand at firms where large blocs of partners have been together only a short while.</span><br /><span style="font-family:verdana;"></span><br /><span style="font-family:verdana;">These forecasts should not shock anyone. Of the Am Law 100 firms listed in reports describing 1989’s financial performances, twenty no longer exist. Eight were acquired, and twelve have dissolved (see Table 2 below). <br /><br /><strong>Twenty 1989 Am Law 100 Firms That No Longer Exist<br /></strong><br /><em>A. <u>Eight Firms Were Acquired</u><br /></em>1. Brown & Wood<br />2. Hale and Dorr<br />3. Hopkins & Sutter<br />4. McCutchen, Doyle, Brown & Enersen<br />5. Rogers & Wells<br />6. Rosenman & Colin<br />7. Shaw Pittman<br />8. Winthrop, Stimson, Putnam & Roberts<br /><br /><em>B. <u>Twelve Firms Have Dissolved</u><br /></em>9. Arter & Hadden<br />10. Brobeck, Phleger & Harrison<br />11. Coudert Brothers<br />12. Gaston & Snow<br />13. Graham & James<br />14. Heller Ehrman White & McAuliffe<br />15. Johnson & Swanson<br />16. Keck, Mahin & Cate<br />17. Mudge Rose Guthrie Alexander & Ferdon<br />18. Pettit & Martin<br />19. Shea & Gould<br />20. Thelen, Marrin, Johnson & Bridges<br /><br /><strong>6. Stronger firms absorb failing firms’ best assets, producing even stronger firms. <br /></strong><br />As in the past, many lawyers in firms that will fail or falter in the next few years will remain in private practice. An acquired firm’s strongest assets (lawyers) with the best strategic fit will be retained and assimilated, or they will find even stronger new homes. <br /><br />Newly acquired and unhappy groups and practices at unsteady firms will be fair game for poaching firms with the resources to invest in new talent.<br /><br />Odds are also strong that a Magic Circle firm and a top-tier New York City firm will soon find more reasons to merge than to stay single. If I had more courage, I would name here those two firms I fantasize will tie the knot.<br /><br /><strong>Coming soon:<br /></strong><br />Tomorrow’s post concludes this series and addresses coming changes in: <br /><br /><strong>7. Law firm partnership tiers<br /></strong><br /><strong>8. Marketing and business development functions <br /></strong></span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com0tag:blogger.com,1999:blog-7373657316028198837.post-77186638991831521452009-04-15T09:42:00.016-05:002009-04-15T10:29:14.916-05:00Law Firm Economic Cycles -- Part II<span style="font-family:verdana;">This post continues the serialization begun yesterday of findings from analyses I performed last fall as my law firm clients were considering how best to respond to the economic downturn. To help them, I parsed US law firm performance data, particularly those from 1989-1996 to identify precursors to and impacts of the 1990-91 recession on law firms’ financial performances. </span><br /><br /><span style="font-family:verdana;">As noted yesterday, I have long since shared the insights gleaned from my analyses and their early warning benefits with my own clients. Therefore, it’s now appropriate to share them with a larger audience. Which brings us to today's post.</span><br /><br /><span style="font-family:verdana;"><strong>3. Higher-end firms suffer longest from recessions. </strong></span><br /><strong><span style="font-family:Verdana;"></span></strong><br /><span style="font-family:verdana;">Partners at firms with the highest-end practices should manage particularly downward their expectations of an early recovery. A severe recession’s impacts are generally felt longer by the most profitable law firms, which rely on a stream of complex, high-value deals and, therefore, must wait longer for that level of economic activity to reappear and stabilize. </span><br /><span style="font-family:Verdana;"></span><br /><span style="font-family:verdana;">Evidence of the long-lasting effects of severe global recessions on highest-end law firms is offered by their performances during the early 1990s. After 1989, seventeen of that year’s twenty most profitable US law firms failed to produce profits per partner (PPP) higher than their 1989 PPP during at least four of the seven following years. </span><br /><span style="font-family:Verdana;"></span><br /><span style="font-family:verdana;">Overall, the most profitable law firms suffer the longest recession impacts. For example, twelve Am Law 100 firms failed to produce higher PPP for all seven of the years following 1989; these firms included Cahill, Cravath, Davis Polk, Gibson Dunn, Kaye Scholer, O’Melveny, Paul Weiss, and Skadden. Eight more Am Law firms failed to exceed 1989 PPP for six of the following seven years; these firms included Kirkland, Latham, Milbank, Wachtell, and Willkie Farr.</span><br /><span style="font-family:Verdana;"></span><br /><span style="font-family:verdana;"><strong>4. Lower-end firms tolerate recessions better and recover from them faster. </strong></span><br /><strong><span style="font-family:Verdana;"></span></strong><br /><span style="font-family:verdana;">The data also show that those firms that generally feel a deep recession’s impacts for the shortest time are less profitable firms with low billing rates and the lowest profits per partner. Even in depressed times, day-to-day legal work does not subside. </span><br /><span style="font-family:Verdana;"></span><br /><span style="font-family:Verdana;">Note: The two findings described above are brightly demonstrated by the data in a chart (<a href="http://www.annleegibson.com/PublicDocs/Doc_ID_1093_4152009102416.bmp">click here</a>) that I simply was unable to figure out how to include here (I welcome any advice and help from readers about how to do this). </span>Ann Lee Gibsonhttp://www.blogger.com/profile/15157684137402294696noreply@blogger.com1