How does a law firm’s business support add value today?
Law firms are waking up to the value that operations can bring if done right, writes Bignon de Keyser partner Richard King
Traditionally, many law firms have seen their operational support as a necessary evil, a cost to be contained rather than a value-add.
Of course, this is not true of all firms. Many see business support as an integral and fundamental part of the firm’s functioning. And across the industry, we are seeing the growth of law firm operational support into new areas, changing the definition of the value that business operations can bring to the business and changing attitudes, even in firms where support has at best been ‘tolerated’.
Let’s look at the traditional rationale for business support and see how those working on different aspects of law firm operations are making an impact in new ways.
1. What is the purpose of law firm operational support?
Put simply, law firm operations support is there to save lawyer time and improve the firm’s service to clients, to keep costs lower and help the business stay client-focused.
Operations have therefore concentrated on taking routine administrative work off the shoulders of lawyers and putting it into the hands of much cheaper people (who are not lawyers). Hence large-scale finance teams focused on billing, reporting and payroll; HR teams managing recruitment, induction and personnel management; and marketing teams handling directory submissions, preparing lawyer CVs and organising client surveys.
These benefits of operational support are increasingly seen as ‘routine’. Now, though, there are some new arguments for the value this support can offer.
2. How can operations improve service delivery?
Business support has moved on from handling administration and keeping the lights on to improving both the value and the efficiency of a firm’s service delivery, and leaving the lawyer to focus on what they are best at – the actual legal output. Examples are:
- The legal project manager who runs a large client matter with better leverage (by moving work to lower-cost lawyers or locations), utilising smarter tools and project management skills.
- The legal technology professional supporting rapid deployment of new technology to speed up legal output or eliminate routine activity by lawyers in the delivery of the legal product.
- The pricing specialist, with their in-depth market analysis and previous experience in areas such as sales, marketing and account management, who drive a better price in negotiations with clients, and conclude deals which bring value to both client and firm.
3. How can operations improve law firm financial returns?
Finance teams have moved on from sorting out the billing and managing the law firm audit trail to assisting better financial recovery by:
- Producing data on lawyer utilisation rates to show firm leaders where cost can be saved through improved work allocation or reduced headcount.
- Providing efficient credit control to reduce lock-up periods and interest costs on overdrafts.
- Reducing write-offs by helping matter partners negotiate better outcomes with clients, where there are challenges on scope of work or unrealistic pricing.
4. How can operations help to bring in new revenue?
Winning new work isn’t all about talented lawyers selling their services. Marketing and business development professionals can also play a direct role through:
- Effective branding of the firm in the external market.
- Identifying and qualifying potential clients, and then marketing the firm’s products and services to them.
- Supporting the firm’s participation in tenders through the preparation of high-quality proposals.
- Preparing first-rate communications for market consumption.
These are all areas where dedicated non-lawyers use their experience and creativity to boost opportunities for the firm externally – and relieve some of the demands on lawyer time.
5. How can operations improve client relationships?
It’s not just lawyers who can manage the firm’s client relationships:
- Client development managers build relationships with clients by developing a deeper understanding of both client needs and the industries they operate in, creating opportunities for further business.
- Non-lawyer professionals with customer experience can bring their perspective to recommend changes to procedures which makes the firm’s internal requirements less bureaucratic for the client – making the firm more client-centric, improving customer retention and increasing the potential for future instructions.
6. How can operations make the firm more attractive to its people and clients?
On the face of it, the idea that business operations can make a real impact on the perception of the firm seems improbable. Isn’t a firm’s attractiveness to its clients and people all about the range and depth of its expertise and the ability and experience of its lawyers? But the attractivity of the modern law firm is about much more:
- The firm’s brand: what does the firm represent in the eye of the beholding client, the onlooking observer? Not what its logo looks like, but what type of firm the market sees, what it stands for and what the firm’s people are like. This can hugely influence buying and hiring decisions. The (non-lawyer) ‘brand professional’ can shape this to create a powerful image of the firm in the market.
- Retaining the loyalty and commitment of the firm’s people depends not just on how much the firm pays them but also their support and development. To get this right demands HR experience in creating the ‘employee value proposition’ to improve staff retention.
- Integral to the support lawyers need is the quality of care for those working long hours and at risk of suffering burnout. There have been a number of (non-lawyer) appointments into roles that focus on staff welfare, for example Clifford Chance hiring its first global head of wellbeing and employee experience.
- If it seems improbable to suggest that corporate social responsibility generates work, this kind of capability improves client and employee perceptions of the value the firm places on issues such as pro bono, sustainability, diversity and inclusion. Clients are increasingly prioritising these issues when making selection decisions about their legal advisers, as do new recruits when considering career choices.
7. How do we get a return on this investment in operational support?
You may be worried that all these roles suggest an exponential explosion in the numbers of non-fee-earners in your firm. There are different ways to address this concern:
- Bureaucratic procedures, such as client onboarding, can be reduced through improved process efficiency, so that fewer non-chargeable people are needed to run them. Firms have hired specialists in Lean Six Sigma methodology to tackle this.
- Service levels can be standardised and simple procedures set up for the lawyers to self-serve, reducing their dependence on bespoke work from administrators.
- Technology is starting to replace or reduce manual labour in the back office. Robotic process automation (RPA) specialists can automate manual steps in internal administration, and so substantially reduce the time required to complete routine tasks. AI or ChatGPT can deliver automated summaries on case law and statutes, or create standard documents from established precedents – jobs which non-chargeable employees would otherwise undertake. Firms might find opportunities to re-think their historic dependence on knowledge lawyers by investing instead in the use of generative AI.
It is also worth the firm asking itself whether it needs necessary manual labour next door to its lawyers. Could equivalent quality labour be sourced from lower-cost countries or lower-cost regions in the same country? If accompanied by process simplification and greater dependence on technology, potentially significant cost reductions in some types of operational support such as accounts management, client onboarding and client proposal production could be achieved if moved offshore.
8. In conclusion ....
We can see there is a case for investment in types of non-chargeable roles and why some firms have been starting that journey. And the fear that this will spawn a proliferating ‘department’ in support can be managed with other methods. Modern law firm operations should comprise high-quality expertise, drawing on experience and learning from other business environments to create value and offer solutions that neither the lawyers nor technology can readily provide.
Richard King is a partner at business consultancy Bignon de Keyser and was previously chief legal operations officer at Herbert Smith Freehills.