Throughout law school, law students are required to regurgitate case law and legislation in essays and exams. In a law exam, a problem is presented, and students only have to identify legal issues and apply relevant laws.
Law students graduate expecting work in a commercial law firm to involve tasks like this:
1. Client seeks advice on a particular area of law
2. Lawyer reads, listens and applies legal knowledge, avising and solving the client's problems.
3. Client follows that legal advice.
4. Lawyer bills, client pays, case closed.
Classic legal tasks one to four are only one dimension of what is required by clients, particularly start-ups and small and medium-sized businesses. These classic tasks were evolved in what has been called the purely bespoke or artisan era of legal practice.
I’m not on my own in this realisation, even for large corporates. A recent survey conducted by Harvard Law School reveals that practicing surveyed large law firm attorneys place:
Less importance on traditional areas of legal knowledge taught in law school; and
More importance on non-legal knowledge areas (eg corporate finance) and non-legal skills (eg developing business strategy).
The fact is, lawyers are expected to have more than legal knowledge, by both commercial law firms and their clients.
Small and medium-sized businesses need external support in business planning and management. They need lawyers who can integrate legal knowledge into industry-specific knowledge and understanding of existing and innovative business models.
Take the example of a client seeking to form a joint venture. To participate in delivering commercially-astute results, lawyers need to ask numerous legal and non-legal review questions before advice or drafting can begin.
The non-legal questions include:
What is the nature of the business and who are the stakeholders involved?
Which industries, markets and technologies relate to the business?
Is there any business plan, planning work or a defined business model?
What business processes and workflow is to be applied in the business?
How is the business going to be managed?
What is the anticipated exit path?
These questions develop client-lawyer dialogue to design and create a tailored solution. Each also has enormous relevance for drafting classic types of clauses for documents such as a constitution, venture agreement and related independent contractor and employee agreements, as well as:
Agreement recitals, duration, territory and scope
Intellectual property definition and management
Warranties, indemnities, liquidated damages
Restraint of trade clause
Termination and consequences of termination
Governing law and jurisdiction
Thus the reality check for clients, law students, graduates and even practising lawyers is this: there are under-appreciated non-legal dimensions to practice today in a commercial law firm context.
Three of these non-legal dimensions stand out.
Dimension 1. Operate like in-house counsel
Clients do not want their lawyer sitting on the fence pontificating on available options and asking the client to select between “options a, b, c, d or e…”.
Instead most desire a commercially-minded lawyer with the competency to translate and apply the law to their commercial and operational needs, and to fashion a definitive, customised and comprehensible solution.
For example, in contract drafting, an experienced and broad-thinking commercial lawyer should be able to identify from conversations with a client that a short, letter format agreement might do the job. This may be because the parties involved are individuals and the obligations involved can be stated briefly.
With this example the lawyer identifies the options (eg long or short document), adopts the preferred option and explains why it is best.
Recommendation: The complexity of the regulatory, legal and broader business environment now requires private practice lawyers to virtually operate like in-house staff or in-house counsel integrating legal and non-legal areas of knowledge relevant to the client’s affairs.
Dimension 2. Establish product development operations
The need for speed and costs minimisation is now a given. There is also nowadays a common misguided expectation by inexperienced people in business that professional services should be product-like. These factors gear business clients towards services that appear to be “plug and play” like products.
The expectation exists even though it is often misguided because clients rarely have the knowledge to identify the form of legal advice or product they require. Nonetheless, business is lost if a lawyer cannot promptly recognise and connect the client’s circumstances with a particular work product. It might not have the quality (and hence cost) of a tailored solution but it might provide at least an economical, acceptable packaged solution.
These circumstances require greater investment by lawyers in knowledge management and hence maintaining and using pre-existing or pre-defined template documents, workflows and processes. The benefit is time and costs savings for both the lawyer and the client.
Of course, not everything can be created with pre-existing products. When a problem is complex, or an original solution is sought, there needs to be greater understanding, funds and time applied.
Recommendation: For rapid customisation specific business, industry and other non-legal knowledge must be acquired or maintained by law firms for development and continuous improvement and updating of templates, workflows and processes.
Dimension 3. Adapt to change
Information technology skills have become more important to lawyers than ever before. Without them business lawyers cannot provide the services now expected.
A major misunderstanding by fresh law graduates (and clients) is that the lawyer’s job is over once legal advice or documentation is supplied and discrete client matters are finalised. In business law practices this is now only sometimes the case.
The lawyer’s desk and the client’s stationary or mobile workplace are today linked even “after hours”. A lawyer is a few seconds away, no longer just due to email, but also due to:
instant messaging and communication, eg iMessage, WhatsApp, Skype, Google Hangouts, FaceTime
cloud storage of documents, eg on Sky Drive, Dropbox, Box, Google Drive, iCloud
online collaborative platforms or dashboards, eg extranets, Asana (task management), Google Docs, Microsoft 365
A consequence of all this IT is changing habits and practices leading to an increasingly networked economy. This economy involves lateral integration and previously unimagined levels of collaboration at a global scale in such business functions as legal research, litigation discovery, social media alerts and marketing of legal services and collaborative online document drafting.
With this hyper connectivity, many clients expect lawyers to be readily available document managers who can rapidly access documents and provide prompt advice relating to both past and present matters.
This level of support, with systems integration and speed of access, was not expected in traditional legal practice. It has many implications which are being discovered for what is expected of lawyers. Among many decisions to be made is whether a law firm should experiment with new ways of working.
The new environment for legal services presents opportunities for some lawyers, law firms and legal tech start-ups. For other lawyers client expectations may have become unrealistic, dangerously stressful and sometimes unprofitable for them. For all, survival requires adaptation guided by this concept (often incorrectly attributed to Charles Darwin):
“It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”
Recommendation: Whether you are a young or experienced lawyer, think ahead, you have decisions to make. There are many options, eg you can maintain your practice or career path, embrace change, reinvent, or join or found a legal tech start-up.