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jerryking : billable_hours   2

Why law and accounting firms struggle to innovate - The Globe and Mail
Oct. 06, 2015 | The Globe and Mail | RYAN CALIGIURI.

Why is it that professional service firms, especially accounting and law firms, find it so difficult to embrace innovation in order to build a stronger future?...The biggest factor is that professional service firms are driven primarily by billable hours and any time someone is not billable they are seen as not adding value. This means that in order to innovate someone has to “stop adding value” by not being billable. There is far too much focus on “today” in professional service firms and not enough on the future – this mentality will continue to hold back firms and do more damage in the long run....Most professional service firms also don’t have a system for driving innovation in an efficient manner so they often waste a great deal of time getting caught up in details that don’t matter. ...Many of the law and accounting firms I worked with were doing very well so they didn’t see a need to innovate. ....Firms are often not good at implementing new services or products, they don’t have a culture that supports, fosters, or encourages innovation, and they are often too smart for their own good and get overly complex with their innovation initiatives......First, a firm’s overall corporate strategy needs to incorporate an element of innovation as one of its top long-term goals. Without a strategic focus and investment in innovation, any efforts will often fall flat as they will be approached loosely or in a silo that eventually gets overtaken by billable work.....Next, get a quick win by surveying or researching your client’s business, their industry, and even their own clients. Looking deeper into your client’s business and understanding their problems and opportunities will help you find ways to add value through a new product or service and will enable your firm to get off on the right foot.....Insights from clients can drive new products, services and systems that will fill a need.
However, professional service firms that are looking for a leap in innovation need to go beyond customer insights and explore future trends, industry experts, and, yes, even patent databases for further stimulus to drive new ideas.
This is the difference between firms that innovate and those that die. If you’re in a professional service firm and believe that there is no threat, quite frankly, you are crazy to think so.
innovation  professional_service_firms  law_firms  quick_wins  accounting  challenges  billable_hours  complacency  disruption  Ryan_Caligiuri  silo_mentality 
october 2015 by jerryking
Legal Rebels - 5 Business Model Innovations Solos Need to Truly Compete with BigLaw
With the financial crisis of 2008-2009, every part of this old model has come under scrutiny, even in a traditionally high-end field like IP litigation. Specifically:

Leverage. Leverage, or the associate-to-partner ratio within a firm or practice, is good for reportable profits per partner. But it is not necessarily good for clients. As clients push to cut litigation costs, leverage declines. This trend favors solos and less-leveraged practices.

Within One Firm. Historically, the transaction costs associated with assembling a team of lawyers not located under the same roof made it prohibitive to build a competitive litigation team from a network of solos. But the rise of Web 2.0 is changing that. With my LinkedIn/Facebook/Outlook network of colleagues, I can identify, customize and assemble a team in less time than it used to take to walk the halls of my old BigLaw firm. But we need innovation in the areas of contractual arrangements and the laws governing lawyers to fully deliver on the promise of the ad hoc, Web 2.0, virtual law firm.

Customized. In most areas of law practice, as the field matures, more and more aspects of the discipline become standardized.

Off the shelf. The opposite of build-it-by-hand-from-scratch-every-time [JCK: *bespoke*] . Compared with some other fields of law, IP litigation has been fairly slow to progress in this manner. It has therefore remained—relatively speaking—profitable custom work. But we are starting to see some indications that aspects of IP litigation are being made more routine, even standardized. This is a good development for the solo IP litigator. As formerly labor-intensive-but-routine pieces of IP litigation evolve into off-the-shelf modules, we are freed up to apply our creativity and good judgment to the more strategic aspects of the case, with a diminished need to spend time supervising large teams as they custom-polish a third set of interrogatories or research for the nth time how to apply the Brown Bag Software case to a two-tiered stipulated protective order. Innovation in off-the-shelf litigation modules is starting to arrive, and more is needed.

Billable hours. It has been proclaimed and repeated that the billable hour is dead. Well, maybe not quite. But it is certainly open to competition from alternative fee arrangements. We have enough data and experience now that we can start to accurately predict IP litigation costs. And we can bill a la carte, charging fixed fees for different pieces of litigation. A menu might include one fixed fee for pleading-through-pretrial conference, a per-deposition fee, a per-custodian document discovery fee and so on. Models continue to evolve. Clients want their lawyers to share the risk—to have some “skin in the game”—and to have incentives for efficiency. Innovative billing models are coming.
ad_hoc  bespoke  Big_Law  billable_hours  business_models  competitive_landscape  dissolutions  Facebook  gig_economy  JCK  law_firms  leverage  LinkedIn  Michael_McDerment  networks  patent_litigation  project_management  off_the_shelf  on-demand  risk_sharing  short-lived  short-term  skin_in_the_game  solo  standardization  teams  transaction_costs  
october 2010 by jerryking

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