RICHMOND, Va., Oct. 25 /PRNewswire/ -- Predictability is paramount for corporations, and yet their outside law firms are usually far more intent on racking up billable hours than on providing the accountability and predetermined budgets that prevail throughout the rest of the business world. Little wonder, then, that dissatisfaction with traditional law firms is running high, writes Richard L. Upton, President of Richmond-based management consultants UPTONGROUP, in a new column on Forbes.com.
"From powerful corporations to fragile start-ups, companies across the country are fed up with the traditional law firm," he writes. "A recent survey by BTI Consulting Group found that executives at 87% of corporations said they would drop their outside legal representation if they could."
In "Why Businesses Are Fed Up With Their Law Firms: They are right to be, and here's what needs to be done about it" (http://www.forbes.com/2010/10/21/lawyers-law-firms-outside-counsel-leadership-managing-corporate.html), Upton notes that the current level of dissatisfaction has been building for some time. "Stories about $800-an-hour partners working on simple assignments typically tackled by junior associates or paralegals have been making the rounds for years," he writes. This longstanding friction, however, has less to do with such horror stories than with what Upton describes as "the basic and glaring difference between how corporations and law firms operate."
Corporations do business in a world of tangible expectations, set budgets and ever-increasing accountability to management, shareholders and stakeholders. By contrast, the individualistic style of attorneys and the retrospective billing practices of the legal profession represent a rejection of the predictability and accountability clients crave. However, Upton writes, there is another way: Corporations can "demand that outside legal representatives define their scope of work, implement 'right fit' staffing models and achieve predictive, cost-based accountability -- the same as a corporation expects from any other service provider."
"While this requires nothing less than a fundamental shift in a law firm's brand culture, it is doable," notes the veteran law firm and corporate consultant and former advertising agency executive. As they work to remove disruptive variables, maximize collaboration and candidly express all expectations, smart companies will also demand that their law firms do more than simply practice the law. "Corporate clients should demand that their law firms provide business judgment that is commensurate with their legal judgment," he writes. "They can and should seek firms that understand their businesses and the industries in which they operate. They should also look for firms that can come to the table offering insight and services ... that amount to a value-add."
The end result is a framework that enables corporations to finally modify the outmoded "billable hours" paradigm. While this adds up to a big change for both parties, today's law firms are worried about declining revenues and client dissatisfaction, and many are ready to change.
"Corporations therefore should have no compunction about bringing this new model to the table," Upton concludes. "Historically, they and their law firms have been unable to achieve something that is commonplace throughout the rest of the business world -- a truly collaborative relationship. Creating such a roadmap could lead both parties from rocky parallel tracks to a single path heading in the same productive -- and predictable -- direction."
UPTONGROUP, based in Richmond, Va., works with corporations and their law firms to structure productive, cost-effective relationships. President Richard L. Upton has provided marketing and change-management services to major law firms and businesses for more than 12 years, following a 23-year career in advertising and marketing.