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Practice management: Breaking the mould

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Cite as: December 2015 89 (12) LIJ, p.74

Emerging and alternative business models are being adopted by a large and diverse range of providers.

With increasing pressures disrupting and reshaping the legal profession and its markets, there have been increasing calls to change the way lawyers work.

Beaton Research and Consulting chair Dr George Beaton coined the term NewLaw with the blog “The rise and rise of the NewLaw business model,” which canvasses recent developments in the legal services profession, specifically the rise of providers that do not fit the traditional law firm mould.

Canadian analyst and consultant Jordan Furlong of Edge International broadened the concept of NewLaw to “Any model, process, or tool that represents a significantly different approach to the creation or provision of legal services than what the legal profession traditionally has employed”. This covers law firms and also “new legal talent combinations, legal service managers, and legal technology” that change how lawyers practise and how clients access legal services.

In summary, NewLaw is shorthand for the various emerging and alternative business models being adopted by an increasingly large and diverse range of providers. It describes the business model of the law firm or legal services provider; that is, how the organisation intends to make money via its combination of customers, value propositions, key resources, key activities and finances (revenue and costs).

There is no single business model for NewLaw. However, there are common themes including emphasis on clients, access to legal information, awareness of branding, importance of talented people, focus on efficiency and standards, use of technology, new look workplaces, value-based pricing and, always, a mindset of innovation and flexibility in the delivery of legal services.

Jordan Furlong suggests two broad categories of NewLaw business models:

  • aligning human talent with legal tasks
  • applying technology to the performance of legal tasks. He observes that many new legal talent arrangements are found in the UK (and Australia) while the majority of technology solutions are found in the US. There are also hybrids or combinations of these.
  • Within the first category are subgroups of new-model law firms such as fixed fee law firms and virtual-only law firms. Another subgroup is Project/Flexible/Dispersed legal talent providers that provide to (often) corporate clients the services of lawyers with pedigreed credentials to work flexibly from mobile office or home, for set periods or on a project basis, and at a competitive price. A third subgroup is managed legal support services such as legal process outsourcing (LPO), specialised back-office centres, outsourced legal document management, review and analysis, and intelligent automated commercial contracts drafting.

    Within the second category are three subgroups of technology-based tools: tools to help lawyers in legal work, tools to help clients resolve disputes directly and tools to help clients conduct their own legal matters. Examples include online legal forms, expert legal applications, graphical data visualisation, DIY probate, online document retailers, automated contract assembly engines, guidance on the best way to negotiate and sign documents online, collated multi-disciplinary information about legal areas, and advanced predictive analytics software.

    Where to from here?

    For Australia, NewLaw is more than just a passing trend. The market has shifted, changing the way clients use lawyers and pay for legal services.

    The emergence and early success of NewLaw is answering the increasing market demand for legal services that are equally capable and competent, and also more innovative, accessible, efficient, and more staff as well as client-oriented.

    These NewLaw business models are available to all legal service providers. Some law firms will find this challenge to change and innovate easier to implement than others. What is your response?

    Judith Bennett is a lawyer, business consultant and coach for the legal profession at www.Business4Group.com.

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