While it’s true that many top law firms continue to enjoy a monopoly on providing legal services to elite clients, it’s becoming equally true that for the vast majority of the AM Law 200, that is not the case.
Many law firms are increasingly threatened by competition, not just from the top, but from all sides: nimble, niche law firms; midsize firms; tech-savvy legal providers; and even non-traditional sources, such as accounting firms.
But how much of the threat is this to traditional law firms, and further, are there opportunities amid all this competitive realignment?
We spoke to Umair Muhajir, Vice-President & Global Head of Legal Solutions for Thomson Reuters, about what he is seeing in the legal market around competition, capacity and client service. Muhajir will be part of a panel, titled, “Emerging Challenges to Law Firm Dominance: Trends in Legal Service Providers, Competition and Capacity” that will be held at the 41st Annual ILTACON 2018, on Aug. 19-23 in National Harbor, Md.
Muhajir will be joined on the panel with Dan Safran, President and CEO of LegalShift; and Daryl Shetterly, Director of Analytics Operations at Orrick, Herrington & Sutcliffe.
Legal Executive Institute: Can you tell us about the panel and what you are expecting from it? What are the challenges out there that firms are looking at?
Umair Muhajir: In the last 10 years, the way the industry has evolved and continues to evolve has challenged the tradition model of delivering legal services. And at one level, I think these challenges go to our very reason for existing as a business in the first place.
And I don’t mean to phrase it in any kind of adversarial sort of way, because I think one of the most interesting trends in the legal industry has been how traditional law firms and alternative legal service providers (ALSPs), such as legal tech companies and legal process outsourcing firms, have begun working together directly to better serve end-clients, who themselves are under extreme pressure to extract more value from their legal service providers.
You can attend the “Emerging Challenges to Law Firm Dominance: Trends in Legal Service Providers, Competition and Capacity” panel on Aug. 20 during the ILTACON 2018 Conference.
Add to this the trend we see in that the most capable ALSPs are showing signs of migrating up the value chain. These players are not only set up to do the heavy lifting on process-oriented, repetitive work, but they’re also increasingly taking work that traditional law firms would have done in the past. In litigation, for example, it’s not just e-discovery or document review and coding, but it’s now preparing depositions, prepping witnesses, developing case chronologies, among other work.
That’s a tremendous challenge to the work that traditional law firms have been doing for decades
The panel describes today’s legal environment not just as a challenge to traditional law firms, but also as an opportunity. How would law firms see working with ALSPs as an opportunity?
That’s a good question, and I think a lot of that depends upon a couple of factors to do with the law firms themselves, as to their staffing and billing models, as well as their industry and where their clients are in terms of working with ALSPs.
In those situations — especially where it’s more fixed fees and not pure hourly billable anymore — many law firms might well have an incentive to partner with ALSPs because their revenue is fixed in some sense. Additionally, it can cast the law firm in a supervisory role in the client’s eyes, which can only increase the firm’s value to the client.
What do you hope would be the main idea that you’d like attendees to take away from this panel?
I’d like attendees to start thinking of the competition in the legal market not as some sort of game where it’s law firms versus ALSPs. I think the emerging and more specialized nature of what different players in the legal ecosystem can do well means there are tremendous opportunities for everyone to partner to the end-client’s ultimate benefit.
For instance, law firms are optimally set up to do really expert, artisanal things; and ALSPs are typically not set up that way.
On the other hand, ALSPs are increasingly set up to be process-oriented, and to be experts on technology and workflow. If you frame it in that way, you can see there’s natural synergy there — it doesn’t have to be a hostile environment. And frankly, it increasingly isn’t.
You can also connect with Umair Muhajir and senior leadership at Thomson Reuters Legal Managed Services in Chesapeake D throughout ILTACON. Reach out to us if you’d like to schedule a time.