Wednesday, October 31, 2012
I don't know about you, but when I think about innovative industries, the legal field (specifically law firms) is one of the last that spring to mind. We can turn to Sarah Kaplan and Eric Beinhocker's questions in "The Real Value of Strategic Planning" to quickly see just how immutable the legal field actually is.
1. Industry youthfulness? About 150 years old in its present form (though we all know that even dinosaurs had lawyers)
2. Concentration? Vastly overconcentrated. What did Shakespeare say? "Kill all the lawyers?" This wasn't what he was talking about, but reversing overpopulation may have been a positive externality if his declaration had come to fruition.
3. Growth rate? Completely stagnant circa 2009.
4. Innovation rate? Nope.
5. Rate of tech change? Shockingly slow compared to other professions.
So yes, about as malleable as a stone tablet.
But there are a couple of pinlights in an otherwise dark tunnel, one of whom I worked for this past summer. A firm who ten years ago decided that their clients would appreciate it if they offered similarly high-quality lawyers, often relative newbies, at a drastically reduced rate. And what did they offer the lawyers? Quality of life. Control over their schedule. Weekends. Telecommuting options. It was an absurdly crazy idea (see: Apple commercial circa 1997), but somehow it worked. The firm located the office to house these lawyers in a low cost of living area to cut down on overhead, and it is still thriving today.
I've spent the past six months wondering, how did they know? How did they know that the legal market as it was once known - the land of milk and honey (yachts for everyone!) - would collapse. That high-quality yet cheap lawyers would become a major selling point for clients.
Reading our articles for this week, a lightbulb went off. While every other firm seemingly on the face of the earth was employing classic strategy, this firm's CEO had switched to an adaptive strategy. He was still trying to optimize the firm's position in the industry versus pulling a game change, but he acknowledged that the profession was changing - that it was not as predictable as previously believed. In “Your Strategy Needs a Strategy,” Reeves, Love, and Tilmanns reference using a flexible supply chain as a strategy for organizations in industries that are unpredictable but immutable. In its own way, this law firm has done just that by decreasing costs (with cheaper associates) at the bottom of the chain. Of particular note, this firm may have successfully implemented its crazy idea in part because of its leadership’s dedication to ensuring that people up and down the organizational chart know how the strategic plan translates into day-to-day choices for them… to the point that the clearly defined Vision Statement is prominently featured on each employee’s desktop.
But now, this firm has not only optimized its position in the market but fundamentally changed the game. Now that the legal market is both unpredictable and, as this firm showed, malleable, should shaping strategies be employed instead of adaptive strategies? What about the fact that it is unpredictable how long this archaic field will remain unpredictable?