Transcript Document

Driving Change at the Coal Face of Law
Presented by:
Sally R. Gonzalez
[email protected]
Today’s Topics
• Law Firm of Future – What’s driving change?
• Lawyer personality traits – Help or Hindrance?
• How to promote disruptive change?
• What technology innovations should we be monitoring?
– Future technology trends from ILTA’s Legal Technology
Future Horizons Study
Today’s Pressures on Profitability
•
•
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Demand for legal services remains flat, 5 years after the financial crisis
– Large law firms competing for shrinking pool of high-end work
– Firms have to take work from others to maintain/grow revenue
Revenue growth remains sharply constrained
– Pre-2008: Double digit growth
– 2013: Revenue grew 2.5% (Citi Private Bank Survey of 180 firms)
Stratification of firms continues to widen
– 50-top grossing US firms materially outperformed others in
profitability (Citi Survey)
– Global firms with strong international presence showed the biggest
revenue gains (Citi Survey)
– 2013 Revenue growth ranged from +20% to -21% (Wells Fargo Private
Bank)
•
Firms that aggressively managed expenses and pruned unproductive
partners are doing better than others
Source: …Big Law Firms Have a Big Revenue Problem; Wall Street Journal; February 25, 2014
The New Normal is Here to Stay
• “Well, in our country,” said
Alice, still panting a little,
“you’d generally get to
somewhere else – if you run
very fast for a long time, as
we’ve been doing.”
• “A slow sort of country!” said
the Queen. “Now, here, you
see, it takes all the running you
can do, to keep in the same
place. If you want to get
somewhere else, you must run
at least twice as fast as that.”
Lewis Carroll, Through the Looking
Glass and What Alice Found There
What Does the GC want? Value…
• “What corporate clients want and need: value driven,
high quality legal services that deliver solutions for a
reasonable cost and develop lawyers as counselors (not
just content-providers), advocates (not just process-doers)
and professional partners.”
Source: The ACC Value Challenge Project
What Does the GC Want? A Partner…
• Top 3 ways for GC to deliver value today: reduce time, risk
and cost
• Achieving best legal outcome less important today than 5
years ago
Top three ways in which corporate legal teams demonstrate value
Now
60%
Source: Deloitte Touche Tohmatsu
60%
50%
56%
55%
54% 54%
49%
40%
Five years ago
48%
44%
45%
43%
42%
30%
30%
20%
10%
0
Source: Deloitte Global Corporate Counsel Report 2012
Law Firm of the Future
• Size will matter – both bigger and smaller
• Location will matter – serving global clients and emerging
nations
• Expertise remains key, service delivery models will morph
• Competitors will change
– In-house law departments
– Dynamic virtual law firms (e.g. Axiom)
– Alliances (e.g., LexMundi)
– Specialist service providers for disaggregated services
– Non-legal professional service organizations
• Project Management and Process Improvement will become
embedded
• Innovation will be a differentiator
Law Firms Respond –
Legal Project Management
• “Doing things right”
• Training lawyers in project
management
• Increasing formality
around pricing up-front
and managing to budget
over time
• Formalizing
methodologies and tools
for matter management
BESPOKE
IN-HOUSE
SOLUTIONS
Law Firms Respond –
Legal Process Improvement
• “Doing the right things”
• Streamlining legal processes
• Resourcing strategically
– Assigning work to the lowestcost, qualified resource
– Out-tasking as appropriate
• Building bespoke technology
platforms and resources
– Delivering information justin-time in context with task
(“path finders”)
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 Production Plan
 Takt Demand
 Capacity Planning
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TPM
Visual Control
Standard Work
Takt Boards
5-Minute
Briefing
Project Selection
Project Charter
$IPOC
Process Mapping
 $PC
 Control
Value Steam Map
Time Study
Inventory Turns
Spaghetti Diagram
 C&A
 M&A
 Potential
Capability
 Pareto
 Fish bone
 Multi-vari
 Hypothesis
Plan
 Process
Audit
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FMEA
ANOVA
DOE
R3M
5$
Line Balacing
Kanban Pull
A Single Place Flow
$MED
Time & Motion Study
Work Cells
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Testing
FMEA
Pareto
DOE
$PC
 Process Cycle
 Setup Reduction
 Part
Stratification
 TOC
Law Firms Respond –
Innovate
• Develop broad, yet specialized services to support global
clients
• Improve existing services to achieve profitability objectives
• Create new services and service models to buffer revenue
streams from downward pressures on legal spend
– Non-legal professional services
– Ancillary business units
Today’s Topics
• Law Firm of Future – What’s driving change?
• Lawyer personality traits – Help or Hindrance?
• How to promote disruptive change?
• What technology innovations should we be monitoring?
– Future technology trends from ILTA’s Legal Technology
Future Horizons Study
What’s Unique About Lawyer Personalities?
• Measuring Lawyer Personalities with the Caliper Profile
– Measures 18 separate and distinct personality traits
– Administered to more than 2 million college-educated
subjects over past 40 years – well validated instrument
– Administered to more than 4500 lawyers over past 10
years by Dr. Larry Richards
– Results: Lawyers vary substantially from the norm on
6 of the 18 traits
• Reflects US-based lawyer population; culture session may
reveal differences in Asia-based lawyers
Skepticism
Symptoms of highly skeptical people? Pervasive
questioning of facts and authority, sometimes cynical,
judgmental, argumentative, and self protecting.
100
90
80
90
70
60
50
50
40
30
20
10
0
Lawyers
General Public
Autonomy
Resistance to being managed, dislike being told
what to do, prize independence.
100
90
80
89
70
60
50
50
40
30
20
10
0
Lawyers
General Public
Abstract
Reasoning
Ability to detect and theorize fact patterns and
cause/effect relationships, that are not readily
apparent, and which may or may not be relevant.
100
90
80
70
82
60
50
50
40
30
20
10
0
Lawyers
General Public
Urgency
Symptoms? Impatience, a need to get things
done, and a sense of immediacy.
100
90
80
70
60
71
50
50
40
30
20
10
0
Lawyers
General Public
Personal
Resilience
Symptoms of low resilience? Defensive, resist
accepting feedback, and hypersensitive to
criticism.
100
90
80
70
60
50
50
40
30
20
30
10
0
Lawyers
General Public
Sociability
Desire to connect with people, comfort in
initiating new relationships with others, having
emotional conversation with others.
100
90
80
70
60
50
50
40
30
20
10
0
12
Lawyers
General Public
Does This Make Sense Now?
Implications:
Project Management is a Challenge
• Lawyers are not naturally team oriented
– High Skepticism and Autonomy combined with low
Sociability and Resilience undermine team behaviors
– Compensation system is competitive (in U.S.)
– Lawyers are tough-minded and tolerant of conflict—so
they get stuck in “Storming” phase of team formation
– Teamwork is unfamiliar — not generally used in law
school
• Urgency works against planning and managing to plan
• Typical lawyer does not have personality traits needed for
effective project management
Implications:
Process Improvement and Innovation are a Challenge
• High skepticism and autonomy can kill new ideas,
especially other’s ideas, at inception
• High abstract reasoning promotes analysis paralysis rather
than crisp decision making
• Urgency works against reflection for process improvement
• Low resilience undermines investments in R&D
– Works against innovator’s mantra of “Fail quick and
fast”
Today’s Topics
• Law Firm of Future – What’s driving change?
• Lawyer personality traits – Help or Hindrance?
• How to promote disruptive change?
• What technology innovations should we be monitoring?
– Future technology trends from ILTA’s Legal Technology
Future Horizons Study
Thesis
• Project Management, Process
Improvement and Innovation are
disruptive changes in a law firm
• Business Services leaders and
teams are well positioned to
pioneer disruptive change BUT
also need to avoid arrows in
their backs
• Promoting disruptive change
benefits from a “Diffusion of
Innovations” method
About Diffusion of Innovation (DOI)
• DOI seeks to explain how innovations are adopted within a
population
– Innovation = an idea, behavior, or object perceived as new
by its audience
• Provides 3 insights into social change process; tested in more
than 6000 research studies and field tests and among most
reliable in social sciences
1. Qualities that make an innovation spread
2. Importance of peer-to-peer conversations and networks
3. Understanding needs of different user segments
• Standard text: Diffusion of Innovations, Everett M. Rogers, Fifth
Edition 2003; Free Press, New York
1. Qualities That Make Innovation Spread
Quality
Description
Relative
How much better is the innovation that what is currently
Advantage
available? How is the improvement quantified?
Compatibility How well does the innovation fit with the values, past
experience, and needs of potential adopters?
Simplicity and How easy or hard is it to understand and use the
Ease of Use
innovation?
Trialability
How easy or hard is it to experiment with the innovation
on a limited basis?
Observable
How easy or hard is it to observe the results of the
Results
innovation?
You should measure any innovation against these 5
factors to assess how difficult adoption is likely to be.
2. Peer-to-Peer Conversations are Critical
• Marketing may spread information about an innovation
BUT CONVERSATIONS SPREAD ADOPTION
– Face-to-face
– Social Media
• Why?
– Adoption involves management of risk and uncertainty
(two things lawyers struggle with)
– Only people we know and trust can give us credible
reassurances that our attempts to change will be
successful
3. Understanding Needs of User Segments
These are the user segments in any adoption population.
Remember…
• Persuasion does not make innovation spread
• Innovation spreads as new thing become easier, simpler,
quicker, cheaper, and more advantageous
• Each individual combines multiple user segments
– May innovate in one area and be a laggard in others
• During an innovation project:
– Analyze and categorize your user population
– Know which segment you are working with; design
your activities and pitch your communications
accordingly
Circling Back to LPM and LPI
• Will a simple training approach address the full range of
innovation segments in your organization?
• Does a more pervasive Lean Sigma approach fit better?
• What role does an After Action Review fill?
• Is a multifaceted approach necessary to satisfy a broad
range of needs in the full population?
Project
Management
Process
Improvement
Diffusion of Innovation
Circling Back to Innovation
• For internal innovation, what organizational structures or
institutional approaches might be used to:
– Ferret out the bright ideas of the innovators?
– Apply diffusion of innovation concepts to promote
adoption the innovation?
• If you are trying to introduce an innovation originating
outside the organization, how should you leverage
diffusion of innovation concepts to achieve your goal?
Today’s Topics
• Law Firm of Future – What’s driving change?
• Lawyer personality traits – Help or Hindrance?
• How to promote disruptive change?
• What technology innovations should we be monitoring?
– Future technology trends from ILTA’s Legal Technology
Future Horizons Study
Objectives of ILTA Legal Technology
Future Horizons Project
•
Identify key business, legal and IT trends and developments
•
Build timeline of emerging technologies and IT developments
with high potential legal impact
•
Explore IT’s transformative role in future legal business
models and service differentiation
•
Highlight strategic imperatives for effective use and
management of legal IT
•
Conducted January – December 2013
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Publication – March 2014
•
6 Sponsors
•
Combined desk research, interviews with managing
partners, CIO’s, vendors, futurists and technologists, global
surveys on the business applications of IT (499 responses)
and emerging technologies (223 responses)
•
Key findings are presented on the following pages including
the highest ranked responses in the surveys
Financial Innovation is the New Normal
e.g. Assets ‘Usership’ vs. Ownership
Rapid Execution e.g. Superfast Construction
Ark Hotel - Dongting Lake – China – 15 days
“How long do I need to wait to get your due diligence results?”
http://www.dailymail.co.uk/news/article-2083883/Ark-Hotel-construction-Chinese-built-30-storey-hotel-scratch-15-days.html
Our Technologies are Evolving
From Desktop to Mobile ...
...to Wearable...
...to Embedded...
…and totally Connected via
‘The Internet of Everything’
“What happens when the smartest thing in the room is the room itself?”
Madeleine Albright
Artificial Intelligence is Going Mainstream
88%
AI advisers /
helper apps will
structure legal
documents and
check content
generated by
lawyers
Speech / gesture / image recognition, integrated analytics, knowledge management, image / video
/ voice mining, client self-service, intelligent documents, expertise systems, collaboration, secure
email, virtual assistants, intelligent agents and collective intelligence
Questions?
Appendix
-- Working With the User Segments -Innovators (2.5%)
Characteristics
How to Work With Them
• Love to try and talk about new • Find them and engage them
things
• Provide support and publicity
• Don’t expect new things to be
for their ideas
easy or perfect
• Invite them to be partners in
• Known by majority as “outliers”
designing your project
or “crackpots”
-- Working With the User Segments -Early Adopters (13.5%)
•
•
•
•
•
Characteristics
Don’t need much persuading
Leap in once benefits start to
become clear
Quick to connect innovation to
their personal needs
Love having advantage over
their peers; will invest
time/money to get it
Like to talk about success
•
•
•
•
How to Work With Them
Offer strong, face-to-face
support during trial period
Reward egos with recognition
Leverage as peer educators
Maintain relationships
-- Working With the User Segments -Early Majority (34%)
•
•
•
•
•
Characteristics
Moderately progressive
pragmatists
Won’t act without solid proof
of benefits
Cost sensitive and risk averse
Wary of fads; want “industry
standard,” and “endorsed by
normal folks (like me)”
Want simple, proven, better
ways to do what they do; ways
that take no time to learn and
create no disruption
•
•
•
•
•
How to Work With Them
Stimulate interest with prizes or
competitions
Share endorsements from
credible, respected, similar
people
Redesign for ease and simplicity
Simplify instructions & education
Provide strong support
-- Working With the User Segments -Late Majority (34%)
•
•
•
•
Characteristics
Conservative pragmatists
Hate risk and uncomfortable
with innovation
Fear not fitting in; will follow
mainstream fashions and
established standards
Influenced by fears and
opinions of laggards
•
•
•
•
How to Work With Them
Promote social norms rather
than just benefits of innovation
Share endorsements from
other conservative folks like
them that innovation is normal
and indispensable
Emphasize risks of being left
behind
Defuse criticism from laggards
-- Working With the User Segments -Laggards (16%)
Characteristics
• Hold out to the bitter end
• See high risk in adopting the
innovation
• Spend time thinking up
arguments against the
innovation and are vocal about
concerns
How to Work With Them
• Provide high levels of personal
control over when, where,
how, and whether they adopt
the innovation
• Promote familiarity with other
successful innovations
• Promote success of laggards
who do adopt innovation
Always be mindful:
• They might be right; they might be innovators of
ideas so new they challenge your paradigms
• They can undermine progress with late majorities,
so don’t ignore them