Edge International Communiqué
Edge Logo
Insights and Analysis from Edge International, the Leading Global Consultancy t
o the Legal Profession

May 2011  


Waiting for the Rain

For what is really the first time in U.S. legal history, law firms must compete for clients.  That's why a the concept of "competitive intellegence 


By Ed Wesemann



The practice of law is maturing.  That's not a bad thing.  It simply means that the practice of law, some 800 years after its creation as a discipline, can't really be categorized as a "growth industry" anymore.  Now, there are all sorts of ramifications from being cast as mature but one of the most distinctive is competitiveness.  Increasingly law firms, for what is really the first time in U.S. legal history, must compete for clients.


In a growth industry, firms don't actually compete with each other.  Oh, they may occasionally go head to head over a client but, on balance, there is plenty of work to go around.  As a result, to be competitive, a firm or a lawyer needs to make their qualifications known and some portion of the available work will come their way.  In fact, a big chunk of it may come from other law firms who are technically the firm's competitors but have more work than they want to handle.  I know a managing partner who has a cartoon in his office depicting a hopeful looking little bird looking up with its beak open, waiting for it to rain.  It is titled "Law Firm Business Development."


But in a mature industry there is competition, and, I suspect, most lawyers are seeing a level of competition for work that seems to be increasing almost daily.  Which is why a new marketing discipline is coming into play: Competitive Intelligence.  This may bring to mind complex strategies of moves and counter-moves designed to beat competitors.  But, before firms worry about whether it is ethical to use waterboarding to find out other law firms' secrets, there are some basic questions that firm's can ask themselves that will go a long way to building competitive intelligence.

1.    Who are our competitors?  Within a particular practice, the list is probably only 5 or 6 firms that you go head to head with on a daily basis.  If it's a lot more than that, it's a good sign that you are not a true competitor in that area.

2.   What is our reputation?  A lot of firms have a self-image that is 10 years out of date.  Take a couple of clients to lunch and ask them to candidly tell you what they hear.

3.    How much do we charge?  Not just your hourly rates.  What does a typical engagement in your practice area cost - all in?  Ask your accounting department to give you some stats. You may be in for a surprise. 

4.    What do you do for your best clients?  If the answer isn't everything, who else is doing their legal workand how do your firms compare?  Time for another client lunch.

5.    Are there industries that you really know?  Not just industries in which you happen to have clients.  Do you have lawyers who used to work in the industry or ties to a trade association?

Get answers for your practice group (or even your own personal practice) and you'll have powerful competitive intelligence that you can put to use immediately - without waterboarding anyone.

 Contact the author, Ed Wesemann

Deer in Headlights

Law firms faced with client demands for alternative fee arrangements and project management are having difficulty finding an appropriate reaction.


By Douglas Richardson


Much of our present work with law firms and legal departments focuses on a changing frame of reference: away from structuring legal work on the time it takes to produce it, and toward evaluating on the basis of the value it confers to the client - as seen through client eyes.  Put more simply, it's a move toward value-based billing and away from invoices based on the billable hours.


This "value perspective" has triggered significant changes in the way many clients select legal counsel and monitor their performance. Convergence programs - winnowing the pool of law firms used by a legal department - continue to increase even as the recession appears to ease.  In addition, RFPs have increased by 300% in the last two years, and today's RFPs have assumed a more demanding tone: rather than asking "what would you charge?", clients tell firms what they will - and won't - pay, and increasingly they require bidders to explain exactly how they will manage their legal work efficiently and cost-effectively.  Alternative fee arrangements (fixed or flat fee billing approaches) are becoming more common as clients seeks ways to control or cap their outside legal spend.


All these developments have led to the emergence of Legal Project Management as a tool for driving efficiencies and cost accountability into the provision of legal services.  Firms and clients alike are instituting new legal process management and workflow tools and techniques.  The best of these involve an unprecedented degree of collaboration between client and provider in terms of scoping, planning budgeting, monitoring and communicating.


Right now, the biggest firms and the biggest clients are defining the face of RFPs, AFAs and LPM.  For them, the stakes are highest and the resources to implement these changes are readily available. The first-adopter law firms, notably Dechert, Orrick, Seyfarth Shaw, Reed Smith and Nixon Peabody, are creating large and visible tracks for first followers committed to updating their service delivery model.  McGuire Woods, Sutherland, and Baker Donelson, to name but three, now are very far along in building the tools and implementing the training needed to bring them up to the front line in value-based performance.


Yes, there have been firms that resemble "deer in headlights." In both large and mid-sized firms, some folks claim that all this value-based stuff is just a passing fad or that their clients are perfectly happy to continue hourly billing and casual oversight.  They hope and trust that as soon as economic factors permit, the profession will revert to time-honored relationships in which the law firms have the controlling hand.  Leaders in some firms tell us they aren't sure when and if they should dive into value-based planning and metrics; they suggest that they will wait for their clients to press them to change, rather than proactively suggesting value-based billing and service efficiency models.


While the push for AFAs and LPM are not overni

ght game-changers, we have little doubt that the trickle down effect to late-adopter firms will soon become a steady and powerful stream, soon to become a river.  The signs of a pervasive paradigm shift are clear: the Association of Corporate Counsel, made up of 34,000 in-house lawyers, continues to press its Value Challenge, designed to create a new, value-based model for inside/outside counsel relationships.  Numerous law schools have instituted LPM courses and programs, predicting that LPM will soon constitute the basic way of doing legal business.  We continue to receive more and more calls at Edge: How can we implement LPM in a firm our size?



Even if clients don't ask specifically for LPM, they are demanding greater cost-accountability and efficiency from their firms, whatever the firm size.  They are asking their firms for phase-coding, task coding, phase-based budgets and greater focus on actual-to-budget numbers. 


Implementing LPM in mid-sized firms will prove a different challenge from the huge rollouts in megafirms, but it can be made a manageable and affordable process that doesn't break the bank or significantly disrupt firm culture.  Increasingly, we are being asked to design lean and practical LPM implementation approaches tailored to the structure and budgets of mid-sized firms threatened with being marginalized as the value-based trend spreads across the profession.


The difference between a fad and a trend is that trends matter. They change the landscape and have lasting implications. The trend toward value-based service delivery most certainly is a trend, and those that don't hop on the bus will not be deer in headlights.  They will be deer in taillights. Contact the author, Douglas Richardson.


The Post-merger 'Golden Hour'

The first couple of months after a merger are critical to its success.  Getting it right requires careful pre-planning.


By Sean Larkan



 Within the health industry trauma and emergency clinicians will tell you that the critical period for a patient following a serious injury is the first hour, the so-called "golden hour."This is when decisions must be taken as to the type and seriousness of the injury, the nature and urgency of the care they may need and also about triage issues - getting the patient to the right facility on time.


The same can be said of mergers. The first three or four months, the merger "golden hour," is equally important. The important thing about this period in relation to mergers is that a lot of planning and thinking needs to take place pre-merger, but in relation to what happens immediately post-merger. It is too late if this happens once the merger has taken place, unfortunately a not uncommon scenario.


In the excitement of searching out merger partners, evaluating them and eventually consummating a deal, often not enough attention is given to pre-merger planning for the important things that need to be done in this critical period. It can make or break a merger and directly impact merger morale.


Here are some things to bear in mind:

·       undertake a pre-merger cultural audit of the two parties. While it is true that respective leadership teams often do not have the stomach for this exercise it can be critical in determining possible issues down the line. Most of these do tend to be cultural in nature and it is important that these are identified upfront to ensure they are properly managed and ideally eradicated. At Edge we have developed a simple, effective cultural diagnostic for this purpose.

·       in part flowing from such a cultural audit, develop, agree and communicate to all key parties (usually partners and senior support staff) post-merger guiding principles which should address items such as:

·       warning everyone that there are going to be differences; these should be discussed frankly but positively and ideally embraced. In many cases they can even be leveraged.

·       reminding everyone about the importance of collaborative behavior and the need to build constructive relationships. At the heart of this is to encourage straight talking and avoiding assigning blame or finger-pointing when issues invariably arise.

·       the need to manage one's own internal stakeholders within one's organization or operational area. This is particularly important amongst operational units and support services. The key managers in these areas need to be reminded of the importance of building trust, which can be broken down by mixed messages, broken commitments and unpredictable, inconsistent behavior.

·       the key role of leaders and senior managers and a reminder that it is what they do not what they say which matters. They should set the example of working to achieve success for their counterparts in the other firm and to build the self-esteem of others. When issues arise there should be a focus on the issue and not on the individuals concerned.

·       the need to get to know how the other party works and makes decisions, how they allocate resources and share information and to openly explore any challenges and differences which may be evident.


While some of these principles are more easily said than implemented, it is important they are discussed and explored pre-merger, to ensure that at the very least they are at the forefront of everyone's thinking. A simple, clear 'one-pager' covering these guiding principles can go a long way to pre-empting a lot of unnecessary issues.

·       carry out a risk review in relation to the merger. In the euphoria following merger decisions the parties often overlook this important step. It is not a difficult one and will ensure you have pre-warning of key issues, their potential impact and the level of risk or likelihood of them eventuating. Some consideration can also be given to possible mitigation steps. This often results in necessary steps (frequently in relation to clients or critical people issues) being undertaken at a very early stage.

·       appoint the right leadership and management to key post-merger roles and ensure that energy and most importantly, communication, is maintained in this critical first three or four months, post-merger. Invariably they will not have been involved in the hurly burly and excitement of pre-merger talks and in consummating the deal - they need to be brought fully on board and their responsibilities and accountabilities clearly outlined.

·       typically, systems integration is given attention pre-merger. However, it is vital that financial integration and all related activities be given particular focus. How smooth these systems operate post-merger, even in the early months, has a direct impact on partner and firm perceptions and morale around any merger.


These may seem like obvious steps, and some of them are. However, too often they are not given enough attention, pre-merger. Some active planning and decision-making during this period can ensure the merger 'golden hour' sets the scene for a successful fusion.  Contact the author, Sean Larkan





24 Social Media Resources for Legal Leaders

Read these  dispatches and you'll be fully informed about what's happening, and what will happen, to the legal services landscape.


By  Jordan Furlong


Most of the managing partners and general counsel I've met have plenty of interest in both the changing legal marketplace and the use of social media to track information and insight about that marketplace. What they don't have is the time to go searching for those sources themselves. This short article aims to fill that gap.



Below, you'll find ten blogs and ten Twitter feeds from lawyers, academics, journalists and consultants that track the latest twists and trends in the legal market. Read these 20 dispatches and you'll be fully informed about what's happening, and what will happen, to the legal services landscape. Each of these sources is free, and accessing them is as easy as setting up a Google Reader account (http://www.youtube.com/watch?v=-EvSul7Aisk)




3 Geeks and a Law Blog: Toby Brown, Greg Lambert and Lisa Salazar write maybe the best legal innovation blog now in operation.


Above The Law: You don't have to like it, but don't underestimate its power or its growing prestige as a bellwether of change in large firms and law schools.


Adam Smith Esq.: New York's Bruce MacEwen delivers a rare combination of sublime writing and strategic guidance for large law firms.


Legal Futures: Neil Rose's website has a blog, but the whole site is a must-read for the latest developments in the most important legal laboratory: London.


Law Department Management: Rees Morrison's blog is the deepest collection of data and insights on in-house law departments available anywhere.


LPO Source: Produced by legal process outsourcing provider Fronterion, this blog captures the latest news about the rising LPO wave.


Strategic Legal Technology: Ron Friedmann writes about offshoring and commoditization, taking the pulse on the legal workflow revolution.


The Belly of the Beast: Former Kirkland & Ellis partner and current adjunct professor at Northwestern Law School Steven Harper writes provocatively about BigLaw.


The Posse List: If you want to understand the rapidly emerging temporary and contract legal talent wave, this is where you need to start.


The Wired GC: John Wallbillich brings another (former) GC perspective to his ongoing deconstruction of the inside-outside counsel relationship.


And here are four more must-read blogs, from the partners of Edge International:


Amazing Firms, Amazing Practices: Edge International co-founder Gerry Riskin foresaw the economic crisis back in 2007 and continues to monitor the profession for major change.


Ed Wesemann: One of the world's foremost legal consultants regularly publishes his sharp-eyed assessments and practical insights for law firm leaders. 


At The Intersection: Pamela H. Woldow writes about general counsel, legal project management, alternative fee arrangements and the rising tide of change.


Law21: Dispatches from a Legal Profession on the Brink: Jordan Furlong's award-winning blog analyzes the extraordinary upheaval in the legal profession.


Twitter accounts

In addition to the Twitter accounts attached to the foregoing blogs, here are some more that I recommend.


@ABAJournal: Updates and links from the ABA Journal.


@AmLawDaily: News bulletins from The American Lawyer.


@eicdocket: Updates from Kim Howard, Editor-in-Chief of the ACC Docket.


@jasnwilsn: Analyses of the legal publishing industry from legal publisher Jason Wilson.


@KrebsatACC: President of the Association of Corporate Counsel.


@LawyerCatrin: Editor of Britain's The Lawyer newspaper.


@ronaldbaker: Founder of the Verasage Institute and crusader against the billable hour.


@StephenMayson: Director and professor of strategy at London's Legal Services Institute


@VMaryAbraham: Knowledge manager and counsel at Debevoise & Plimpton in New York.


@ValoremLamb: Trial lawyer and co-founder of Chicago's Valorem Law Firm.


You might not agree with the sentiments and perspectives expressed in some of these blogs or Twitter streams. But it absolutely will be worth your time to stay fully aware of what they have to say.

  Contact the author Jordan Furlong.




In This Issue
Waiting for the Rain
Deer in Headlights
After the Storm
Leaders...Are You Taking Care?


Gerry Riskin
Gerry Riskin, Anguilla,

Sean Larkan
Sean Larkan, Sydney, Australia
Pam Woldow
Pam Woldow,    Philadelphia, USA

Jordan Furlong
Jordan Furlong, Ottawa, Canada

Doug Richardson
Doug Richardson, Philadelphia, USA
Ed Wesemann
Ed Wesemann, Savannah,


John Plank
John Plank, Toronto, Canada

Juhi Garg

Juhi Garg




Stuart Benson
Stuart Benson, London, England

At The Podium: Upcoming Appearances by Edge Partners  

May 26, 2011: Jordan Furlong speaks at the Legal Marketing Association in Toronto, ON

June 2, 2011: Jordan Furlong speaks at Le Barreau du Quebec Annual Conference in Gatineau, QC

June 11, 2011: Jordan Furlong speaks at Nova Scotia Barristers' Society Annual Meeting in Halifax, NS

August 5, 2011: Jordan Furlong speaks at the ABA Annual Meeting in Toronto, ON

August 23, 2011: Jordan Furlong speaks at the International Legal Technology Association Conference in Nashville, TN

Edge Blogs

Jordan Furlong's 


Ed Wesemann's: Creating Dominance

Pam Woldow's At The Intersection

Gerry Riskin's Amazing Firms, Amazing Practices
Edge InternationalEdge International is a global consultancy that provides strategic advice and tactical guidance to law firms and law departments worldwide. Read more about us or contact one of our partners.