Back to: What are we trying to solve for?
I submit that, in this Post Great Reset market, we’re trying to create or evolve or reaffirm the essence of each of our firms such that they have a distinctive and recognizable place in clients’ eyes which is:
- credible—in the fundamental and essential sense that everyone believes your firm can stake a claim to what you’re purporting to stake a claim to;
- distinctive—meaning not every Susan, Dick, and Harry firm can claim that same position; and
- beneficial to clients—meaning it’s something they care about and will value, select you for, and pay for.
In Corporate Land, this is often called the brand’s “Unique Selling Proposition.”
Now, I’m not going to rehearse the taxonomy I’ve created to date—the Cliffs Notes version is here—but I hope it’s clear to moderately attentive readers that I’m skeptical about the half-life of firms in some of the categories. And it’s not because firms in the threatened categories are doing things wrong. It’s both subtler and more menacing than that.
The signal reality of our post-reset world is that clients are increasingly calling the shots. Firms that continue to operate on one or more of the assumptions that
- (a) clients are price-takers;
- (b) cost-plus (the billable hour) has gotten us this far so what’s not to like;
- (c) in recruiting associates, pedigree trumps everything else (actually we think we don’t even need to know anything else);
- (d) the rich rewards we’ve been able to deliver to our equity partners heretofore speak for themselves; and/or
- (e) nothing needs to change because you can’t argue with decades of success
are going to find the marketplace hostile.
The way this works out—don’t take my word for it—is as devastatingly described and critiqued in Harvard Business School Professor Clayton Christensen’s classic The Innovator’s Dilemma. To wit, incumbents challenged by disruptive upstarts redouble their focus on doing what they know how to do best (meaning serving the same clients the same way only more so) while the upstarts slowly at first but inexorably over sometimes shockingly short timeframe’s move upmarket until the incumbents’ best clients realize they have a clearly superior alternative. Game over.
Let’s go back to where we came in here: What are the themes of the law firm taxonomy series?
- The days of one-size-fits-all law firms, if they ever existed, are receding farther and farther into the past. Targeted specialization and deep expertise is more and more the order of the day.
- Clients are increasingly discriminating about what legal services they buy and under what terms, but you’d be mistaken to think it’s all about the uni-dimensional element of price. It’s about perceived value, which is entirely different. We won’t here digress into the n-dimensional space of what constitutes value in a client’s eyes, but suffice to say there’s a lot more to it than price.
- The composition, structure, and (it’s not too much to say) essence of most firms is not the result of logic or purpose or intention, but of history, circumstance, and opportunism. Yes, luck may have (and has) shined brightly on many firms, but counting on that to continue as a business strategy going forward is not odds-on a winning hand to play.
So I’ve found myself asking what a law firm purpose-built to meet specific client needs, and which can simultaneously duck the relentless pricing pressure associated with disruptive innovators and market-empowered clients, would look like.