Greetings from the right side of the pond: Impressions and observations from a wide-ranging series of conversations and meetings over the past few days.
Overall, the market here strikes me as a few years beyond—more evolved—than the US market. Why this is so I have no theory, but firms in general talk more crisply, with more precision and resolution, about the need for a clearly articulated and distinctive strategy, and more importantly, can do a credible job of explaining w that strategy and positioning will offer the a distinction that clients can benefit from and understand in ways that are self-evident. Most UK firms can do this persuasively and with force; most US firms cannot.
The prospect of ABS (alternative business structures) under the Legal Services Act, is on everyone’s tongues. Both the current reality and the prospect of still speculative future developments have people talking—and acting. One firm demonstrated its commitment to investing in “near=sourcing” by opening an office in “the north” that went from a standing start to fourth largest tin the firm in six months. What potential new business models mean to the “High Street (roughly, retail consumer/family/personal injury law is already dramatically clear in the form of Slater & Gordon and its brethren; what it might mean to BigLaw is unknown but plausibly expected to cause real dislocation once sophisticated business processing optimization professionals put their minds to it.
Whether the dark and primitive jingoistic impulses of certain cohorts of the US bar can barricade these markets at the water’s edge is a topic for another day.
Globalization is not only real and here to stay but UK firms take it profoundly to heart. The reality of being a “sceptre’d isle” has historically had profound implications for British military, political, and economic actors,, and if anything today’s hypernetworked world has made that more true than ever. When you’re a 243-thousand square mile nation of 63 milllion people (the UK) and not a 3,718-thousand square mile nation of 318 million people (the US), any large ambitions will soon have you looking abroad.
A close corollary is the profound dominance of London: The largest city in Europe, it has 12% of the UK population and accounts for 31% of total UK GDP. The imaginary equivalent of London in the US, if such existed, would be a combination of New York, Los Angeles, Chicago, Dallas, Houston, Boston, San Francisco, Philadelphia, Atlanta, and at least a dozen more cities.
But that’s not all. After London, there is no other city in the UK that’s a close second. New York looms large in the US, to be sure, but it accounts for only about 8.5% of total US GDP, barely a quarter of London’s proportional share of UK economic activity.
The resulting attitudinal distinction is crystal clear; talk in the UK takes the prospect, if not the necessity of extraterritorial expansion as a given.
With scale come certain advantages.
You may tell me this is not news, and I would hasten to agree. The difference is that while it may be a topic for episodic musing in the US, it is a front and center management reality in the UK that tends to come up early in any thoughtful conversation: a striking difference.
Whether this reflects the psychological weight of the omnipresent notion of the Magic Circle (there is no such equivalent US moniker) is speculation. I invite you to indulge in that among yourselves.
A quick digression into a “bonus round” of relative strengths between the two financial capital cities, and then some final thoughts.