- Remaining unanswered for many (by no means all!) Canadian firms is the existential question of whether (1) to remain independent as far as the eye can see, being selective or promiscuous “best friends” around the world; (2) to selectively place small, primarily defensive brick & mortar outposts in key capital markets centers outside Canada (most obviously, New York and/or London); or (3) to be open to being courted or even dating or more. Our view is that this self-questioning and fortunately external-facing dynamic is not the type of question that can be resolved definitively so long as one is independent–except for the most extraordinary of firms. (See below.)
- Further on the same theme, the verein structure continues its polarizing march across the consciousness of law firm leaders as it has practically since it rose to visibility and people agreed on how to pronounce it. They’re innovative, flexible, ingenious, and logical, vs. they’re expedient, inherently unstable, and manifestly ill-suited to Law Land. (I exaggerate by not much.)
Our view is that the jury is still out on vereins. Nobody has tried this on the scale it’s now happening in Law Land, and it may end up where electric cars ended up a century ago (nowhere) or where they seem to be headed today (with, at the very least, a substantial and enviable market share). It’s just too soon to say. - Canada’s GDP in 2016 (in US$ for consistency) was $1.53 trillion or just over $50,000 per capita. California’s 2016 GDP was about $2.46 trillion or nearly $59,000 per capita and Texas was at $1.46 trillion and $53,000 per capita. This gives you a notional indication of wealth and market sizing.
As I’ve said before and will surely have occasion to say again, my training was in economics and not psychology but for reasons you can speculate on at home it struck us that there’s one deeply unattractive trait we often see in the US which is, refreshingly, nowhere to be found in Canada.. The missing emotional marker? A self-satisfied sense of entitlement.
When I say that charmless attitude was missing, what do I really mean? The leaders of Canadian law firms that we met with are realistic about matters such as the fact that their firms are for-profit businesses and need to be run as such; that powerful competitors are everywhere; that the GC/law firm partner dynamic has changed dramatically over the last decade or so (largely and understandably not to the benefit of the law firm); and that they must lead their firms, not just manage them. No special snowflakes in sight. - Finally, we’ve discussed each of the following issues elsewhere at length, but a quick rundown of some other topics Canadian firms seem to find every bit as thorny as their fellows around the globe:
- Compensation, which seems ever to be seeking equilibrium and never quite attaining it;
- Succession planning (both of firm management and of key client relationships);
- And talent management: Recruitment, retention, gentle and humane, but constant, culling of those who don’t belong.
IV.
I’ll conclude with our decision to write a future column whose timeliness and importance were cemented by this trip, although it’s a theory we’ve been exploring for quite some time now. It will describe the emerging reality that a handful of BigLaw firms are in a very different business than the rest. This means something more and different than I described and laid out in A New Taxonomy. Its repercussions, I believe, will be profound and will play out over the remainder of many careers.
