Amazing Firms Amazing Practices : Gerry Riskin : Edge International

My Edge International partner, Jordan Furlong, has done a nice welcome piece on Pam Woldow already (at his Law 21 blog) but I thought I would echo that Edge International is so very proud and delighted to have her on board.

Also, thank you to friends who have joined us in congratulating Pam, like Valorem's awesome founder, Pat Lamb, who expressed delight in his In Search or Perfect Client Service blog post.

Those of you who know Edge International well can be assured that we are intent on growing in strength and capabilities.

Please make sure you follow Pam's new Blog, At The Intersection, for her continuing wisdom and counsel. 

Stay tuned.

 

 

 

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I met virtually with Recorded Future this morning for a close up briefing of how their Temporal Analytics Engine might be used by law firms.  Firms who use this can better predict the needs of their own clients and prospective clients as well.   There is so much more that this technology can do if used effectively, including monitoring the industries that a firm serves now and perhaps should serve in the future.

How often does a potentially powerful competitive weapon come along for the legal profession… and, more importantly, will law firms recognize it when they see it?

 

 

 

 

 

 

 

 

 

 

 

Recorded Future, the world's first Temporal Analytics Engine, is a new predictive analysis tool that allows you to visualize the future, past or present.

Start by reading their blog post today Law Firms and Recorded Future.  Then sample their video explanation on their home page. 

My Prediction:  Very few law firms will do an exemplary job of exploring this technology.  Those who do will likely meet considerable resistance internally from those who are slow to trust technology and especially revolutionary technology.  I am completely OK with that. 

What excites me: is that a few law firms that see the true potential of this technology and will use it in imaginative ways.  At Edge International, our core business is helping clients who are committed to achieving competitive advantage.  You can bet we will be exploring this with our clients, and maybe some prospective ones as well.

 

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Top 10 recipients of associates' seal of approval:

1.    Ropes & Gray
2.    Williams & Connolly
3.    Morrison & Foerster       
4.    Fitzpatrick
5.    Shook, Hardy & Bacon
6.    Hughes Hubbard & Reed          
7.    Jones Day
8.    Davis Polk
9.    Paul, Weiss
10.  Skadden, Arps

View the entire 2011 Vault Law Firm Quality of Life Rankings.

ROPES & GRAY REPEATS AS BEST LAW FIRM TO WORK FOR; LAW ASSOCIATES AT WILLIAMS & CONNOLLY MOST SATISFIED

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Speaking of bold, CMS Cameron McKenna has a pricing team!  (See page 14 of their brochure, The future of fees: your route map to value.)

Punchline:  CMS Cameron McKenna has 122 Equity Partners and employs over 1,000 fee earners in 10 offices.  They are big enough and influential enough to be a tipping point in their own right.  Those other law firms who ignore Alternative Fees and Value Pricing because "they just won't ever take hold" are in grave danger of playing catch up or even missing the boat altogether.  You don't need your own pricing team today but what you do need is a team within the partnership to start exploring how your firm will enter this game and when (not if).

Thank you to Gavriel Hollander at The Lawyer for the original story

 

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Greg George, Managing Partner of top security firm GTI Advisors Threat Management Practice Group has created a comprehensive due diligence report — among his many recommendations, he suggests that businesses consult a law firm  - is your law firm ready to answer that call?  SECURITY may be a lucrative future-oriented practice area awaiting your firm.

I recommend:

1)  Check out GTI Advisors Threat Management Practice Group

2)  Download (free) and read Beyond Due Diligence

3) Note the section "Qualified Legal Counsel Is Worth Every Penny" on page 18.

4) Discuss this in your firm and explore an appropriate strategy before you are left in the dust by forward thinking firms that will.

Footnote: Determine if you are the cobbler with no shoes (when it comes to security) — perhaps your law firm could use a few of the amazing ideas in this document as well.

Note:  For international clients, this piece is clearly written for American audiences but I believe the vast majority of the content will be useful regardless of your location.

 

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Appreciation is not assumed — it has to be communicated…  if you think your clients know you appreciate them, ask your self "how would they"…  Make it explicit and you'll separate yourself from the masses !

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I’ve witnessed first- hand increases per participant ranging from hundreds of thousands of dollars to millions of dollars.

Download this article (or read on line) with my compliments. (Click on image)

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We are very proud of our latest Edge International Review.    For a complete downloadable version (or just the articles you want) click on the cover or go to EdgeInternationalReview.com

If you have any questions , comments or suggestions, please shoot me a note.

(You can also check out our Edge International web site at Edge-International.com)

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If your firm has offices in the Great Lakes Region (or is thinking of expanding into it) there is an unprecedented and unmatched comprehensive analysis available: “2010 Legal Market Analysis Great Lakes Region”

The report contains:

• 115 pages of detailed factual competitive intelligence
• 126 charts, graphs and illustrations
• 8 States and 10 Metropolitan Areas
• Information on 215 law offices

Cities included:

• Chicago
• Milwaukee
• Detroit
• Indianapolis
• Cincinnati
• Minneapolis
• Columbus
• Buffalo
• Cleveland
• Pittsburgh

I think this is a fantastic deal.  If your firm tried to pull this together on your own, you’d spent months and tens of thousands worth of time doing your due diligence which would include analyzing the firms, clients and economics of the region.  I expected the price would be around $7,500 but it offered at $2,995

I was also impressed by the Guarantee of Satisfaction - if your firm is disappointed (you won't be) you can pull the trigger on the guarantee.

For many leaders, the most important and imponderable question relates to the timing of the recovery — one of the elements of this report is

• “Prognosis for timing and extent of legal market economic recovery”

My enthusiasm for The “2010 Legal Market Analysis Great Lakes Region” is based on these simple premises:

1. The team that created it has many decades of law firm experience
2. The sources of data are impeccable
3. Ed Wesemann (architect of this publication) is a truly gifted analyst and law specialist

The downloadable prospectus including full Table of Contents will give you an idea as to how well organized this work is.

At the very least, this analysis is an important reality check.  Many firms have skewed views of their own markets based on prejudices or outdated data that tends to stick in the minds of firm leaders.

Here is an excerpt from the free  downloadable prospectus showing the nature of the contents of the report:

A detailed competitive analysis for each city providing:

• Comparative reputation within the specific legal market
• Detailed descriptions of competitive situations
• 2010 depth counts of lawyers in the local office and firm-wide

An accurate and up-to-date economic analysis of each metro area including:

• Projections of the growth of key drivers that affect the legal market
• Prognosis for timing and extent of legal market economic recovery
• 2010 Assessment of stability of leading industries and top employers

Assessment of demographic, businesses and market data for each state and metro area including:

• Size of legal markets
• Business friendliness, job growth, cost of doing business and other important indicators
• Strength, Weakness, Opportunity and Threat (SWOT) Analysis for large firm legal practice in each metro area

Download the prospectus and see for yourself.

Note:  I know the people behind this initiative very well but want to make it clear that I have absolutely no financial interest in their venture — I am posting this based on receiving a review copy. I believe this is an extraordinary offering and far more valuable than its price would reflect.




    

   
 

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Nearly three decades ago, in the early days of Edge International, there was only one writer in the area of managing a professional firm that commanded our unqualified respect and attention. That was David Maister.

“Managing the Professional Services Firm” is the Bible, according to many leaders of some of the largest professional service firms in the world. “True Professionals” spoke to the firms for whom dignity and quality service were the engines of success. And he wrote so much more in collaborations and articles.

In Edge, we were lucky enough to find ourselves presenting at a few conferences in common with David, in various places around the world and one day ended up having a very private informal retreat. This led to the creation of PracticeCoach®, an extraordinarily comprehensive video-based resource to help law firm leaders around the world. It stars David.  What a joy it was to create with him.

His philosophy was so in harmony with ours.  For example, we loved his guarantee of satisfaction (and were proud that we offered one as well even before we knew he did).

There were some very cool things I learned from David:

• David loves his wife, Kathy, with such passion and always treats her as his trusted advisor and coach. (She's the Guru's Guru.) With Kathy, David taught my wife, Bethany, and me how to travel for weeks internationally without checking luggage. “IMPOSSIBLE!” we said standing on the curb in front of their place one morning with four huge suitcases’s while David and Kathy had their little rollers behind them. “You just need to learn how to pack properly…” they replied, and during our next visit we got the tutorial. (Actually, David and Kathy, if you wrote a book based on that tutorial….) Bethany and I owe David and Kathy the moon for that advice.

• David exemplifies passion. He loves his wife and his music collection which is of a magnitude that makes it the 8th wonder of the world…and he’ll sing till dawn. :-)

• David has energized audience after audience…forcing thought about important issues and even more importantly, sometimes with the help of voting machines, making them actually decide on things.

I am not surprised by the awards and accolades* he has received… just delighted.

The good news is that this is not a eulogy (even if it sounds like one). David and Kathy’s infectious smiles will remain available to us for many many happy years to come.

If there is a sad note in this homage, it is that David's retirement represents a loss to my beloved legal profession and all the other professions he served so well.  However, his books and programs live on. As I write this, I am helping a prominent South American firm to use the study in his book, “Practice What You Preach,” to help them analyze and choose the most fruitful areas of focus for their continued improvement.

Maybe David’s and Kathy's retirements will be like some famous souls who preceded them who were coaxed back into the game for an important gig or two.

By the way, Kathy retired from one of the most incredible video enhanced blogs in history: startcooking.com where you can still experience valuable lessons - check it out !  This is not an amateur undertaking - you will find broadcast-quality production values.

David and Kathy, Bethany and I treasure you and I know if we gathered those of like mind we’d need a mighty big arena.

Retire in good health!! Well earned - BRAVO!

 

*awards and accolades

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Take a few moments at the beginning of your next (executive, practice group, industry group, client team) meeting and watch this piece from Australia's George and Margaret Beaton (Beaton research and Consulting).  They have been friends for a long time and not only built an amazing high end consultancy but have done it with panache and imagination.  You will see some data that will act as a catalyst for the thinking of your leadership team.

Enjoy:  The Big (Legal) Picture video

Punchline:  The legal Profession absolutely refuses to stay the same so don't let your partners treat it like it will.

Pat Lamb's added this commentary at his awesome Blog,  In Search of Perfect Client Service:   You'll like irrelevance even less

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Patrick Lamb is synonymous with Valorem Law Group which is a driving force in changing how legal services are valued and acquired. After learning that Jordan Furlong was joining us, here's (an excerpt from) what he posted:

It's like adding Wayne Gretzky in his prime to the team that already was the best team in the league, or adding an all-star to a team of all-stars.  Great move, my friends.

Read the complete post here: WOW! Jordan Furlong joins Edge International!

If you lead a law firm and do not yet subscribe to Patrick's blog, In Search of Perfect Client Service, then go now and take care of that oversight.

If you want to learn more about Patrick, choose one if his bios:

In his own words

Pat's formal (boring) bio

Now as for Jordan Furlong, Jordan thanks again for joining us,  You are more like Gretzky than even Patrick may know.

I was practicing law in Edmonton during the Oiler dynasty and saw Gretzky informally as well as on the ice.   He was a young man of values and integrity… a great contributor to the community… and always selfless… ego-less… always doing his best… and his best, we all know in hindsight, was truly awesome. 

Having known Jordan Furlong personally and professionaly for many years, I can attest to the attributes that Patrick Lamb affords him and add that he is the kind of dream teammate we so much appreciate at Edge International.  In fact Jordan inhales and exhales integrity - it's the core of his DNA.  (Heck - he even comes from Ontario, Canada and brings endorsements - thanks to Patrick).

Jordan, (blame this on Patrick Lamb), I now pronounce your Edge International nickname to be "Gretz" from this day forward.   Welcome aboard, Gretz !

 

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It is a proud day for all of us at Edge to add such a distinguished partner.  After law school, Jordan articled with one of Canada's leading law firms and then opted for a career in legal journalism culminating with more than 10 years as editor-in-chief of the Canadian Bar Associations distinguished well respected National magazine and executive editor of CCCA Magazine

Now Jordan joins us to offer both strategic and tactical advice to lawyers, law firms and legal organizations, centered around his very clear vision of a legal service marketplace undergoing massive and irreversible change.

Among his other accomplishments, Jordan is an award-winning blogger.  He has been writing since January 2008 at Law21: Dispatches From a Legal Profession on the Brink, where he chronicles the extraordinary changes underway in the legal profession. He is an Honourary Fellow of the College of Law Practice Management and Chair of the College's InnovAction Awards, which recognize and reward creativity and innovation in legal services delivery.

Welcome aboard Jordan !  (See his biography on our Edge International site)

 

 

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Evan R. Chesler is a Presiding Partner at Cravath, Swaine & Moore LLP.  He has offered his thoughts via Forbes in a piece called: Kill The Billable Hour.  There is no suggestion that he is articulating a new policy for the entire firm but he is clear on his own views and given that he is the presiding partner, his words may very well represent some strategic thinking within the firm.  

Here are some excerpts from Evan R. Chesler's views:

"I bill by the hour... This needs to be fixed. Yes, you read that correctly."

"Clients have long hated the billable hour, and I understand why."

"So what am I proposing? For reasonable periods of time during the life of a lawsuit, say three months at a time, I should... identify the client's objectives, measure, calculate, build in a contingency and come back with a price. Once the price has been agreed upon, the billable hour should be irrelevant.

PUNCHLINE:   Evan R. Chesler is not the first lawyer to understand this.  Visit the firm founded by awesome litigator Patrick Lamb and you'll see he and his partners have been living without the billable hour for some time at Valorem.  Are Evan Chesler and Patrick Lamb (and those few who think like them) right?  My money is on YES - the proof will be how sophisticated clients vote with their choice of counsel.

Patrick Lamb

Photograph of Evan Chesler by Fred Marcus Photography as it appeared in the referenced Forbes article.  Image of Patrick Lamb (with hammer and clock) from the Valorem firm's website.

Read the entire Evan Chesler story here: Kill The Billable Hour and visit Valorem here and Cravath, Swaine & Moore LLP here.

Hat tip to Larry Bodine's ListServ for alerting me to the story.

 

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The image above is the core of the post of internet phenom, Rajesh Setty, in his post today at Life Beyond Code: Optimists and Pessimists - The big difference is..

Couple that with the wisdom of lawyer and legal profession provocateur, Patrick Lamb, in his post today: Silver Lining in Black Economic Cloud? in which Pat says among other things:

If you don't see the opportunity to restructure relationships in ways that produce savings for your clients while at the same time strengthening your relationship with that client, you need to open your eyes.

Punchline:  My asking Managing Partners to treat the deterioration of the economy seriously is in perfect harmony with seeing the situation as a competitive opportunity.  My view of Dynamic Resilience as an alternative to a traditional strategic plan is just that - exploiting the opportunity to be stronger than competitors in challenging times.  (Remember the hiking joke when one hiker says to the other “I don’t have to run faster than the bear; I only have to run faster than you”).

I invite you again to push the button.

 

 

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Managing Partners, you may have a disaster plan for fire, perhaps for terrorism - do you have one for the economic train coming off the tracks?

Listen (and watch) what Greenspan said yesterday Sept 14th (50 seconds)

Punchline:  You are getting fair warning - are you acting on it?  This is not a time for traditional strategic planning - it is time for scenario planning that will create "dynamic resilience" that may become the life support system your firm will need should the economy worsen. 

It's time, as Nike would say, to "Just Do It".  

Push the button. (click it) then let's talk about this privately.

 

 

 

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Britain is facing "arguably the worst" economic downturn in 60 years which will be "more profound and long-lasting" than people had expected, Alistair Darling, the chancellor, tells the Guardian today in a story called: Economy at 60-year low, says Darling. And it will get worse

Wall Street returns from vacation season to enter what is historically the most perilous period of the year amid conflicting signals about the US economic outlook according to Breitbart in a story called: Wall Street enters month of peril with outlook clouded

In the face of these stories, I am disappointed to report that this is the most common management style I am observing among law firm leaders globally:

If this resembles you, give me a call or email me and we can discuss this off the meter.  Managing Partners and members of their immediate senior teams only please.  (You might be even more inclined to call if this does not resemble you.)

Reference my post one year ago: Doom and Gloom for the legal profession - it's coming

and Weather the Storm Article Available from Canadian Bar Association's The National

 

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Law Professor William D. Henderson (click on photo for bio)

Managing Partners and law firm H.R. Executives should contemplate the meaning of Indiana University School of Law's Prof. Bill Henderson's post: "How the 'Cravath System' Created the Bi-Modal Distribution."

Professor Henderson builds on the work of NALP (The National Association for Law Placement®, founded in 1971) who published this graph in 2007 referencing 2006 salaries their article called "A Picture Worth 1,000 Words":
 


Note how meaningless the Median is in helping any form set associate salaries.

Professor Henderson asks, among other things: "Are We Selling Results or Résumés?" which is the title of one of his papers in this area.  Here is a related excerpt:

"The Results or Résumés paper draws upon two pieces of market data to demonstrate that a large proportion of large corporate law firms have to re-evaluate their business models:  (1) stunning uniformity of associate entry level salaries amidst large, growing disparities in profits per partner; and (2) evidence that firms are becoming stratified by premium versus non-premium practice areas."

Professor Henderson also draws our attention to the unbelievable burden taken on by firms that are not the most profitable by showing a comparison between associate salaries and per partner profits as you move up the profitability curve:

Professor Henderson then explores the lateral partner mobility within the Am Law 2000 and in his words "teases out a relative hierarchy of practice areas"  According to Professor Henderson, the table below, which covers the 2000 to 2005 time period, orders legal specialty by differential profits per equity partner (PPP) between the firm a partner left and the firm he or she joined.

I strongly recommend that you read Professor Henderson's entire post but I think the best is yet to come as evidenced by the final paragraph in his post:

"Fortunately, the Results or Résumés paper lays out a solution for any law firm willing to try something new.  The psychological barriers, however, are much larger than the logistical or financial.  I will blog on this topic in a subsequent post."

Thank you also to my friend Bruce MacEwen of Adam Smith, Esq. for his excellent post on this topic: THE BI-MODAL STARTING SALARY DISTRIBUTION and the ABA post: ‘Cravath Model’ that Created Have and Have-Not Law Grads Could Implode

PUNCHLINE:  The legal profession resists change for good reasons and bad.  As always, it won't be the legal profession initiating the change - our clients will do that for us.  The fundamental question is whether your firm will be among those to first respond to these issues and from that gain well-deserved competitive advantage.  Stay tuned.

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The Services Safari Blog posted this yesterday:

Calling all Lawyers... The Bear Stearns Collapse

The following is an excerpt:

Shareholder litigants are going to be talking about this one tonight and tomorrow. Let's recap the fall of Bear Stearns stock price and market value the last year:

Stock price last year: $159/share - market cap: $18.76 billion
Stock price last week: $69.75/share - market cap: $8.23 billion
Stock price Friday: $30/share - market cap: $4.04 billion
Acquisition price Sunday: $2/share - market cap: $236 million

The post ends with:

Are criminal indictments in the future?

Punchline:  this trumps my wildest speculation about how erratic the economy may become.  Managing Partners:  Are the appropriate practice group and industry teams watching all economic indicators (formal and informal) and reporting to you frequently (a la #4 in my January 24 post: Recession-Proof your Law Firm).

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Is your “winning streak” about to become a “losing streak”?  I believe it is likely unless you prepare for the test you didn’t ask for but are about to take.  Let's be honest, most law firms have had a pretty good run and your partners are well accustomed to it.  Will your partners understand what a decrease is? Will your firm maintain the winning attitude that brought you this far?  If you don’t think the next few miles of road are bumpier than you're used to then the following may be of little interest (except perhaps for the reference to “denying the facts”).



I Irecommend that you visit (or revisit) Confidence - How Winning Streaks and Losing Streaks Begin and End by Harvard’s Rosabeth Moss Kanter. 





Rosabeth Moss Kanter's biography for those interested

Confidence is a road map that helps you react more constructively than you might otherwise have to the challenges you will face (like this deteriorating economy).  The losing streak is fraught with a disease whose symptoms will infect your people - they include::

• Stop communicating
• Criticize and blame
• Disrespect others
• Become isolated
• Focus inward
• Let inequalities develop and persist
• Lose initiative
• Forget goals and aspirations
• Spread negativity
• Deny Facts

Your job as a Managing Partner (or as a member of the senior management team) is to understand and live Kanter's three cornerstones  of confidence:

• Accountability
• Collaboration
• Initiative

Most Managing Partners don’t read business books (don’t be insulted – you don’t have time and our studies so indicate).  So may I suggest you subscribe to one of the two excellent services that I subscibe tothat  summarize or abstract many good books for you in a short 10 to 20 minute read. Often they also provide an audible version for your iPod also from 10 to 20 minutes in length.

Check out Soundview Summaries and getAbstract.  If there are others, let me know.

PUNCHLINE:  Put Rosabeth Moss Kanter on your informal advisory team by buying the book or subscribing to one of the summary services above.  You cannot prevent the legal profession from having a losing streak here – but you can prevent your firm from having one.

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The worst market crisis in 60 years: "recession or worse"?  Says who? The 80th richest man in the world, George Soros, (estimated net worth of 8.5 Billion according to Forbes).  Is Mr. Soros toying with the "D" word: "Depression" when he says "recession or worse"?

I recommend that you read the entire Financial Times (FT) article dated January 22, 2008: The worst market crisis in 60 years.

This is not a new subject for me - see my August 3, 2007 post Doom and Gloom for the legal profession - it's coming with respect to which Valorem Law founder, Patrick Lamb, kindly called me "an awfully good soothsayer" in his January 19, 2008 post Will The Perfect Storm Fundamentally Alter The Foundation Of The Profession?

Citibank’s Law Group Head and friend, Dan DiPietro, seems to be singing in harmony with Mr. Soros.  Dan believes that US law firms may soon be battling unprecedented economic pressures.

As a law firm leader,  you need to ask yourself some hard questions.  My Edge International partner, Rob Millard, and I believe you need to: Recession-Proof your Law Firm and that Law firms must immediately prepare by reassessing their strategies in order to:

• minimize the potentially firm-threatening impact and
• capitalize on competitive opportunities

Managing Partners should consider these SEVEN KEY STRATEGIC FACTORS in order to “recession-proof” the firm:

1. Strong Leadership ??  In ancient times, the Cherokee Nation had one chief who would rule during times of peace; another during war. The need for hard, courageous decisions, even sacrifice, is common to both recessions and wars. In both, strong leadership is critical if hard decisions are to be taken and actually executed.
2. Ramp Up the Frequency of Financial Data Reporting   ??Things can change fast in a recession. Clients, under financial pressure themselves, terminate engagements. Revenues may contract. Debtor payment periods and write offs may deteriorate, putting pressure on liquidity. The firm’s key financial metrics must be monitored far more frequently than in boom times.
3. Make the Hard Decisions Humanely and Fast  ??Layoffs, if required, must be quick and humane not only to preserve capital, but also to get the firm past this trauma quickly and focused on working forward again. Continued employment of underperformers must be carefully assessed. Where the market is no longer buying specific services there are two choices: retool (quickly) or separate. (Do not misinterpret this as a suggestion to rush to lay off people though. Long-term considerations suggest this is a last resort option for all personnel except those who ought to have been asked to leave years ago.)
4. Get Practice Leaders and Client Team Leaders focused on short-term action plans  ??Actions must be executed more quickly than in “good times” and therefore designed for rapid implementation. Plans must be focused, systematic and disciplined. Those that will actually drive plans must be integrally involved in crafting them and managing their execution. Feedback and accountability measures are critical to ensure that the plans are executed, especially when they relate to the hard, courageous decisions (point 1.) Non-billable time becomes a valuable asset and must be actively managed to ensure that key tasks receive priority.
5. Involve Your Clients  ??In recessions, client mobility increases. Client needs evolve more quickly as new threats and opportunities emerge. Firms need to go beyond simply expressing empathy and assuring continuing loyalty. They need to actively position themselves to meet emerging key client needs. This cannot be done without actively discussing business (not just legal) issues with clients. If you don’t have client teams in place for your key clients, now would be a good time to start!
6. Manage Internal Expectations   Business as Usual Could Be Lethal??Remember the tale of the two frogs? The first is dropped into a bowl of hot water. It jumps out. The second is dropped into a bowl of cold water and slowly heated up. It doesn’t jump out and eventually dies. Similar procrastination has been the death of too many good firms. You need to explain internally what is being done to weather the recession and the likely impact on the financial positions of your people. This knowledge will motivate your people to do what is expected of them rather than default to “business as usual.”
7. This Too Shall Pass   Keep a Balance With Your Long Term Strategy??Think strategically about whether and where to cut short-term resources. Retaining some temporarily unprofitable practice areas and individuals may be advisable if they are important to your long-term goals. On the other hand, a recession is an excellent time to re-engineer or sever areas that have become less profitable but have been tolerated to avoid conflict.

The Chinese character for “crisis” consists of two symbols. One means “danger,” the other “opportunity.” While strategy may be more challenging during recessions, if you grasp the nettle, opportunities will arise to enhance your client mix and your talent base.

Thanks again to Robert Millard for his collaboration on this. 

As always I appreciate your feedback.

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Gary Wingens of Lowenstein Sandler and Frank Burch of DLA Piper listen to Dan DiPietro of Citibank forecasting a tough 2008 at the Army and Navy Club in Washington DC during The Edge International Managing Partners Strategy Summit

Last week, my Edge International partner Robert Millard and I hosted a very private, personal, invitation only, Strategy Summit for the Managing Partners of 10 law firms to explore:

•    key strategic issues facing law firms today

•    what law firms are doing to address these issues

•    what constitutes "best practice" in the law firm strategy process

The managing partners represented firms ranging from the largest in the world (DLA Piper) to a tiny, brand new firm with a highly innovative business model (Valorem Law Group.) It was a truly fascinating two days of strategic debate and solution building.

On the facilitation / faculty side, we were joined by guests Dan DiPietro of Citibank’s Law group and Michael Rynowecer, President of BTI Consulting Group of Boston. The venue was one of the most prestigious and historic venues in Washington DC: The Army and Navy Club, barely a block from the White House.

We are currently preparing to communicate learnings from the Summit in a special publication in February. Not everything will be covered. The summit included many candid exchanges between the managing partners, sometimes on quite sensitive issues. Arguably, this was by far the most valuable part of the summit. We have agreed that the Managing Partners themselves will be the final arbiters on what gets published and what does not.

Thank you very much to the managing partners that participated. In alphabetical order, they were:

Charles P. (Chuck) Adams, Jr., Managing Partner, Adams & Reese
Francis (Frank) Burch Jr., Joint Global Chief Executive Officer, DLA Piper
Nicolás Herrera, Managing Partner "Guyer & Regules" (Montevideo, Uruguay)
R. Steven Kestner, Executive Partner, Baker & Hostetler
Patrick Lamb, Chairman, Valorem Law Group
Don G. Lents, Chairman, Bryan Cave
Christopher Marston, Chief Executive Office, "Exemplar Law Partners"
Keith Vaughan, Managing Partner, Womble Carlyle Sandridge & Rice
Mark D. Wasserman, Managing Partner, Sutherland Asbill & Brennan (substituted for by Executive Partner Tom Gick on Day 2)
Gary M. Wingens Managing Partner Nominee, Lowenstein Sandler

Each invitation was extended based upon personal peer recommendation.  The event was not publicized beforehand.  Many of those invited reluctantly declined because of conflicts with their internal firm events, often related to compensation given the time of year.

Given the very positive feedback from the participating Managing Partners, we will certainly host similar events in the future.  If you are interested in being invited and are willing to recommend other firm leaders with whom you would like to explore timely issues, please let me or my Edge partner Rob Millard know.

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...you would have seen my Edge International colleague and friend, Robert Millard, present the findings from the latest Managing Partner Forum Survey related to differences in approach to strategy in firms in the United Kingdom vs North America, and also in CPA (Accounting) Firms vs Law Firms.  (Click on the sample slide to enlarge)

Download your own copy from Robert Millard’s Blog, Adventures in Strategy, post: Slides from Managing Partners' Forum meeting at White & Case LLP, New York on Thursday, 18 October 2007

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In Three myths about legal services offshoring (The Hindu) there is some very very sobering information especially for those who hope that it means offshoring will just fade away sooner or later.

If you intend to practice law for 10 or more years then:   READ THE ARTICLE

Here are some teasers/excerpts:

"Attacks on the competence of Indian lawyers and law graduates are about as valid as saying that Indian software engineers are incapable of handling sophisticated IT (information technology) work. To the contrary, the Indian IT industry is a world leader, and the same will be the case with offshored legal services."

"A recent study conducted by Harvard Law School and LexisNexis reveals that 75 per cent of US law graduates admit they do not have the necessary skills to practise law."

"So you would expect that these deficiencies would be met by rigorous training programs undertaken by Western law firms. Guess again! The Harvard-LexisNexis study reveals that 64 per cent of young lawyers receive no organised, on-the-job training."

"By contrast, reputable legal services offshoring companies in India provide rigorous training to their lawyers, and the hours spent on training do not appear on invoices to clients."  

"…at least in the US, law graduates for the most part are notoriously incapable of writing effectively in English. The problem is so severe that some large US law firms now assign a writing coach to each incoming associate. However, most lawyers in the West never receive this kind of training. By contrast, reputable legal services offshoring companies in India train all their attorneys in English writing."

"The future of the legal services offshoring industry in India appears very bright."

"Corporations, not Western law firms, will drive the market in the years ahead."

"Another way that corporations will drive the market, indirectly, is by obtaining flat (or fixed) rate billing from their outside counsel, instead of hourly billing. For example, the mega law firm, Morgan Lewis & Bockius, now handles all of the litigation for Cisco Systems for a fixed annual fee."

"Every sector of the legal offshoring industry will grow dramatically, including lower end services, such as document coding and legal transcription. Ultimately, however, the biggest impact, the long-term mother lode, will be higher-value services such as legal research and drafting – services that constitute the bulk of the legal work now done in the West."

"Long-term, India’s enormous, mostly untapped population of over one billion citizens will continue to make India competitive in relation to other offshore destinations… ultimately it will not only decrease poverty, but increase the number of law graduates."

"On the most positive note, the growth and development of the legal offshoring industry in India will help bring about a major change in the way legal services are delivered in the West."

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At Edge International we are often asked about how lawyers and their firms might be different from place to place around the world.    One of my stock answers is that many people misinterpret the propensity of the Brits to avoid hyperbole to mean that they are not aggressive.  There is a reason why they once ruled the world and their legal profession seems to be bent on repeating the feat.

According to a post today at LAWFUEL, "Lovells, the law firm, is to launch an alliance with nine Chinese counterparts, in the latest sign of the English legal profession’s aggressive efforts to export its services to big economies where foreign lawyers are restricted."  (Note, not one or two or three, but NINE!

As well, "China is one of a number of leading emerging economies being lobbied by the British government and legal industry representatives to scrap restrictions on foreign lawyers."



PUNCHLINE:  The Brits have never stopped thinking globally - many Americans have not started.  (There are notable exceptions of course but if I were placing a bet on world domination, my gold coin goes on the British square.)  Your thoughts?

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       Mike Dillon

Would you listen to the General Counsel of Sun Microsystems, if he said:

“I do believe that there may be times when a $1,000/hour fee is warranted”

“…just yesterday, I read of another example of how law firms continue to be primarily focused on maintaining profits through consolidation and growth of headcount. As a GC, what I'd rather see is an article about how law firms are creating new business models that reflect the reality of my organization - providing consistently high quality of service with a constant focus on efficiency.”

“As recently as four years ago, we had several hundred (that's always embarrassing for me to say) law firms that we used for general purpose legal work in the United States. Since then, we have been aggressively reducing this number to the point that this year we announced that we are moving to nine "Preferred Partner" firms.”

“…we are already seeing examples where … firms are proposing creative pricing models and investing in better understanding our business.”

“…we needed to have about 10,000 agreements reviewed and summarized for an on-line database. We send out an RFP to a large number of firms and through this process filtered the number of candidates down to a handful. These were then invited to participate in an on-line competition for the work. During the course of the event, it was fascinating to see firms from around the world compete to win the business. (If you've ever sold anything on eBay, you know the feeling.)”

“…we quietly started a small team several years ago called "GLN" (Global Legal Services). They are focused on efficiently handling the less complex, but higher volume agreements and services we provide.”

The above quotes are from a single blog post called: Context is everything by Mike Dillon
Senior Vice President, General Counsel and Corporate Secretary, Sun Legal Department of
Sun Microsystems, Inc.: .

PUNCHLINE:  Managing Partners – do you dare not read his future blog posts?

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Many of my friends and clients know me as a very optimistic person so this post may surprise them.  I feel like I am about to watch the next dot com crash only I am not talking about the internet or high tech.

I have held this belief for many months and I believe that the economic indicators that can hurt the legal profession are gaining momentum.  How much longer can the legal profession remain insulated from the market realities?  I say not long at all.

Our legal profession is in for very rough times. My message to Managing Partners is not to become pessimistic but simply to have a contingency plan in place.

Most firms will:

a) continue to be hourly billers (for the most part)
b) plan for extensions of the historic linear revenue and profit per partner growth
c) perhaps fine tune by de-equitizing or closing an unprofitable office or two

but few will create a contingency plan for:

a) dramatic drops in demand for many traditionally hot practice areas
b) over-staffing (at all levels and in most practice areas)
c) the cancer of internally competitive behavior as the pie shrinks

Those inclined to tell me I am crazy I ask to wait six months following the next US election – then I will eat this post if I was wrong.

I love our profession and want only the best for it so I hope the smart Managing Partners out there will prove that great firms can thrive through adversity – especially when your competitors are not capable of doing so.

My heart hopes I am wrong – but my mind tells me otherwise.  I decided that down the road it would be no good to say “I knew it” if I lacked the courage to post it now.

Your comments are most welcome, as always.

Addendum:

Patrick Lamb posted the following comment both here and on his own popular blog: In Search of Perfect Client Service in his post: Gerry Riskin's Forecast: Stormy Times Ahead.

I think he deserves a response:

Patrick’s comment/question:    Gerry--very powerful post.  Not one that I disagree with at all, but can you share with us the signs you see that lead you to this conclusion?  And are the elections tied to result or simply a benchmark for the time by which you think the changes will be apparent?  Ciao.

My response:  The US election is a process that sees powerful interest groups exercising their discretion in a manner which will increase the probability of their preferred candidate(s) being elected.  As a result, a temporary and indeed unsustainable economic climate may be manifested.   I think things get very real about six months after US presidential elections.  With outcomes certain, interest groups lose their motivation in a hurry – at least for a while.   As for the indicators themselves, I am afraid to start because where do I finish?  However, here are some things to examine:

    Currency fluctuations
    Price of oil
    Price of precious metals
    Increase and decrease in “real” jobs
    Geographic location of those jobs
    Political stability of job locations
    Foreign relations as they affect business
    Balance of Trade between countries and regions
    Housing markets (not just prices – but demand)
    Auto market (demand)
    Credit levels (or should I say “debt levels”)
    Interest rates (they are not falling, in fact, get ready…)
    The advent of the largely unregulated Hedge Fund industry
    The establishment pensions that invest in Hedge Funds
    The Domino effect – how one indicator impacts many others

And specific to the legal profession:
   
    The disparity between views of General Counsel and Outside Law Firms
    Associate starting salaries (and consequential impact on all salaries)
    “De-equitization of partners” trend
    “Law firms going public” (anticipated) trend
    The obsession by partners on remuneration
    The expectation of continued increasing revenues, PPP and PPL
    The surrealism of the financial expectations of new lawyers
    Comments from Citigroup’s law firm market specialists

Disclaimer:  Yes, I obtained a business degree before law and yes I studied economics and yes I subscribe to reliable publications like The Economist but I do not profess to be able to predict the stock market or future currency fluctuations.  In fact, I will admit that my post is based to a large extent on a hunch – intuition (I read Blink by Malcolm Gladwell so maybe this is OK).

Punchline:  If there were a fund that invested in the legal profession worldwide (at least in the western world) I am not a buyer – I might even summon the courage to put some money at risk by “selling short”.

In closing, perhaps not you, Patrick but there are many who will think I am completely wrong – I not only respect their right to hold that view, I hope that their view prevails.  I post this because if there I seven a significant possibility I am right, as stated in my original post:  “My message to Managing Partners is not to become pessimistic but simply to have a contingency plan in place.”

Addendum #2:  In light of the stock market tumble today, I thought I should clarify that this post was not a reaction to it but rather done before today and scheduled to auto post after midnight this AM - here is an image from my aggregator to verify:

-30-

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Ahhhh yes… seduction! 

Many great firms that I serve have a common enemy ”complacency” which Is indeed the result of decades of success.  Managing Partners complain that they are unable to get their partners to pay attention to their future.

Read Jim Hassett’s blogpost, Have lawyers been seduced by success? In his fantastic blog: Legal Business Development.

Here’s a teaser quote: 

If you like money, it's a great time to be a lawyer. In Citigroup's Law Watch survey of "153 US law firms broadly representative of the industry," law firm revenue has gone up 9.8% per year since 2001. But as Bill Gates put it: "Success is a lousy teacher. It seduces smart people into thinking they can't lose." We know lawyers are smart people. Do some think they can't lose?

Read why Jim argues that you ought to read:

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Harsh?  If killing the golden goose is stupid, then this is not harsh at all. 

Find out why 58% of (surveyed) General Counsel expressed outrage.  Find out why 84% of (surveyed) General Counsel wanted the law firms they use to contact them about associate salaries but none did.

Brilliant law firm leaders who can not empathize with the clients they serve (including General Counsel in their larger clients) are going to pay an enormous price.

If sustaining profitability is high on your agenda, read Patrick Lamb’s post called “Demand Destruction” in his famous In Search of Client Service" blog.  (In a better world, there would have been no need for this post.)

Punchline:  Within the next two years, many private practice law firms will be going through some rough times and many will blame the GC’s of their clients.  There are two sides to this story.  Some bold firms should gather the courage to communicate with their clients directly and with candor.  The best texts on negotiating describe win/win scenarios where both sides benefit.  There is a certain immaturity to the ostrich approach most law firms take to these issues – even major firms.

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The Wall Street Journal posts: Slater & Gordon: The World’s First Publicly Traded Law Firm

Managing Partners and other members of law firm C suites had better look at Slater & Gordon’s prospectus – it’s a gold mine, (pun intended).

Have a look at how risks are described – the Wall Street Journal post quotes the passage balancing professional responsibility and shareholder profits.

"Lawyers have a primary duty to the courts and a secondary duty to their clients. These duties are paramount given the nature of the Company’s business as an Incorporated Legal Practice. There could be circumstances in which the lawyers of Slater & Gordon are required to act in accordance with these duties and contrary to other corporate responsibilities and against the interests of Shareholders or the short-term profitability of the Company."

I adored the "Key Risks" page (click on it to download pdf of this page):



PUNCHLINE:  If this does not fascinate you, you should resign from your leadership position.  I am not saying you should follow suit – I want you to know what your options are and what your competitors might be up to way sooner than you would like to think.

Science fiction movies adore time travel and ripples in the primordial fabric.  We are witnessing a collision - the future has just exploded into the present.  With Clemente in the UK just over the horizon, please fasten your seatbelts - this is a pivotal moment for the legal profession and for the Managing Partners within it.  Like Dennis Hopper's famous line in the movie Speed, "what are you going to do, Jack"

You may want to reference my earlier post:  The end of the legal profession as you knew it...

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The Wall Street Journal speaks - shall we listen?

“[William Durbin Jr.] regrets having focused too much on profits and “de-equitizing” partners (reducing their stake in the profit pool) in an effort to boost the bottom line, a strategy that has become popular in Big Law. ‘There’s a lot more that people bring to a law firm than profitability: integrity, a cheerful demeanor, teaching ability,” he said. “These intangibles have more importance than I paid to them.”

“Durbin says he’s written two letters to a partner he had demoted. “I said that ‘I’m sorry. I have regrets. You were always good to me and this should not have happened.’” The partner never wrote back.”

“The 51-year-old Dallas resident says he’s gotten out of corporate law and has undergone an “interior change” These days, Durbin says, he is studying Spanish with the goal of helping underprivileged Latino children.”

Punchline:  Law is a profession… a calling… it has (and deserves) dignity…  may we please place a filter under the coffee of profit to ensure that we deserve to survive as a profession – shall we deserve to survive or shall we deserve to die.  This is directed at lonely Managing Partners whose constituencies persist that it is all about the PPP.  Maybe there is something else!

Note:  I haven't mentioned the firm name - does it matter?  If it does, see (WSJ subscription required): The Rise and Fall of ...

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I am not willing to bet against Cravath Swaine & Moore, are you?  In fact their strategic decision in creating an insolvency practice may be cause for additional respect rather than cheap shots.

The Wall Street Journal in a post called:  The Horror! The Horror! Cravath Starts a Bankruptcy Practice is quite hard on Cravath by referring to its new practice area as "declasse" and by asking whether " the ultimate white-shoe firm, has decided to scuff up its oxfords a bit".

But before deciding that the recruiting of former Skadden partner Richard Levin,  "one of the authors of the 1978 U.S. Bankruptcy Code" might be in some way negative, think about this. 

Perhaps the brilliant minds at Cravath have peered into their crystal ball and decided that $4.00 per gallon fuel, an expensive war, continuing low interest rates, a sliding dollar and a rapidly deteriorating housing market mean that many significant businesses are on a collision course with insolvency.

PUNCHLINE:  It will be interesting to see what the hindsight analysis on this event is two years from now when my speculation is that  Cravath Swaine & Moore and the word "ultimate" will be used in the same sentence without any reference to scuffing up its oxfords.

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"Buyouts alone accounted for 277 transactions worth $121billion in Asia last year" according to The Financial Express China is most popular destination for new law firms

"The economic boom coaxed US firms such as Orrick, Milbank Tweed Hadley & McCloy LLP, Cleary Gottlieb Steen & Hamilton LLP, Morgan & Finnegan LLP, and Thelen Reid & Priest LLP to open offices, while New York-based Shearman & Sterling LLP and Sullivan & Cromwell LLP applied for licenses. London-based Eversheds, Norton Rose and Clyde and Co, and French firms Bignon Lebray & Associes and Gide Loyrette Nouel also expanded into China and Hong Kong in 2006…"

Punchline:  Maybe the chatter about China not being profitable is simply not true.  However, the question is "if you're not doing the big deals, can China be profitable" and my view is that anecdotal information about governmental intereference and difficulty in enforcing payment of fees makes practicing law in China risky business for midsized firms. 

Your thoughts?

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According to The Wall Street Journal, "Mayer, Brown, Rowe & Maw LLP, on Friday said that 45 partners have been asked to leave or accept other positions there as part of a restructuring".

According to thier own web site, Mayer, Brown, Rowe & Maw LLP is among the largest law practices in the world, with more than 1,500 lawyers operating in 14 major cities worldwide including London, Frankfurt, Paris, Chicago, New York, Washington D.C. and Hong Kong.

Punchline:  I am not shocked that a law firm would cull its herd of partners but most do so discretely offering assistance to those affected to keep organic appearances.  This sudden and public move sends a message that is less than positive.  Why?

The story requires a subscription: Mayer Fires, Demotes 45 Partners

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Does law firm success equal commitments + uncertainties + calibrated focus?  (I didn't say the formula would be simple.)

I hope top blogger Guy Kawasaki will not mind my using his entire question #7 from his post today featuring Michael Raynor, author of The Strategy Paradox.

Please take a moment to read it in its entirety and then look at my law firm questions below.  I think there may be a profound lesson here if we are willing to transpose. 

In order to be thinking “law firm”, substitute the words “Management Committee” for “Board”, “Managing Partner” for “CEO”, “Department Heads” for “Divisional or business unit vice-presidents “ and “Practice Group Leaders” for “Managers”.

Guy Kawasaki’s 7th question: What’s the proper role in strategy formation for each level in a hierarchy?

Michael Raynor’s answer: I’ve found that it helps to think about strategy in two halves: the commitments that all successful strategies entail, and the uncertainties attendant to those commitments. Commitments and uncertainties are only half the answer. The rest of the solution lies in calibrating the focus of each level of the hierarchy to the uncertainties it faces. It is common sense—if not common practice—that the more senior levels of a hierarchy should be focused on longer time horizons. What hasn’t been as widely recognized is that with longer time horizons come greater levels of uncertainty, and strategic uncertainty in particular. This fact has some profound implications for how each level in an organization should act.

• Board members should ask: What is the appropriate level of strategic risk for a firm to take? What resources should be devoted to mitigating risk? What sacrifices in performance are acceptable in exchange for lower strategic risk? This allows the board to be involved in strategy without getting involved in strategy making, which is correctly the purview of the senior management team.

• The CEO should ask: What strategic uncertainties does the company face? What strategic options are needed to cope with those uncertainties? In other words, it falls to the CEO, and the rest of the senior team, to find ways to create the strategic risk profile the board has mandated for the firm.

• Divisional or business unit vice-presidents should ask: What commitments should we make in order to achieve our performance targets? For these folks, it’s no longer about mitigating strategic risks, but making strategic commitments. Someone has to take the actions that create wealth, after all.

• Managers should ask: How can we best execute on the commitments that have been made in order to achieve our performance targets? To put it on a bumper sticker, they have to “show us the money.” There are no strategic choices to make at this level, because the time horizons are too short—six to twenty-four months. Strategies simply can’t change that fast.

Now, here are my questions:

Do the various levels of your law firm’s management think like Mike Raynor suggests?

Is your law firm strip-mined every year (every penny available is distributed to the partners less the investments that are made over the kicking and screaming of individual objectors)?  If so, is your firm deprived of the luxury of long term planning/investing (or even medium term)?

It has been predicted that China will dominate earth by 2050 because of its long term orientation.  A recent article in the New York Times, From 0 to 60 to World Domination, shows how Japan’s Toyota leads the automobile industry with its long term thinking.

PUNCHLINE:  So, I wonder if the extraordinary success of a few large firms is due to the fact that they have grown big enough to be business-like and the individual partners simply don’t have enough relative power to mess it up?  I wonder further if a courageous firm will emerge that will operate as Raynor suggests and with Toyota's winning long-term orientation.  Should that occur, a lot of today's law firms will have a lot to worry about.

Your thoughts?

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Seth Godin explains this distinction simply with a post well worth reading: "The difference between strategy and tactics". 

Punchline:  My experience working with law firm leaders is that many are quickly seduced by discussions about tactics.  Perhaps they are more familiar with tactics than strategy or simply enjoy debating tactics.  The great firms have the discipline to do the right things well (rather than efficiently doing the camel-actions conceived by consensus).

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Lovells has more than 1600 lawyers in 26 offices worldwide and according to RollOnFriday "the firm has signed a deal with Cass Business School and from next month, lawyers who've been at the firm for around two years will take a two year business foundation course in the evenings. Once this is completed, they'll spend three years studying three MBA electives. Some lawyers will then be sponsored to complete a full MBA"

Lovells joins several other major law firms in obtaining significant supplementary education for their lawyers either in house or by arrangement with a prestigious school.   While this behavior may not be commonplace, it is certainly a trend to watch.

Food for thought:  Ask yourself why a law firm would make this kind of investment.  I suspect it has to do with profession-wide declining client satisfaction scores and the number one concern of top clients that law firms simply don't understand their business.  You have to give credit to Lovells for this initiative – I hope it pays off for them and will therefore be emulated.

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Dear friend, Sue Stapely, FIPR FRSA is thought to be the UK’s only practising solicitor providing comprehensive strategic communications counsel, with unrivaled experience, particularly working in the legal sector.

Read her July 20th article in UK's Law Gazette:

When reputations are on the line

Here's a tiny excerpt:

…we should also worry about the reputations of our firms. One slip, one oversight, one badly handled complaint, one aggrieved staff member can destroy overnight reputations that took decades to establish.




.

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When you fire a client, you might want to be a little more diplomatic than the title of this post (or the posture of the fellow above) implies — but, diplomatic or not, when it's the right thing to do, DO IT!

The primary purpose of marketing is to give you choices. Effective marketing allows you to improve your client mix and get rid of the ones who consume your life forces like voracious vampires — you know the ones, they don't pay (or pay VERY slowly), they argue, they test your ethics and they demoralize you and your best staff — and they don't wear watches, at least not when they call you at home at 11 o'clock at night.

Read Seth Godin's post "The Customer is Always Right" and simply substitute "client" for "customer" You owe it to yourself!

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"thinking first" may focus too heavily on the matter itself, interfering with deep understanding of the issues dividing people and actually preventing a good decision.

This is all according to a fascinating post today by my South African friend and Edge International colleague, Robert Millard, called Logic Not Always Best For Real-World Decisions

Robert discovered what he called a "startling conclusion" in an MIT Sloan Management Review Article by famous strategy authors Henry Mintzberg and Frances Wesley (more details in Robert's post).

Sometimes there are better ways — instead of thinking first, we can see first or do first.

PUNCHLINE: My take on this for Managing Partners (and others involved at the senior end of law firm management) is Robert is guiding us not to address problems in our old familiar patterns but to acquire the capacity to use diverse approaches depending on the situation. Check it out.

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Patrick J. Lamb

There are many voices on the subject of the management of law firms but very few have Patrick Lamb's depth of experience and accomplishment. Patrick continues to practice in a complex and specialized area of the law attracting and maintaining clients at the high end of the curve. I think his own track record entitles him to greater credibility than those offered by pure theoreticians.

In his post, Are There Definite Rights And Wrongs For Client Satisfaction Surveys?, Patrick explores the evolution of the discussion on this topic including some of my own contributions. I liked the way Patrick summed up his thoughts:

A lawyer or law firm gains from every face to face meeting with the client, and those meetings should be as frequent as possible. Most of those meetings should be directed to providing service or exploring needs that the client has. The client satisfaction meeting, however, is critical and must be treated as distinct, both in form and in substance. It is a chance for the spotlight to be shifted from the client to the firm, and for the client to provide insights that the firm should desperately want to hear about how it can render service in a way that makes the client happier, more satisfied and more committed to the firm. This keeps the client satisfaction meetings separate in the critical spot they deserve.

PUNCHLINE: Follow Patrick's sage advice - the most important part is getting out there and "doing it"!

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Jim Hassett

Thank you to Jim Hassett at his Law Firm Business Development Blog for continuing the conversation about Bullet Proofing Crown Jewel Clients with his new post regarding my thoughts on the comments of Steven Bell, Director of Sales at Womble Carlyle. See his post To Sell or Not to Sell in his Law Firm Development Blog today.

Jim's two part story on my recent presentation to the Marketing Partners Forum can be found in his recent posts:

Bulletproofing your crown jewel clients - Part 1

Bulletproofing your crown jewel clients - Part 2

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According to a story in the Toledo Blade today, Fuller & Henry, founded in 1892, "has all but disappeared… Its sign is gone from the door". The article goes on to say: "At one time, the business occupied two floors of the city's most prominent downtown office building but lately had just part of a floor. By the late 1990s, it had closed its Port Clinton office; several years ago, it shut its Findlay office, and a year ago, it left its Columbus office."

But here's the clincher:

Observers at other law firms say the defections and downsizings resulted from partnership disagreements over compensation and management.

FastForward: Most lawyers will share a sense of sadness at the events that have befallen Fuller & Henry but few will realize just how perilously close their own firm may be to a similar fate. As times become more competitive, the forces that could cause a stampede of exiting lawyers are not so remote. In my opinion, complacency is often the worst enemy. You might want to discuss this at your next executive committee meeting.

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Press Release

Just 30.7% of clients recommend their primary law firm
Low satisfaction drives client spending to new law firms

BOSTON, March 2 /PRNewswire/ -- The BTI Consulting Group's fifth annual survey of corporate counsel reveals an unprecedented drop in client satisfaction with law firms. Just 30.7% of large and Fortune 1000 companies recommend their primary law firms. These deep dips in client satisfaction, reports BTI, promise to drive dollars into the hands a new set of law firms, unsettling the status quo.
"Large clients are making broad-sweeping changes in how they hire and work with their law firms," comments Michael B. Rynowecer, BTI's President, "These changes will translate into opportunity for a select group of well-positioned law firms."

BTI's study analyzes how law firms can position themselves to benefit from these critical changes in a brand new report, How Clients Hire, Fire and Spend: Landing the World's Best Clients. BTI found an astonishing 53.7% of clients ousted their primary law firms in the past 18 months. More than 50% of clients also reported they plan to try at least one new law firm for substantive matters in 2006.

BTI conducted more than 200 independent, individual interviews with corporate counsel at Fortune 1000 companies and large organizations each year for the past five years. Find information on BTI's How Clients Hire, Fire and Spend: Landing the World's Best Clients and other compelling research in the legal services industry on BTI's website at http://www.bticonsulting.com or contact BTI at (617) 439-0333. BTI is the leader in providing high-impact market and client research to law firms and General Counsel.

For details, contact:
Michael B. Rynowecer
Phone (617) 439-0333
mrynowecer@bticonsulting.com

FASTFORWARD: Rynowecer's work has been extremely helpful to strategists within major firms. The trend he sites is alarming. I like his optimism that it means opportunities for many firms but it is a scathing condemnation of many established firms who are failing to Bullet Proof their Crown Jewel Clients. Could this in part be due to an ever increasing sophistication of demanding clients? Perhaps... but you know where the onus is. In my view, this should be a topic for discussion at your very next executive committee meeting followed by an action plan — it is only the firms who actually do something who will benefit from this crisis of confidence.

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Seth Godin provokes our thoughts with a very quick intellectual journey through service to expectations. In his post, What customer surveys measure, he teaches us not that serving and satisfying is impossible but that it is possible to do the former extremely well without doing the latter.

TRANSLATION FOR LAWYERS: Excellent legal work is not enough. Excellent work plus managing expectations plus exceeding those expectations is indeed enough. Is your firm doing enough? Are your individual lawyers and client teams doing enough?

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Follow me on a journey of logic — skip a decade to 2015 when air travel may dramatically increase in speed to 30,000 km per hour or 18,000 miles per hour — imagine a trip from Moscow to New York in 50 minutes or Moscow to Sydney in one hour and six minutes. (See reference to news story at end of post)

I contend that as the world continues to shrink, we will see a breed of global super lawyers who will go almost anywhere where there is a lucrative opportunity to bring unique skill and knowledge to bear on a legal problem.

What will this mean for competition — especially for the global firms. One might argue that they will be best positioned to exploit the opportunity because they can move their specialists around the globe more easily. However, it may also represent a threat to the global firms because agile competitors will be able to send top guns in without having to establish expensive local offices. A third possibility (my favorite) is that we will see even greater industry specialization such that any member of that industry will hire a known dream-team law firm the bricks and mortar location of which will be irrelevant.

I propose this as a serious planning issue, if not immediately, at least in the not too distant future. Competitive advantage comes from thinking ahead of the curve — not behind it.

Fasten your seatbelts!

(Story: Spaceflight from Moscow to New York to take less than an hour)

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Since Alvin Toffler's Future Shock and Third Wave we have been expecting accelerating change and while I comprehend it intellectually, change usually seems to be gradual — it just sort of creeps up on you.

Well, according to this National Public Radio story, here's a change you will notice.

If you are designing new offices, two restrooms, one for each gender, just may not be enough anymore.

Morning Edition, December 15, 2005 * The city council of Nova Iguacu, Brazil, has passed a bill requiring night clubs, movie theaters, malls and other public places to provide a third bathroom for transvestites. The mayor has yet to sign it. But the council says having only two options -- men's and women's -- is a big problem in a town with 28,000 transvestites. (Well, it is just outside Rio.)

I am not trying to be cheesy here, but let me ask you... did you see that one coming?

The additional irony here is that the story is about law — after all, that is what is being debated — a law forcing requiring three bathrooms in public places (albeit only in Nova Iguacu, for now).

For this one visible and rather remarkable change, there are thousands of more subtle ones from text messaging to internet in the friendly skies.

So, when you are planning, do not fall into the trap of simply doing a linear extrapolation from the present - or you may get caught with your pants down — or should I say panties — maybe even in the wrong restroom.

Thank you to Tom Peters Wire Service for the story

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This post by Andy Havens on Larry Bodine's LegalMarketing Blog is a "must read".

PUNCHLINE: Five years from now law firms who are not paying attention will be trying to play "catch-up", an unfortunate strategy. Am I saying to Managing Partners: "join" — no... I am saying at least keep a watching brief.

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Adam Lewis, a Director and the Managing Partner of the Australian and New Zealand practices of McKinsey & Company, was one of my co-presenters at the World Masters of Law Firm Management last week, in Sydney.

Adam told us a number of fascinating things about McKinsey, one of the premium consultancies in the world. Among them were two gems:

1) McKinsey & Company has no internal marketing department. (Why not? Because the consultants themselves market the firm.)

2) 2/4/8. Every Director in the firm is required to be working on "2" assignments, be in the process of proposing for "4" more, and in communication with "8" more prospective clients.

Management within McKinsey follows up to ensure that "2/4/8" is a reality.

Some superb marketing professionals in some extraordinary law and accounting firms confided in me that if their fairy godmother granted one wish it would be that their "professionals" would interact with clients beyond just doing the work.

It sounds like McKinsey's "2/4/8" means that the fairy godmother has already visited McKinsey & Company.

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Bravo to Womble Carlyle Sandridge & Rice and Molden Holley Fergusson Thompson & Heard for their ingenious alliance to create and market diversity.

Molden Holley is a small and new African-American firm comprised of partners who came from major firms. In what appears to be a brilliant win-win alliance, this new firm will continue to be independent but will bolt on all of the resources of AmLaw powerhouse Womble Carlyle when and as required; meanwhile, Womble Carlyle gets to demonstrate to clients like Wal-Mart and Sara Lee that it is listening to their General Counsel who have been requiring all of their legal providers to make rapid diversity progress.

(For further particulars on those diversity requirements, see my post titled: Law Firms as "Exclusive Clubs for White Men")

PUNCHLINE: While other firms may not yet have diversity on their radar screens and while those who do are likely progressing slowly and in a linear fashion, these two firms are hitting warp speed.

The most fascinating part of this story is yet to unfold. It's the marketing initiative (contained in this quote from the complete story in Small Firm Business — referenced below):

"Regina S. Molden, the managing partner for Molden Holley, said members of the two firms will meet monthly to develop a marketing strategy targeted towards existing and potential Womble Carlyle clients seeking more diversity."

WOW! Imagine the potential here. This is not smoke and mirrors but rather a very real capacity to provide diversity to clients IF those diversity-demanding clients are prepared to accept that the alliance is genuine and truly fulfills the spirit of their diversity requirements.

Whichever firm initiated the idea, it is an illustration of strategic genius — especially if it works. If it does, it will be a pattern worth emulating.

For a more particulars, see the full story filed by Meredith Hobbs in the Fulton County Daily Report on July 29th as published in Small Firm Business: Big Firm Partners With Minority-Owned Boutique to Increase Diversity

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In a recent Edge International Survey on Strategic Planning, we learned the following:

10% of firms have a strategy to remain flexible and opportunistic ("OK!")
13% of firms are in the process of preparing a strategic plan ("We believe you!")
15% of firms have a strategic plan but have not committed it to writing ("Oh my!")
60% of firms have a formal, written strategic plan ("Congrats — if all your people know what it says")
2% Other responses

If you ask most lawyers where their next matter will come from, they will say something like "it depends…". If asked: "depends on what?" the response is typically "depends on who calls or writes or faxes or emails next". Great plan. You just sit there like a grain of sand on the beach and your next work opportunity depends on the the nature of the next wave that rolls in.

Planning is about making choices about what you prefer to do. You earn the right to do those things by providing more valuable legal work that the right prospective clients can appreciate.

PunchLine: If you don't have a written plan, you don't have a plan. If you don't have a plan, then you are a ship without a course… and guess what happens to ships without a destination.

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Is Diversity on your management agenda? Has it ever been?

This is a serious wake up call to every single member of your law firm's management team.

Diversity is not some do-good-philanthropic-topic for a tea party of the rich and bored. Diversity is serious business: serious to business; serious for business… not to mention that it is the right thing to do.

In her Law.com article today, Wal-Mart Demands Diversity in Law Firms, Meredith Hobbs explores the demands that General Counsel in major corporations are placing at the doorstep of law firms.

The General Counsel referenced in the article are in the following companies:

Wal-Mart
Visa International
Del Monte
Pitney Bowes
Cox Communications

The article goes on to say:

So far, close to 100 general counsel have signed on, including those from some of the nation's biggest companies.

If you think you can get by this issue with tokenism, you need to understand what is being demanded of you. For example, the article includes these quotes:

The nation's biggest retailer wants to see diversity at the top.

The goal… is to "increase the number of women and minorities directly responsible for [our] relationship at our law firms."

"We are terminating a firm right now strictly because of their inability to grasp our diversity expectations,"

In her Separate but Equal article in Marketing the Law Firm, a Law Jounal Newsletters publication, Elizabeth Anne 'Betiayn' Tursi offers this advice:

The idea that law firm leaders need not be at the helm of these initiatives can only mean that it will be doomed to fail. The chair or managing partner of a firm must be a proponent of the causes and must be involved in every aspect of promoting the initiatives. In the case of creating this particular blueprint, management serves as the "project leader" or lead architect. Leadership can set the tone for the institution of these initiatives and is in the enviable position of selecting others in the firm who can also promote and develop the actual initiatives. And yes, there should be a chair for each initiative — diversity, pro bono, recruiting and marketing — who meet once a month, with the directors of these initiatives to ensure that they are working together to develop the blueprint, and also to make certain that these individuals are in a positions that enable them to have a voice in implementing the programs to achieve the intended result.

Notes:

1) The title of this blog is based upon this quote from the Law.com article:

It is no longer enough, the general counsel at the symposium said, to raise the numbers of women and minority lawyers in a firm's lower ranks if its upper echelons remain an exclusive club for white men.

2) Photo Caption (Thank you Purdue)
A Purdue sociology professor explores racial and ethnic relations in his book "Diversity and Unity." Martin Patchen says inequalities among ethnic groups often lead to prejudice, segregation and discrimination. (Purdue News Service photo illustration by Vince Walter)
Color photo, electronic transmission, and Web and ftp download available. Photo ID: Patchen.diversity
Download Photo Here

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The Winter 2005 edition of our quarterly magazine, Edge International Review, is now available for downloading as a PDF.

This is a full color 40 page magazine so may takle a few minutes to download. (Some browsers will display the magazine without downloading it.)

Senior management team members in law firms may request a complimentary subscription to the hard copy version by sending me an email.

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Orrick Herrington & Sutcliff is a magnificent firm that had the courage to be innovative and create a Virginia based service center for itself.

…and now, according to an article in The Lawyer.com:

Orrick Herrington & Sutcliffe is planning a new outsourcing services company for other law firms.

"The truth is that the global 100 are competing with each other, but most lawyers aren't in those firms. There's a whole universe of lawyers who are spending inordinate amounts of money doing their own finances and supporting their technology and we can do it for a fraction of the cost," said Baxter.

Fast Forward: There will be amazing challenges — watching the outcome will be akin to NASA scientists watching Deep Impact. There will be surprises and perhaps more success than many will have the courage to predict.

Punchline: Whatever happens, keep an eye on this and learn from it — we don't see too many clear transitions in the practice of law — if this works, it will in hindsight have been a big one.

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I believe this is the most important story in the legal profession in your lifetime, even if you are a centenarian. It redefines the debate as to whether law is a profession or a business. According to today's Financial Times UK edition,

"One in 10 of the 100 biggest law firms have indicated they could seek a stock market flotation in the wake of planned rules allowing outside investment in the legal sector."

And of those who are not contemplating a flotation:

"one in five expected their firms to seek outside investment"

"Two-thirds of the managing partners, in effect the law firms' chief executives, said their firms were likely to admit professional managers to the partnership."

Food for thought - Good News and Bad News:

The Good News: The notion of allowing non-lawyer partners would permit key support professionals like Executive Directors, Financial Officers, Marketing Directors, Training Directors, IT Managers, Knowledge Managers etc etc to have a stake in the business. I am OK with that - especially if it reduces the "us vs. them" attitude that is so prevalent between lawyers and non-lawyers in many firms.

More Good News: Investing in the firms future by enabling it to improve value to clients through training and infrastructure is a great idea.

Final Good News (sort of): A few wealthy people will get much wealthier in the initial deal (it's called cashing out). Maybe they promise to stay around for a while for cosmetics and even shake a few hands now and then, but let's not be coy, the desire of power partners to get a whopping return is what will drive these deals. Some not-so-senior partners will get some good cash too. (Where were those lake cottages for sale again?)

The Bad News: Selling a stake in the firm, whether to the market or an investor, is suicidal. This investment comes with a built-in poison pill. Here is the progression:

Step One: Senior partners cash out. (Note, Step One of Bad News is borrowed from Good News... as Leonard Cohen sang, "we are locked into our suffering and our pleasures are the seal".)

Step Two: Everyone feels very excited - they will now be a part of something big and supposedly wonderful and corporate - perhaps the firm will even be managed now. There will be champagne and hats and lots and lots of publicity. (Clients will yawn).

Step Three: Reality sets in... these investors want WHAT? ... a return on their investment… off the top? What are you talking about. Profits are for partners. Oh, and those things that we used to do because we thought it was fitting for members of the profession to "give back" are not going to get approved without a business case for how they generate new fee income? The grey area between business development and boondoggles will be grey no more. Fly economy, buster. We have standards of performance that are enforced and your friend in the corner office can no longer protect you (she already cashed out, remember?).

Step Four: "Hey, wait a minute", say the young Turks, "why should we suffer in a firm where 20% of our profits, off the top no less, go to outside investors? Hmmmm, I could be generating the same income in a firm that does not have outside investors… hmmm, let's consider this for a nanosecond. [The next sound you hear is the whirring revolving doors as the up-and-comers leave for greener pastures.] (Greener pastures are defined as firms who were not daft enough to get on this bandwagon in a moment of mind numbness.)

Step Five: The remaining productive career-oriented partners say "this isn't working" and the investors are saying the same. We are losing talent, morale has plummeted, no-one listens to the turn-around CEO you brought in from industry… the future is far from bright if we stay on this path… "better liquidate".

Step Six: The remaining partners make an offer to buy the firm back from the investors for 10 cents on the dollar (or 10 P on the Pound Sterling) and the episode fades into oblivion.

For those who are thinking: "this story is about the UK - not our jurisdiction" I will simply remind you that the largest firm in the world is based there—along with a number of other global legal powerhouses.

I would like to extend my congratulations to the 9 out of 10 biggest firms who are not contemplating a flotation and the four out of five who are not interested in private capital either. You are the wise ones - you don't need capital that way - you can generate your own. After all, you are in a people business - you do not compete with Intel. If you did, you might need a few billion for a plant in Asia. All you need is to keep your wits about you as a few of our colleagues proceed lemming-like into the sea… I'll see you at the Carlton Club and we can lament their tragedies over a cognac.

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From the Art of War Blog:

Strategy teaches that we can never see our own position. We need outsiders to give us perspective.

You may want to look at the full article, however, the point is this: law firms rarely have an outside board member or a client mentor - instead we tend to fear the input of non-lawyers. Why? Is it because they really don't understand or we fear they may see us with clarity?

I do not think we fear clarity - I think we fear having to convince our partners that our myopic preconceived notions are sometimes plain wrong.

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So Fast Company (which is up for sale if you want a once great publication) is chatting about Tom Peters whom I mentioned recently... look at this sidebar as a teaser and then check out the full article...

Sidebar: The Peters Principles

A sampling of some of the most important themes covered in Tom Peters's new book, Re-imagine!

Destroy to Create

Forget about Built to Last. All companies, Peters says, are doomed to failure. Better to completely destroy your own company from the inside and remake it in a new, bold and creative way than fight old battles with old ideas -- and eventually fade away into irrelevance.

Women Roar

They are the most important group in our economy. They spend and make most of the money. They make the key financial decisions. And yet they are talked down to, never designed for, not consulted, fundamentally ignored. The New Economy runs on the principles that women are used to -- collaboration rather than command and control, for one -- and until men realize that and change their approach, they are doomed to failure.

It's an XF (Cross-functional) World

Nothing works without honest and open communication between decision makers. So you can be as idealistic and as big picture as you like, but you won't get anywhere without the human element. Peters says it's best to embrace the politics and demolish the red tape. Only then can you move on to the greater objectives of changing your company.

Power Dreaming
Successful companies such as Harley-Davidson and Starbucks work because they sell a lifestyle or an image rather than simply a product. For Harley, it's the experience of the rebel; for Starbucks, it's a place of refuge. Successful companies must offer a "scintillating experience" in order to set themselves apart in an environment where most competitors already provide a decent product.

Think Weird

The only way to effect true transformation in the workplace, says Peters, is to enlist the outliers in your organization to join your cause. Find the weirdos and the freaks, offer support for the projects they're secretly pursuing, then get them to help you with your own revolutionary change ideas.

Design, the ultimate edge

In the world of Tom Peters, design is so critical that it should be on the agenda (along with a professional designer) of every meeting in every single department. Design, like lifestyle, is one of the few differentiating factors, and companies that ignore the power of elegant and functional design will lose.

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Tom Peters wrote In Search of Excellence and changed the way we look at business forever. He has written many other business best sellers since, like "Re-imagine!". (For a more thorough list, check out some of his other publications at the Wow! Store.

Most law firm leaders are too busy to read business books - OK, you can be forgiven... but at least subscribe to Tom Peter's Blog and get the benefit of some of his awesome thinking (and from a few of the people he respects).

Take a look at his blog: The Pinnacle of "Change Management" and see what I mean.

Food for Thought: Guard against the reaction that "this stuff" does not apply to law firms - that law firms are different. Instead, ask yourself, "how might this apply - what elements transcend business and apply to professional service firms?"

I believe that the prize will go to those who import ideas from outside our profession... and apply them in an imaginative way. Tom Peters can help you do that.

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Five Year Plan Every Day

Real law firm clients take me beyond the academic into the practical and real. One of the founding partners of a highly specialized boutique law firm uttered these words in a strategy meeting this weekend "five year plan every day". This is an extremely vital illustration of dynamic planning.

The default pattern or reasoning for most of us as lawyers is that we should mold that exquisite plan and then sell it to our troops who will enthusiastically execute it. The real world, though, requires sequential plans thus creating over time a dynamic map that updates for changing circumstances. One of the founding partners of my client was thinking exactly this way as he provided an in-depth briefing to his partners on the landscape of the firm's marketplace. He had identified the clientelle, existing and prospective, their relevant "numbers" (size of their operations; potential fees) and their own place on their respective evolutionary curves.

In a world of consolidation, he provided the evidence that would support rational predictions of which existing and prospective clients would be acquired, by whom, and where the power would then reside, both corporately and geographically.

This partner creates a dash board of intelligence that he constantly updates. Now I ask you, what are the chances that his firm will continue to flourish? Yes, you are right - very high.

The firm is receptive to change and plans for it… unlike so many firms I know who have partners with sandy faces and necks from their ostrich-like behavior, petrified that something might change... appreciating their vulnerability but feeling ill-equipped to do anything about it.

So, do you have a five year plan every day?

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This is a quote of Craig Barrett, the chief executive of Intel, in three time Pullitzer Prize winner Thomas L. Friedman's column in the New York Times yesterday.

Friedman goes on to say that

"[Intel] can now hire the best brain talent "wherever it resides."

Food for thought: After you read Friedman's full article, ask yourself why you and I can't be replaced by someone offshore (except, of course, that I already am offshore). The other serious question is, are we going to keep hiring for our law firms "the way we've always done it" or should we perhaps be paying a little closer attention to Andy Havens when he blogs about offshore talent for law firms in his Outsourcing blog.

The operative question is: To what extent can your law firm be totally successful without ever hiring another American (Canadian, British, Australian - you get the idea) lawyer? Should you consider moving in that direction, and if so, to what extent?

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DuPont Legal recently announced that it is honoring Kilpatrick Stockton LLP as one of a select number of firms receiving this year's "Meeting the Challenge" award, according to dBusiness News in Atlanta, but why?

Here's a clue:

In particular, Kilpatrick Stockton is acknowledged for its:

* Outstanding legal services and results in all areas of litigation and appellate work;

* Collaboration with other DuPont Primary Law Firms and Service Providers; and

* Participation in and support of the DuPont Legal Model and leadership in paralegal utilization.

See my post regarding the Dupont model.

Food for thought: What is your firm doing to add value to your clients the way Kilpatrick Stockton LLP is (thanks to a little encouragement form Dupont).

The Dupont model is the future. Can I prove it, no. Can I promise it, yes.

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The Art of War Blog has used a stimulating phrase "fail forward" in their recent blog entitled What We Know and What We Don't.

"The science of strategy is based on a simple fact: we only know the tiniest fraction of what there is to know. This is true both of us as individuals and, because what we know is so small, of the largest groups, which combine our knowledge. When you think about everything that there is to know and compare it to what we actually know, our ignorance is monumental. Because of this, strategy is built to be very accepting of failure. The idea is to "fail forward" in such a way that, even when what you try doesn't work, it puts you in a better position after your move than before it."

Food for thought: It is quite natural for the best lawyers in the blue chip firms to be perfectionists, at least in so far as the practice of law is concerned. However, when it comes to formulating strategy, I believe that the perfectionist mindset must be suspended in favor of taking action. Many good firms are paralyzed by perfectionism and out-maneuvered by those who are willing to try things and learn from their efforts. It was Edison who was asked for a comment after trying over 2000 times to make a light bulb and still failing - he responded by saying he was the only person who know 2000 ways not to make a light bulb. Of course the firm must guard against embarrassing itself or offending clients but, at the same time, the willingness to fail is essential for learning how to become premiere business developers. Even amazing lawyers in amazing firms must fail on occasion, but when they do, they "fail forward".

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This is dejà vu of the now famous Dupont Model crafted by then inside lawyer Dan Mahoney. According to the Chicago Tribune wire reports published April 19, 2005, Allstate Corp will cut the number of outside law firms it uses each year to 13 from as many as 400.

Food for thought: This is indicative of a trend that many law firms don't want to think about. Obviously Kirkland & Ellis did because they have already been selected as one of the "chosen".

Law firm leaders should be anticipating this trend and assiting their clients in exploring the benefits of this strategy. What better way to make sure you stay on the short list, like Kirkland & Ellis did, instead of sliding into oblivion where all but 13 of Allstate's 400 law firms are going.

The surviving 13 firms will have to manage better, serve better, and, if like the Dupont scenario, share knowledge with competitors. The benefits will be enormous for both Allstate and the surviving firms.

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