It’s 2023, and the fundamentals of running a law firm are suddenly up for debate. What does practicing law look like? How are law firms organized? Can technology replace some or all of what we do? Three years ago, I think most of us would have had confident answers to all of those questions, yet today the answers aren’t so clear. Against this backdrop, law firms need to make some of the most critical strategic decisions they’ve ever faced. Are you and your firm ready?
Let’s start with the most existential question: How essential to the law are lawyers? The answer used to be self-evident. As a profession that gets to make and enforce the rules governing the practice of law, attorneys have traditionally been well-insulated from outside pressures. The bar’s monopoly on practicing has shown a few cracks over the past years, with some states piloting programs such as Arizona’s Alternative Business Structures and Legal Paraprofessional certification, but, overall, lawyers have kept a tight grip on the ability to actually practice law. No one gets into the party without passing our rigorous bar examination process.
And then GPT-4 passed the bar with a higher score than most of the humans taking it.
The age of the robot lawyer is upon us, whether we want it to be the case or not. Generative AI models like ChatGPT aren’t going anywhere and will only get better over the coming years. The legal industry, which is based on digesting a large corpus of written law and finding ways to use those past examples to predict future results, is squarely in ChatGPT’s wheelhouse. Potential clients won’t need to dial up an attorney for a preliminary review of how the law might apply to the facts of their case. And sophisticated clients may seek to keep more work in-house using Generative AI tools, or may demand their human counsel avail themselves of the efficiencies large language model AI promises to offer to keep their billing rates down.
If you think ChatGPT remains too clunky and unreliable for most legal purposes today, please recall that it wasn’t that long ago that cellphones were too bulky and expensive to be of any real use, and even less time has passed since modems were too slow and cumbersome for the internet to bring significant value to the table. Major players in the legal field have already begun moving toward integrating AI into their practices. Firms like Skadden, DLA Piper, and Orrick are all playing in the space, and Lexis is releasing its own Chat-GPT-powered product shortly.
AI is here and it’s not going away. Law firms that want to still be here in 20 years need to start understanding large language model AI and finding ways to fold those tools into their own offerings today.
The Phantom Office Space
Now that the pandemic has reached its end (at least from the bureaucratic standpoint), many management teams in the legal and broader business worlds have been pushing for a return to physical presences in office. The only thing standing in the way of that return to the classic model of busy workers filling the office with the hum of productivity is, well, everything else that happened over the past few years.
We made full-time remote work happen because the pandemic forced it. Now that we know it’s possible, we can’t credibly pretend things have to go back to the way they used to be. Young attorneys especially are placing a massive premium on flexibility to shape their work lives around their personal lives, cut their commute times, and leverage the technology that they grew up steeped in. One consultant I spoke with recently was working with firms that have tried to adopt the three days in, two days at home model, and by and large they’ve seen it fail. Lawyers just don’t want to come into the office if they don’t have to.
Spending time in offices together can have real benefits, such as building camaraderie, sparking unexpected conversations and ideas, and generally contributing to the development of a healthy firm culture. But what use is that if people just aren’t going to go back? It doesn’t matter how much I tell my kids broccoli is good for them if I can’t get them to eat it. We need to stop wishing people would do what they won’t, and start looking to other methods of building our firm cultures that are compatible with what our attorneys want and need.
The firms that thrive in the coming years will be the ones that stop complaining about the problems that come with a hybridized, remote-friendly law firm and focus on investing in the infrastructure and systems to make them work. If we can’t count on water cooler chats to build the team, we need to get creative and find other ways of giving our teams unstructured, casual time together without forcing them to constantly be in the physical office. If training is harder over Zoom, then we need to get better at training. We don’t succeed by ignoring change in the world. We succeed by accepting the situation as it is, and making it better every day.
The Permanence Of Change
Either of the issues discussed above could be its own column, or heck, its own book. Each presents a monumental set of issues for the most talented management teams on the planet to grapple with. What’s truly terrifying for law firm managers, though, is that both these issues just popped up in the past couple of years, both demand fundamental rewrites of how to operate a law firm, and neither is likely to be the last major sea change of this decade. The pace of change in the legal and business world seems only to keep increasing, and law firm management will need to move just as swiftly to keep up and stay ahead of the competition.
Change has rarely been the legal profession’s forte. Stare decisis is at the heart of our industry, practically, philosophically, and emotionally. But resisting change just doesn’t work anymore. Law firms today need to either ride the wave or get washed under it.
Law firm management looking to thrive in the coming decade needs to be swift and adaptable, ready to embrace change as an opportunity for growth. But more than that, we need to find ways to teach our colleagues how to do the same. The lawyerly tradition of hunkering down into endless debate and hand-wringing while waiting for another firm to make the first move can’t work anymore. We need to build cultures devoted to identifying problems, reaching consensus quickly, and acting decisively on difficult issues.
Tomorrow is here. The moment of truth is arriving. Where is your firm going to land?
James Goodnow is the CEO and managing partner of NLJ 250 firm Fennemore Craig. At age 36, he became the youngest known chief executive of a large law firm in the U.S. He holds his JD from Harvard Law School and dual business management certificates from MIT. He’s currently attending the Cambridge University Judge Business School (U.K.), where he’s working toward a master’s degree in entrepreneurship. James is the co-author of Motivating Millennials, which hit number one on Amazon in the business management new release category. As a practitioner, he and his colleagues created and run a tech-based plaintiffs’ practice and business model. You can connect with James on Twitter (@JamesGoodnow) or by emailing him at James@JamesGoodnow.com.