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Legal Careers in the Global Age of More for Less: Insights from Professor David Wilkins of Harvard Law

Professor David Wilkins of Harvard Law School explains what law firms and law schools must do to succeed in an increasingly globalized and complex world.

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The legal profession has changed greatly over the almost seven years since the launch of Above the Law. Do these changes amount to a paradigm shift? Or are they just a temporary blip that will eventually be reversed?

Professor David Wilkins, Director of the Program on the Legal Profession at Harvard Law School, is one of the most astute and well-informed observers of law as both a profession and an industry. In his recent keynote at the NALP annual education conference, Professor Wilkins considered these questions, and also shared his predictions about the future of the legal profession….

On the issue of paradigm shift versus blip, Professor Wilkins said that it’s too early to tell but that it’s unlikely to be either. We’re not going to see the death of Biglaw, as some have prophesied, but we’re not getting a return to 2007 either. Instead, we’re seeing the accentuation of macro-level forces that began before the crash, and these forces are reshaping the global market for legal services. Law firms must adapt to the new reality.

Professor Wilkins identified several structural changes:

  • the globalization of economic activity;
  • the rise of information technology; and
  • the blurring of 19th-century categories of knowledge and organization.

The consequences of these changes include:

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  • a reduction of information asymmetry between buyers and sellers (buyers are more savvy, and they’ve been able to “unbundle” the services they utilize — e.g., having a law firm handle strategy and an outside vendor handle document review, instead of having the law firm do both);
  • a shift in competition away from reputation and credentials and in the direction of valuation, measured by metrics (buyers care less about inputs and more about outputs); and
  • the unit of analysis moving away from specific firms and in the direction of networks of relationships (less about clash between competing firms and more about competing networks).

The new environment places pressure on law firms in several ways. Clients are more focused on “value” billing, which can reduce law firm profit margins. Law firms face new competitors, such as legal process outsourcing (LPO) firms that offer integrated services at the intersection of law, finance, strategy, and project management. As clients reduce their demand for high-end, “bespoke” legal services, Biglaw can no longer rely to the same degree on the traditional drivers of revenue: rate increases and leverage.

Of course, the changes aren’t all bad news for Biglaw. For example, as globalization picks up, clients will need more help in understanding how globalization affects both domestic and cross-border business — and international law firms will be well-situated to benefit from this increased demand.

To succeed, law firms will need to pay greater attention to the needs of their clients. There’s currently a gap between law firm and in-house perceptions of what constitutes good client service. To law firms, “client focus” means “doing what’s best for the client” — even if that means chasing down every last idea or possibility, no matter how expensive. To in-house lawyers, “client focus” means “understanding the client’s business” — which is a much more practical and cost-conscious worldview.

How do corporate counsel select outside law firms? Citing survey data, Professor Wilkins identified three key factors: results obtained in similar cases or matters, reputation, and any prior relationship between the company and the firm. To get information about these factors, general counsel rely on personal knowledge, conversations with their colleagues at the company, conversations with lawyers at other firms, and public sources of data (in decreasing order of importance).

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General counsel today are far more metric-driven than in the past, with a greater emphasis on quality control and accountability. They want outside law firms that aren’t just “agents” but “partners,” who share both risks and benefits with the client. To achieve this kind of partnership, companies and firms need to manage the attorney-client relationship at multiple levels. Such close collaboration can be promoted through secondments, in which law firm attorneys are dispatched to work at the client for a time, and through technological tools that allow for greater information sharing and cooperation between different people at the company and at the law firm.

These changes in the practice of law require changes in the model of legal education. Career success requires (1) specific skills and competencies, (2) relationships and network-building, and (3) credibility and professional image. Law schools, unfortunately, don’t focus on developing and testing for these qualities; instead, they call upon students to “regurgitate the pet theories of their professors,” as Professor Wilkins colorfully put it. If law schools want to remain relevant and viable, they will have to shift towards preparing their students for practical workplace success.

Despite the many challenges faced by both law firms and law schools, there is much to celebrate, Professor Wilkins noted. First, diversity is growing within the profession, and companies and law firms are increasingly committed to it as a value. Second, the legal market is rebounding, even if not as robustly as some might like. Third, increases in globalization and complexity of legal issues will drive at least some increase in the demand for legal services over the long term.

Professor Wilkins concluded by citing what some call the “Chinese curse”: “May you live in interesting times.” For better or worse, these are undoubtedly interesting times for the legal profession.

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