Biglaw, Job Searches

Reinventing The Law Business: Where Is The Legal Profession Heading? (Part 2)

According to managing partner Bruce Stachenfeld, if a verein is brilliantly managed, it will succeed -- and if not, it will fail, with probably a spectacular flameout.

By  
on

This is the second article in a four-part series dealing with my predictions for the future of different types of law firms as the legal profession changes. In this four-part series I will be writing about:

  • Branded Law Firms
  • Super Mega-Big Vereins
  • Pure-Play Law Firms
  • Regional Law Firms
  • Single-City Law Firms
  • Solo Practitioners and Firms with Less Than Ten Lawyers

Super Mega-Big Vereins

In the previous article I wrote about Branded Law Firms. In this article I will discuss Super-Mega-Big Vereins.

The Dentons Daching-type verein is going to require management genius to succeed. Bigness alone will never be a substitute for better. Indeed, show me a single lawyer, or client, who wants to join a law firm just because it is the biggest (except maybe someone who wants to use it as a stepping stone to another job)? Or a client that hankers for the biggest law firm around?

Nor will just being in multiple cities do it alone. Clients aren’t dumb enough to believe that just because you have an office in Pleasantville this means that you have the best lawyers there. And sooner or later clients will wonder how on Earth (since you are covering the entire Earth) a firm with 50 global offices can have the slightest bit of quality control. Finally, if I was a powerful and strong branded firm, where my partners were making a lot of money, and I wanted to open an office in a new location, the first place I would try to raid is one of these behemoths. And I wouldn’t take the weak ones – I would go for the best and offer them the world to take the job.

Does that mean the mega-verein is (eventually) left with the losers? If so, ugh! For this reason, the sine qua non of success or failure will hinge on brilliant management. Somehow – and some way – management must create a culture – create a reason to exist – create not only economic upside but the prospect of more economic upside in the future – for its key personnel, or it is merely a fat chicken to be plucked.

Sponsored

So my thinking is that if the verein is brilliantly managed it will succeed and if not it will fail, with probably a spectacular flameout. And how easy is brilliant management of a law firm? How easy is it in a mega-firm structure to emphasize the good points, and minimize the bad points, of the major branded law firms? Well, I think I am pretty smart and talented, and it requires all my skill on a 24/7 basis to manage my 70-lawyer firm with a modicum of success. And I have a sort-of-depressing half-joke that I say all the time, which is: “After eighteen years, the only thing I am ‘sure’ of is that it is really ‘hard’ to run a law firm.” I have no idea how one would manage 2,000, 3,000, 4,000, or 6,000 lawyers.

So my prediction is that while the U.S. economy stays strong and the global economy stays decent these vereins will all exist and thrive, or have the appearance of thriving. However, the next significant contraction in legal work will result in at least one spectacular failure, and maybe more than that. I note that the next significant contraction in legal work is not necessarily tied to the business cycle (since many times lawyers actually garner great legal work out of business distress). I will say that I think the date of this contraction in legal work is comfortably far off – at least a year or two (barring a world event like a health disaster or major war) – so I would say that the vereins have some time to establish great, strong and powerful firms before the next contraction.

As far as top law students starting their careers, my advice is the same as for the branded law firms. If they will get the great training and great industry contacts, then a mega-verein is a great place to start a career. There will be the résumé cachet (I think I have now coined this phrase?) and career mobility and good compensation.

For a lawyer with a major practice, this is a bit murkier. I guess all things being equal I would much rather move to a branded law firm than a verein, if you have the option. My thinking is that with 2,000 to 6,000 lawyers, even a heavy hitter is too small to move the needles. This means she will be at the mercy of events that are outside her control, and even outside the control of management. I wouldn’t like this randomness. I also would hate to think this way, but I would have to think, a lot, about what would happen if things don’t work out, so I would have to negotiate my employment with one foot out the door. I would need to control “my turf” and it would be hard for me to truly cooperate with my partners, which we all know by now is important for law firm success. Finally, I would guess that the concepts of “culture” and “verein” will not be in the same place absent the brilliant management I refer to above, so there is more of a firm failure risk than is obvious. Overall, I would count it as a second choice to a branded law firm.

As far as a mid-level or senior associate hoping to “make partner” or the junior partner finding out that partnership isn’t really much more than glorified associate-ness, my advice is the same here as it is for the major branded law firm. Unless you can assess a solid path to partnership, you should get out as fast as you can before you become trapped and effectively enslaved.

Sponsored

I will be continuing this discussion in the next article in this four-part series.

Earlier: Reinventing The Law Business: Where Is The Legal Profession Heading? (Part 1)

Bruce Stachenfeld is the managing partner of Duval & Stachenfeld LLP, which is an approximately 70-lawyer law firm based in midtown Manhattan. The firm is known as “The Pure Play in Real Estate Law” because all of its practice areas are focused around real estate. With 50 full-time real estate lawyers, the firm is one of the largest real estate law practices in New York City. You can contact Bruce by email at thehedgehoglawyer@gmail.com.

Topics

, , , , , , , , ,