Two decades ago we lived in a radically different legal world:
- A shingle and a yellow pages ad would bring in plenty of legal business.
- The competition was the law firm down the street.
- Breaching a firm’s security meant breaking down a door and prying open a filing cabinet.
In comparison, the 2018 legal marketplace is practically a sci-fi flick. Consider what four legal experts say are the two of the most pressing issues for small law firms: hackers and cut-throat competition from across town and across the country. They insist that both can cause even the most successful small law firm to stumble.
Don’t Think Hackers Aren’t Targeting You
In July, Logicforce, an IT consulting company, release a report based on a survey of more than 200 law firms, analysis of anonymous system monitoring data, and results from their on-site assessments. This revealed that small firms have the same risk of being hacked as large firms and an average of 10,000 intrusions happen daily.
“Many (law firms) aren’t doing enough when it comes to protecting themselves,” the report said. “It is truly not a question of if, but when, an incident will occur.”
Nerino Petro agrees. He’s CEO of a legal technology consulting firm, and technology co-editor for the ABA GP|Solo Magazine. He also serves on the board of the ABA TECHSHOW. He points to an exponentially increasing number of threats by ransomware – phishing emails that convince people to click on a virus-laden link or attachment – that give hackers access to law firms’ information, time-and-billing records, bank accounts and client files.
“The cost of a data breach can easily put a small firm out of business,” he says.
He advises mitigating the risk by:
- Installing the most current firewall, antivirus and malware protection
- Education that helps staff recognize phishing emails
- Data backup that’s isolated so viruses can’t reach it
Jim Calloway also advises examining how you communicate with clients. He is the Director of the Oklahoma Bar Association’s Management Assistance Program where he frequently writes and speaks about legal technology issues, and was co-chair of the ABA TECHSHOW.
He believes you should consider whether emailing anything significant to a client is appropriate and use client portals instead. These online interfaces allow you to securely exchange. The best portals provide total encryption, and are integrated with law practice management solutions to streamline communication and matter management.
“We have an independent, ethical responsibility to protect our clients’ confidential information,” says Calloway. “That’s why it’s so important for lawyers to err on the side of protecting client information, even if they may not see examples where unencrypted email has gone wrong.”
Respond to Unprecedented Competition
The legal marketplace is burdened by decreasing demand coupled with oversupply exacerbated by DIY services like Legalzoom and Avvo, and the venture capitalists who are investing in others like them. It’s one of the primary reasons law firms must:
- Differentiate themselves, says Ellen Freedman. Freedman is the founder of Freedman Consulting, a law-practice consulting firm. She also serves as the Law Practice Management Coordinator for the Pennsylvania Bar Association where she assists members with management issues and decisions on the business side of their practice.
“If you can’t clearly say to a potential client or referral source why you are a better selection, then don’t expect to convince anyone to hire you,” warns Freedman. “You’ve got to say it and mean it, and if you can’t do that, you need to figure out what to do to make yourself the best choice.” - Become intensely client-focused, says Heidi Alexander, Esq. Alexander is Director and Law Practice Advisor for the Massachusetts Law Office Management Assistance Program and Deputy Director of Lawyers Concerned for Lawyers, a nonprofit lawyer assistance program.
“Small firms need to think about how to engage the client, focus on them and show them value,” she explains, “especially in the face of competition like DIY legal services.”
To achieve this, she advises that you: - Use technology that makes it easy to communicate with lawyers, and helps you provide them a better value by doing more in less time.
- Create roles that are devoted to client management and services, because it’s important to understand “what they are going through and how their needs are changing, as opposed to focusing on how you operate,” she explains.
If you want to be successful in 2018, it’s no longer possible to keep doing what you’re doing, especially if you’re operating like it’s 1998. Change is only accelerating and the longer you ignore it, the more challenging it will be to respond.