Navigating the changing legal industry as an independent lawyer
Over the past decade or so, the legal industry has evolved to better meet clients’ needs. As an independent lawyer, the changing legal industry affords you a number of opportunities.
What has changed?
Alternatives to traditional law
Technology and innovation have converged in recent years, which translates into more options for those seeking legal services. At one time, traditional law firms provided the only option. Now, consumers can find basic legal information and forms through various sources online. They can also hire non-lawyers for simple legal tasks.
In short, buyers of legal services have more choices than ever before; from DIY options to non-traditional firms.
One expert, writing for Forbes, points out that lawyers no longer dominate the entire marketplace when it comes to legal services. He adds:
“Law has become a three-legged stool supported by legal, technological and business expertise. To date, no single provider has successfully integrated the three ingredients on a scalable basis.”
He points to a few collaborations in the works that could successfully combine all three. The new approaches to delivering legal services will eventually disrupt the traditional law firm model, but he says those changes are progressing slowly.
A new approach to billing
More law firms are opting to simplify billing for clients, and clients have demanded that change. Buyers have pushed for more value for their money in law, which means traditional billable hours don’t cut it.
According to a Balance Careers article on the changing legal industry:
“Pressure to reign in legal costs has forced law firms to diverge from the traditional billable-hours model–a century-old staple of the legal industry that has been criticized for rewarding inefficiency–in favor of new alternative billing models such as fixed, flat, blended or capped fees.”
Some businesses have solved the billing problem by hiring more in-house counsel and contracting less often with outside firms. Law firms, in turn, have started using non-traditional billing models with more efficiency and transparency built in.
A report from Thomson Reuters echos that idea:
“Clients are demanding more value for their legal spend reflecting the change in legal services from a seller’s market to a buyer’s market. And the market of non-law firm competitors such as the Big Four and other providers continues to grow at double-digit rates to more than $10 billion in annual revenues…”
As an independent practitioner, you have the ability to structure your law firm with efficiency and client needs in mind. Know your target clients well, and create a billing and delivery model that best meets their needs.
A move away from general practice
More experts are pointing to general practice law firms as having a short shelf life. These firms try to offer a variety of services to meet the diverse needs of their client base, but that’s not what the market wants.
According to BCG Search:
“Those firms clearly doomed to extinction are the ‘general-practice’ or ‘full-service’ midsized firms. Whether your firm, like the dinosaurs, is headed for the tar pits or not is a function of the size of your target market segments, defined in terms of geography, demography, or industrial classification.”
With more options available for basic legal services, and more demand for value and lower fees, general practice no longer makes sense for most law consumers. What buyers need more often is a lawyer who specializes in a particular area and who can offer unique insight and skills in that area.
In addition, many law clients need a a law firm that can offer flexible or contract arrangements as needed. If you can collaborate and contract with other independents, or in-house counsel, all the better.
Your ability to remain nimble as an independent lawyer, or a small law firm, can help you react more quickly to changing client needs. That flexibility sets you apart from the big, traditional law firms that change at a much slower pace. You are in a position to stay ahead of the curve.
To learn more about growing an independent law practice in Denver, contact us. We offer lawyer coworking and office space at three central locations.