Don’t confuse legal project management with legal process improvement

In Change Harbour’s recent survey of law firm’s key decision-makers, 91% of respondents reported price pressure in some or all areas of their business, while 79% of respondents said that they are experiencing increased demand for alternative fee arrangements with these typically including fixed fees or capped rates. It is clear that it’s no longer sustainable for law firms to have an open clock running on legal work for clients.

Law firms are responding to these changing conditions by developing and implementing a number of strategies. Amongst these include cost reduction, process efficiency, merger activity, new product development and deeper, more strategic client relationships.

This environment creates the commercial drivers for legal project management (LPM). So why is LPM still a relatively immature ‘industry’? In simple terms, legal project management is the application of project management techniques to the execution of legal matters. However, I often find that industry commentators are confused between project management and process improvement. This confusion subsequently leads to the mis-understanding that legal project management is synonymous with the commoditisation of legal services.

Given this confusion, let’s clarify – what is a project? A project:

  • Is time-bound and has a customer
  • Is a complex effort with inter-related tasks
  • Has a non-repetitive undertaking
  • Has specific objectives
  • Has time and cost constraints
  • Needs a temporary organisation of diverse resources
  • Has clear beginning and end states
  • Is a specific cycle of initiation, definition, planning, execution and close

This sounds like the perfect description of a legal matter at the most complex end of the spectrum…the sort of transaction for which clients are increasingly demanding greater value, transparency and increased certainty. So given the complex and often unique nature of legal transactions, project management should be at the heart of effective delivery.

Specifically, project management methodologies have been invented to manage the three main issues clients of projects and legal matters often complain about:

  • Timeframes overrun
  • Costs overrun
  • Failure to meet client expectations

So if project management is critical to the effective delivery of legal matters, where does process improvement come in? If we define a process as:

  • On-going with no clearly defined beginning and end states
  • Customer driven
  • Repeatable

We should also understand that even the most complex matters will have process driven commoditised elements – e.g. due diligence, document review. Process optimisation should be applied to the efficient delivery of these commoditised elements of a project, while classic project management becomes increasingly relevant and valuable as the legal matter becomes more complex.

Applying project management techniques allows the law firm to gain a deeper understanding of the composition of a matter. This in turn allows the law firm to disaggregate the transaction and apply the most appropriate solution to each component. This may be a specific sourcing or process based solution involving subject matter experts, legal process outsourcing (LPO), information technology, and so on. You might be managing your projects perfectly, but what about the processes underneath?  Project managing an inefficient process isn’t ideal. So while the skill of the project/matter manager is:

  • To configure the matter appropriately
  • Ensure that each element is planned and sourced appropriately
  • Run and coordinate the disaggregated elements of the matter concurrently

It’s also critical that the law firm understands which elements of the legal transactions can be and should be managed as process and potentially subject to disaggregation, sourcing and continuous improvement.

First posted by Simon Thompson here:

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Optimising Business Process

I have attached a link to the second of our series of four articles published in managing partner magazine exploring the issues of using sourcing strategies in law firms to boost performance

This article addresses strategies and approaches for understanding and optimising business processes within the backoffice and service areas of law firms.

To read the article, first published in the April edition of Managing Partner Magazine click here:  Business process optimisation

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Prize Fight

I have attached a link to the first of a series of four articles that we have published in managing partner magazine exploring the issues of using sourcing strategies in law firms to boost performance

This article addresses sourcing of processes and, in particular, discusses the degree to which legal service outsourcing (LSO) firms are becoming serious competitors to law firms …. and what law firms can do to enhance their competitiveness.

To read the article, first published in the March edition of Managing Partner Magazine click here  March Managing Partner Article – Prize Fight

The Surprising Science of Motivation

Here is a video from the excellent TED series where Dan Pink talks about the science of motivation and illustrates a mismatch between what science has proved and how management theory is applied in the business environment.

Dan Pink on the surprising science of motivation.

During the lecture he argues that in highly creative, knowledge intensive arenas, such as law, traditional carrot and stick motivators will work in only a surprisingly narrow band of circumstances and indeed tend to inhibit creativity.    He stresses that “too many organizations are making their decisions, their policies about talent and people, based on assumptions that are outdated, unexamined, and rooted more in folklore than in science. And if we really want to get out of this economic mess, and if we really want high performance on those definitional tasks of the 21st century, the solution is not to do more of the wrong things. To entice people with a sweeter carrot, or threaten them with a sharper stick. We need a whole new approach.”

Instead he cites examples where high performance is actually driven by giving skilled workers:

  • Autonomy – a sense of control over what they do,
  • Mastery – a desire and ability to improve and develop and,
  • A Sense of purpose – an understanding of where their efforts fit into an overall vision and strategy.

This speech, delivered in 2009,  presents an interesting challenge to our traditional thinking of how we engage, motivate and retain high performing individuals and is especially relevant to the legal industry where talent and the innovative application of that talent will continue to be a key differentiator


The Age of the Client

Josh Bernhoff of Forrester has written a very interesting article entitled ‘Welcome to the Age of the Customer. Invest accordingly.’

In this he states that “Disruption is rampant, it’s hitting every single industry, caused by customers with powerful technology on their side. The question is not whether your industry will be disrupted. The question is when.”

Forresters argument is that as customers gain access to more real time information about pricing, product features and competitors they become more empowered and in effect hold all the advantages. Forresters conclusion therefore is that we are now entering the age of the customer where “The only sustainable source of competitive advantage, the only defensible position, is to concentrate on knowledge of and engagement with customers”

Forrester curve

With this in mind, organisations that will thrive will be those that display the following characteristics:

A customer obsessed company focuses its strategy, its energy, and its budget on processes that enhance knowledge of an engagement with customers, and prioritizes these over maintaining traditional competitive barriers.

This hypothesis can be applied to the legal industry – a market that is experiencing structural change and an environment that will not return to pre-recession conditions:

  • Client expectations about the way legal services should be delivered and managed have matured and will continue to do so
  • New entrants to the legal market will be able to offer legal services in new, more efficient ways without the legacy and baggage of the accepted norms
  • New sources of investment will be available to legal service providers but will demand the effective and efficient management of operations
  • Technology will continue to accelerate the ability of consumers and suppliers to make more informed decisions, react to changing conditions more rapidly, share information and collaborate more closely.

The reality is that the traditional areas that law firms would emphasise to their clients – technical expertise, international capability, specialist knowledge and so on may no longer be enough on their own to differentiate themselves from their competitors and that traditional approaches and methods of serving clients is not sustainable. In the long term the law firm that is internally focussed, has rigid practice structures and focuses on a purely technical product will have a very small market to operate in.

Those firms that will develop in the new environment will:

  • Orientate their operations around the clients they serve
  • Have the agility to adapt and develop to support deeper relationships with their clients in real time
  • Be able to tailor their products and services to meet specific need
  • Have the flexibility to manage and deliver legal services and advice from multiple sources

No firm will claim not to orientate themselves around their clients but saying it is not the same as doing it.

It will be those firms that recognise that deep client engagement is the only path that will make corporate-wide shifts in thinking and behaviour.

The firms that master this will thrive in a world of constant disruption, because their clients know and trust them, and they make investments in those customers. Those that keep riding their current model and attempt to lock in customers will plateau and eventually wither.