Developing Your Law Firm : Upcoming Trends to Look Out for
With changing times, industry practices have undergone an extensive evolution and development due to globalization. The same applies to the legal market. Assisting your clients by providing proficient and superior services is just a bare minimum to improve your current position.
However, law firms need to do much more to achieve consistent growth, especially in today's testing time due to the ongoing pandemic. But, what steps must be taken in order to create a winning law firm? Professionals graduating from law schools and programs may be equipped with sound legal knowledge; however, how to develop a law firm may not be in the curriculum of most of them.
Whether you aim to expand your solo practice or make your firm larger, it is vital to know the fundamentals of business development by heart. And the only consistent fundamental trait of businesses and business development is evolution. This makes it necessary that firm owners keep themselves updated with the ongoing market trends and prepare for the future.
Key trends that will impact the workings of the legal sector in the upcoming years.
The Pandemic's Impact on Various Industries
The pandemic has brought harsh but mixed changes to the industries. While some sectors are witnessing new heights, others are on the verge of disappearing into oblivion. Hospitality, Textiles, entertainment, tourism, and education sectors are not what they used to be. The near future impacts can also be varied, making it essential that practitioners carefully observe the situation of industries their clients belong to assist them with complete efficiency.
Dependence on External Support
Running a law firm doesn’t mean you spend your entire day getting motions passed and raising appeals. Many other back-end legal tasks require precise attention, like document review. But these tasks can be time-consuming and hectic. Major firms are increasingly outsourcing their back-end legal work to companies that provide legal process management solutions.
As per researchers, the global legal process outsourcing market will reach $35.9 billion by 2025.
By taking experts' assistance with some jobs, firms can attain flexibility. Seeking outside legal process solutions can free up a large chunk of attorneys’ time, enabling them to concentrate on other essential tasks.
Market Reaction to Present Situation and Policies
There was a lot of action in the capital markets during 2020. A significant reason for this was the reactive trait of the capital markets and the Federal Reserve's policies. However, it is impossible to say what will happen if those policies are amended.
There are so many unpredictable factors swirling around like a tornado which can make it difficult for attorneys and firms to plan their business ahead. Therefore, you should take cautious and research-oriented steps to ensure your business development strategies have positive effects.
The world is lost in the storm of uncertainties at the moment, and it will take some time for the dust to settle and things become more transparent. Thus, you should consider keeping yourself updated and adjust your sail accordingly.
Working Remotely/from Home
Covid-19 has made it relevant for people to work from home. But this trend may stay relevant or even grow after the pandemic is over as many companies are letting their employees work remotely.
Before the lockdown, your team was available in the office, and you could collaborate with them quickly, but that is not the case anymore. That's because most of them are working from home or other locations.
So, firms must co-op with these changes and come up with a suitable business strategy.
Researching Internal and External Factors
It will help if you prioritize research on the market, competition, and potential clients. You should assess how much of your finances are being affected due to the ongoing situation. Depending on the impact, you can decide whether there is a need for staffing, provide different services and decide if it makes sense to enter other industries. Previous years' finances should also be analyzed to understand which sectors and clients can benefit the most.
Another important thing to consider is that firms can only assist their clients if they understand their needs. The best way is to reach out to your clients and discuss how the ongoing situation is affecting their business and what trends they foresee in the future. Ask them in what ways you can help them or how you can improve your services? In addition to that, don’t forget to stay updated with the analysts' predictions about your clients and their sector. Company and CEO fillings, press releases, and investors’ summits are also effective ways to gain an enclosure about clients and their industries.
Also, make sure to keep up with strategies that other competitive firms are implementing. How are they presenting themselves? Do they lack in an area that you can leverage? Again, you must critically research your competitors one by one and list opportunities and threats.
The Arrival of Virtual Litigation
The lockdown resulted in the closing down of the courts for a significant duration of 2020. Still, no one can predict when the courts will open for in-house hearings. Depositions, appeals, motions, and even trials are being conducted via online medium. What changes can this lead to in the future? Will the number of billable hours change due to this? There are many questions like these law firms need to focus on.
Amidst the outbreak last year, law firms and even other companies have witnessed increased saved expenses as travel and entertainment reduced. Although professionals may agree that virtual meetings do not offer the appropriate environment to build a genuine relationship with clients, will they take more severe precautions to analyze which conferences and travel activities made a positive financial impact? And is it valid to say this analysis will affect the business development budget of lawyers, especially those who attend in-house conferences? Would they be able to bring more business if their budget gets reduced? And does it make sense to participate in virtual conferences and learning programs once everything is back to normal?
It can be advantageous for law firms to figure out the solution to these questions on a financial and growth level.
Cross-Selling is Re-Trending
Cross-selling is often misunderstood as an easy task by firms and attorneys. In reality, there can be many obstructions to effective cross-selling like culture, compensation system, and egos. These barriers must be destroyed to create a more collaborative selling environment and accomplish benefits. An existing client is your best lead for cross-selling as you already are outside counsel lists, and there is trust and understanding between both of you. But make sure you determine which the right client is and what their needs are before cross-selling them.
Flexible Billing Mechanism
The pandemic has significantly impacted the revenue generation of industries. Aside from workforce and budget problems, firms face trouble as their clients' income has decreased. This will directly affect their billing capacity.
To counter that, firms should develop creative fee structures and maintain an inventory of fee arrangements to create flexibility and easiness for their clients. This will lead to more trust and help you retain your client for a long time.
Customizing your firm to adapt to the ongoing situation can be challenging, given the factors at play. Still, the ability to manage challenges is required if you want to grow your law firm. Skills like understanding your clients’ business, fulfilling commitments and assisting with practical solutions, and building relationships are the fundamental elements to succeed when the conditions are normal. But combining these skills with patience and openness to new technologies, your firm can observe immense growth even in today’s disquieted environment.