In my last blog post I tried to show the factors which increase complexity in the business model of law firms. Today’s blog post is about reducing complexity and casting the law firm strategy into an ideal mould.
The working processes of a law firm can be roughly divided into the service provision process, on the one hand, and the support processes, on the other hand. The service provision process describes the procedure which is necessary to provide the service owed to the client. In a rough outline, it could look something like this:
The support processes in a law firm are typically the following five:
In the following step, I would like to combine all these processes in a useful way to ensure that the law firm’s strategy is mapped as well as possible. At the same time, the complexity that results from the diversity of the working processes required for the operation of a law firm should be reduced. Let me explain this with the help of an example. Let’s assume that the law firm has opted for a strategy which focuses on the expertise of the practice groups. The dominant design criterion for the law firm’s process landscape is thus constituted by the services allocated to the practice groups. Now if in the matrix below, the service provision process (dark green) and the support processes (light green) are listed vertically and the practice groups horizontally, this will result in the following process model:
Thus the law firm in our example has decided to mould the subprocesses of “Lead generation”, “Clearing conflicts of interest”, “Accept mandate/lead conversion” and “Assign responsibility for mandate” in a central and standard manner for all four practice groups. The same applies to the subprocesses of “Know-how extraction” and “Close mandate”. However, the subprocesses of “Briefing by client”, “Work on mandate” and “Presentation of results” should be individually configured for each practice group and also be located there. “HR management” and “Knowledge management” are also individually organised for each practice group, while the support processes of “Marketing”, “Finances” and “Logistics/IT” are again organised centrally and in a standard way.
If the law firm’s strategy is based on client segmentation as the dominant design criterion for the process model, then the practice groups of the above graph must simply be replaced by the industry or sector groups, and sensible allocations must be found for the individual subprocesses. The same course of action is applicable if the law firm chooses the coverage of various jurisdictions (national organisation) or its distribution channels (stationary business, online business, secondments or client training) as the dominant design criterion.
Let me quote a second example. Here, the law firm aims at a process model which reflects its territorial presence in various locations.
How can this process model be read? The law firm leaves the organisation of the entire service provision process to the individual locations. The same applies to the “HR management” process, which should also be designed along individual and decentralised lines. Only “Finances”, “Knowledge management” and “Logistics/IT” are under central control. The law firm has opted for a compromise for “Marketing”: Zurich and Frankfurt join forces for the purposes of marketing, whereas London and Singapore each have their own marketing department. The aim must be to combine the processes and to organise them centrally – wherever this makes sense and is possible. Only where it is crucial should the processes be decentralised and tailored to the individual process users’ specific requirements. In this way, a process model is created which is optimally geared to the law firm’s strategy and the efficiency of the organisation at one and the same time. Let me explain to you in my next blog post how technology can be used for the support of the processes (and ultimately also of the strategy).
This blog was originally published on 2 April 2019 in Vista, the online magazine of the Executive School, University of St.Gallen, Switzerland.
About the Author Prof. Dr. Leo Staub is a Titular Professor of Business Law and Legal Management at the University of St. Gallen. He also is one of the Directors of the Executive School of Management, Technology and Law of St. Gallen University where he chairs the division “Law & Management”. Leo can be reached at leo.staub@unisg.ch