What can lawyers learn from Big 4 companies
I gained my professional experience mostly in „Big 4”, and more precisely- in Deloitte. For 6 years, I worked in Tax&Legal marketing, and for the last 2 years I managed the marketing and PR team, creating the Business Development team from the ground up. Leaving Deloitte over five years ago, I thought (quite naively) that the level of knowledge on marketing, sales and innovation within the professional services branch is comparable to the awareness within Big 4.
A few months previously, I was invited by Jacek Santorski to be a guest of Sunday meetups hosted by the Leadership Psychology Academy, in a panel on failures. Dr Małgorzata Bonikowska coined the term „hybrid success”, which appealed to me quite a lot. In the last 5 years, the business landscape in Poland has undergone significant changes, and the tax and legal market has changed drastically. My perspective over the last few years has allowed me to see what was my failure, or rather a „hybrid success”, and why for some things it was simply too early. I also clearly see what lawyers can learn from Big 4 consultants.
The trend of building law departments or law firms by leading tax and audit companies is not only visible in Poland, but the world in general. Undeniably, much depends on internal regulations in each country, but in Poland, each one of the leading taxes and legal companies have their own legal firms. Some time ago, law firms within consulting companies provided services for clients of other business lines. However, in recent years the trend has changed-law firms within consulting are becoming more independent and compete with both network and local legal firms.
„Big 4 is no competition for me”
Many lawyers perceive the Big 4 only as tax and auditory services. But according to a Thomson Reuters report, „Alternative Legal Service Providers 2019” 20% of large legal companies stated that they competed with a such a firm in the last year, whereas 23% stated that they lost clients to them. The advantage of consulting firms is visible on many levels. Strong ties to corporate directors, investing in technology, the ability to integrate legal matters with other services, a good reputation along with high quality of services pose a strong threat for large legal firms.
The four advantages of Big 4 over other legal firms are:
Acting through a network, giving a larger coverage of the market
Integrating legal services with other: i.e. tax and accounting services
Legal services in many jurisdictions (although not all legal specialties can be covered)
Hiring top lawyer talent and the possibility of changing career paths within other business lines
The most aware and open- minded managing partners see that strong rivalry forces legal firms to change their approach in order to retain clients. How can this be done?
Centralised and de-centralised models
Undoubtedly, legal firms should not blindly follow the actions of consulting firms. A few years ago, Big 4 companies opened many regional offices to be closer to clients, Is this a good strategy for law firms? Not quite. This may be a good fit for tax advisory and audit, as these operate mainly outside of Warsaw, but it is important to keep in mind that there is a large brand and big money within these companies. In the case of legal firms, and Polish (even large) firms, this may turn out to be a very costly solution. A better way to leverage market competition is to develop „back-office” structures in regard to legal services, as well as administrative support.
And what if team management and recruitment isn’t a priority?
The legal and advisory business usually competes for the same group of candidates. They are young, well-educated, know several languages and often after studying abroad. Within this group, there are often people who are graduates of law and economic studies as well. Glancing at the number of career paths within consulting, law firms are posed to be a lost cause. In large consulting businesses, the career path is most often visibly outlined, at least in theory. Unfortunately, in the case of legal firms, HR is often limited to „payroll” functions, and recruitment is done by partners. This results in a lack of recruitment strategy and loss of top talent.
Diversity, or its lack in legal firms
Unfortunately, not many legal firms see the benefits of differing roles at the mid-level, or even hiring people who are not lawyers, for example in areas related to technology development, process management, HR, or marketing. I keep saying over and over: a legal firm is just like any other firm on the market. Lawyers should strive to professionalize both the business model, as well as support functions. It is a particular dream of mine to see functions such as Chief Technology Officer or Chief Innovation Officer in legal firms, and for directors of marketing and HR to be seen as even partners to design and execute the law firms’ strategy.
Marketing and innovation
Many legal firms have a stiff and hierarchic structure, which is a barrier for development and attracting talents that could bring new skills to the table- i.e. within innovation. Consulting firms are a step further in this race- right under the nose of legal firms, who are still convinced that consulting is not able to rival with them for clients.
This way of thinking has lulled lawyers into a false sense of security and caused them to miss the moment where consulting firms started to position themselves as a partner, innovator, and trusted advisor.
Consulting firms have been aware for quite some time how important is branding and marketing within professional services. Lawyers are just beginning to comprehend this. Many lawyers are sceptical and unkeen to support innovation, as it carries risks. Many lawyers associate scepticism and caution with high quality, but it is precisely scepticism that kills innovation and is a barrier in being a leader that leads and develops employees. Lawyers with such an approach become reluctant towards risk and focus on protecting the client. This is one of the reasons why they are often considered to be the brakeman in companies.
Crouching tiger, hidden dragon
The legal profession is changing. Lawyers are under constant pressure from clients, the competition, alternative providers of legal services and millennials entering the job market. The fine line between consulting and legal services is becoming bleaker, and Big 4 companies pose a larger threat to legal firms. Many partners in legal firms do not see the threat, but this may change, and change quickly. It is worth taking a look at activities within Big 4 and applying them within your legal firm.
About the Author:
Kamila Kurkowska, CEO of Firemind, President and Founder of Women in Law Foundation, Ambassador of European Legaltech Association in Poland.
Kamila is experienced and innovative business manager, focused on legal marketing, Legaltech and corporate innovation. She have gained her knowledge and experience leading marketing and business development teams at Deloitte Tax and Legal Advisory and Harvard Business Review. Since 2015 she has been successfully running Firemind - consulting company, specialized in strategic and marketing advisory to professional services and technology companies. She advices Clients on digital and offline marketing, business development strategy and ongoing projects, serving as Head of Marketing on a number of occasions. Thanks to years of effective management of large and complex teams, combined with effective building of relationships with different groups of stakeholders, business partners and clients, she has been able to build a broad and strong business network.