Challenges of change and how to develop and implement a strategy in a law firm

 

Rupert Egerton-Smith is Head of Strategy & Business Transformation at Linklaters, one of the most prestigious global law firms. The firm is a member of the illustrious “Magic Circle”, widely recognized as the group of “high-end” competitors in the international market for legal services. Rupert’s background is in management consulting. He worked at PA Consulting before joining Linklaters in 2000. Rupert leads a function which provides strategic and analytical support for decision-making, working with the firm’s senior management team. He and his team also help the firm to create efficiencies and work with the partnership in the implementation of the strategy. Rupert combines his business career with his passion for the piano; he even won the first prize and audience award at the 20th International Concours des Grands Amateurs in Paris in 2009. Rupert was interviewed by Leo Staub.

 

Rupert, Linklaters is well known for its systematic way of developing and implementing strategic decisions. Strategy always means change. Do you not find it difficult to motivate some 500 extremely successful partners to keep on moving when things seem to be going perfectly well?

 

It is key that the partnership feels ownership for the strategy and this is crucial for effective implementation. Whereas in a corporate the management can be more directive, in a partnership it is key that there is consensus so that individual partners take ownership for the strategy. In our experience, it does not work to impose strategic changes top-down, out of the “centre” of the firm. Therefore, we need to create an environment where strategic impulses can be more bottom-up. With 500 partners, this is complex and we need to strike a balance between challenging thinking being generated within the centre of the firm as a “trigger” but full engagement of the wider partnership in debating and testing these perspectives. By achieving a balance between top-down and bottom-up we are able to align around a shared direction. This may be slower than in a corporate environment but when it comes to commitment and implementation this method proves to be successful in a partnership.

 

Could you elaborate a bit more on your strategy development process?

 

In reality we are testing our strategy on a regular basis, for example with the strategy team identifying and highlighting external trends to which we should be adjusting and then making tactical changes. However, every few years, we work with the partnership to review our strategy on a more formal basis. This starts with discussions in the senior management team which are informed by a detailed review of the market and then we broaden the circle to gather input from other partner teams across the world. We have discussion groups in offices and practices around a small number of key strategic questions and we review the responses and consider their impact. We have a full partners’ meeting annually which provides an opportunity as a combined partnership to consider the most important strategic issues which may lead to a shift in direction. Our annual business planning cycle immediately follows the partner meeting and is the link between this strategy and the implementation at the local level.

 

You have touched the issue of implementing the strategy once the decision is made. It is easy to draw up an impressive looking strategy paper. Difficulties usually arise when everybody’s commitment to change is asked for. How do you manage this?

 

You are right that the execution of the strategy is definitely the more difficult piece. The first thing is to find a way to communicate the strategy clearly and simply right across the organisation. We need to show a clear link with the long term vision of the firm and break down the strategy into a small number of priorities, reinforcing communication along these lines. For any programme of change to be successful, it is vital that the business units are taking action on the key priorities. The “centre” of the firm can create the conditions for the implementation to be successful, through clear leadership and by ensuring consistency of communication and a link between the measures of success of the strategy and the firm as a whole. In reality though, each partner needs to take action. It is also important to have the right partner sponsors on certain projects or initiatives and for influential partners to be seen to be leading these.

 

You and your team are not only supportive of the firm in all aspects of strategy development. You also provide means of improving the efficiency in everyday work. How is this done?

 

This is another responsibility of my area. We are seeing increasing pressure from clients on fees and a desire for the legal work to be delivered more efficiently in some areas. This pressure has gone hand in hand with increased visibility among internal legal teams of the true cost of certain more routine legal tasks – the development of LPOs has also enabled this. The task of the Business Improvement team is to help lawyers to deliver the legal work more efficiently. This involves training in project management, developing a full range of alternative sourcing options for the legal work and exploiting technology where it can help us automate certain types of works. Leadership from the top of the firm on these issues is very important.

 

Maybe cultural problems will emerge when highly sophisticated experts are asked to cooperate with people doing routine legal work in the same firm?

 

Many firms experience resistance to change in this area. In our view, this is not a case of saying that a certain legal product area is now a commodity, but showing that there are commodity components of a really sophisticated and complex deal which can be done in a different way which makes better use of our resources and responds to client demand. If the issue is positioned in this way, partners are more receptive. The pace of evolution is accelerating. A few years ago, many lawyers would not have felt comfortable with the description of their work as a “process”. In reality, there is now increasing convergence between technical legal delivery, project management, process thinking and technology. Many of our practice areas have embraced this thinking for some time.

 

When looking at future trends in the market for legal services, what are your main concerns?

 

First, I am confident that there will always be a substantial need for excellence in complex legal problems. That is why firms like Linklaters will still be there whatever the future may bring. The main threat I see for premium law firms is of being complacent and of not being able to transform fast enough when things really start changing. That is why my team’s role is increasingly important. We need to constantly challenge what we are doing and help the firm to adapt to important changes in the market always ensuring partners are leading on the change so it is really embedded.

 

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