You hear it all the time: These days, law firms have to operate as businesses. Over the past quarter-century Big Law has been transformed from an inefficient guild into a robust free market for clients and talent. Efficiency, service, expertise and results increasingly drive profitability and success. Peer-group financial metric benchmarking is pervasive. Digitization and business-process expertise have created openings for e-discovery companies and legal-process outsourcers. Tweed suits, tobacco-filled pipe bowls, gold pocket watches and corner offices for senior partners are no longer the markers of success. Today, cash is king, and when cash is king, you know you are running a business.
But despite all of that change, could it be that Big Law is actually losing ground, operating less and less like today’s big businesses? The answer is a resounding “yes.” I’m not talking about the idea, already posited by many, that technology will make much of what Big Law does a commodity. There is certainly ample evidence of that. Instead, what I’m talking about is the failure of law firms to keep up with ongoing change in the very business model on which the world’s most successful companies are built. Big Law’s challenge now is whether it can survive and prosper in an era in which Big Data, and specifically, data analytics, is king.
