Whether it be from the influx of millennials into the workplace, the use of artificial intelligence, the rise of legal process outsourcers and alternative providers, or any of a host of fundamental changes, new market drivers have created a permanent change in the global legal market.
Lawyers who steadfastly remain resistant to that change risk being left behind.
Lawyers are known for being very intelligent, but as a group, they are also known for being famously risk-averse. Humankind as a species resists change. The economic distress of the past decade, constantly evolving technology, and an unparalleled workplace generational shift are transforming the practice of law. Those lawyers who steadfastly remain resistant to change risk being left behind.
A Permanently Changed Reality
Whether it be from the influx of millennials into the workplace, the use of artificial intelligence, the rise of legal process outsourcers and alternative providers, or any of a host of fundamental changes, new market drivers have created a permanent change in the global legal market since 2008. Lawyers have shown affinity for helping their clients adapt to the changing marketplace, providing advice to assist them in navigating major changes in the law and in the way the clients’ businesses operate. Yet many lawyers have struggled to make meaningful changes in their own business models. With change comes tremendous opportunity for law firms and corporate legal departments. With so much at stake, why aren’t more lawyers at the forefront of technology and innovation?
Looking Backward to Look Forward
Lawyers are trained to look first to precedent; why reinvent the wheel when the patent already exists?
Lawyers are trained from before their first day of law school that precedent should guide their decision making. From case law, to statutory interpretation, to how to structure a major corporate transaction, true innovation is often hard to come by because lawyers of days gone by have provided guidance to find a successful path to the answer. When looking for an answer to a question, most lawyers look to where they’ve been to determine where they need to go.
The state of legal education has shown little movement away from this type of training. Despite declining law school enrollment and more limited job prospects, course text books and the Socratic method remain the main tools of lawyer training in law schools. Technology and the business side of law are often overlooked. Law students receive in-depth instruction on the intricacies of the Erie doctrine and stare decisis, while business-related competencies lawyers need to be successful in this changing environment – such as data analysis, coding, statistics, or marketing – remain unmentioned.
The precedent-based nature of legal education underscores the nature of the practice of law, and may help explain why the legal profession draws people with certain traits or tendencies. A traditionally risk-averse profession may attract those who are more linear in their thinking and process-oriented. It may also appeal to people who like finding a solution that’s undoubtedly right.
It is worth noting that there are a handful of law schools that are beginning to rise to the challenge of integrating technology and innovation into the curriculum. Programs such as The Law Lab at Chicago-Kent College of Law; the CodeX Center at Stanford Law School; Legal RnD at Michigan State University; the Institute on Law Practice Technology & Innovation at Suffolk University Law School; and the Program in Legal Technologies at Georgetown University Law School are some of the leading programs that are combining the traditional legal curriculum with interdisciplinary programming on technology and business practices. However, those programs are still the exception rather than the rule in legal education.
Why So Resistant?
Psychology may offer insight into why lawyers are so resistant to change: Many may have a fixed mind-set, instead of a growth mind-set.
According to psychologist Dr. Carol Dweck, a professor of psychology at Stanford University, people with a fixed mind-set work toward “performance goals.” They tend to focus on looking smart even if there’s no learning in the process. As she explained in Stanford Magazine, “For them, each task is a challenge to their self-image, and each setback becomes a personal threat. So, they pursue only activities at which they’re sure to shine – and avoid the sorts of experiences necessary to grow and flourish in any endeavor.”
It is not a far leap then, to see how this mind-set can foster a fear of failure. This creates a reluctance to venture beyond one’s comfort zone. For lawyers, this mind-set has been continuously reinforced throughout their education, from a school system that praised intelligence and discouraged risk-taking, to training once in practice that encouraged using prior work product to ensure work was produced in conformity with best practices.
If tech start-ups represent one end of the culture spectrum, characterized by a “fail fast, learn faster” environment, the practice of law is on the opposite end, with lawyers unwilling to experiment with different ways to find the right answer.
But as with nearly every rule, there are exceptions. In the legal marketplace, such an exception may be in Silicon Valley, where “fail fast, learn faster” looms large. In this region known for innovation, legal department operations teams are finding new ways for lawyers – both in-house and the law firms they hire – to function more efficiently. Legal department operations professionals – proxies for innovation – are often then charged with deploying the innovation.
A Shift in Mind-Set
Legal department ops professionals may be among the best examples in the legal profession of individuals with a growth mind-set – the belief that personality traits are malleable. This attitude stands in contrast to the previously mentioned fixed mind-set, which holds that personality traits don’t change. Dweck explained, “People with learning goals have a growth mind-set about intelligence, believing it can be developed.” With a growth mind-set, an individual views learning as a lifelong endeavor. Taking risks and even failing are simply part of the journey. Development is iterative.
Applying this approach to the practice of law can help lawyers manage organizational change and handle setbacks. Harvard Business Review noted, “People with growth mind-sets (incremental theorists) see outcomes not as evidence of who they are but as evidence of what they could improve upon in the future and what challenges they could overcome.”
Legal matter pricing provides a good example of how an iterative, growth mind-set can lead to better results. Consider an in-house team and law firm management that utilized an alternative fee arrangement that didn’t perform as intended. Under a fixed mind-set, this would be viewed as a failure, and could discourage any future use of AFAs because “we tried that and it didn’t work.”
In contrast, with a growth mind-set, the team could tackle it as simply a setback to overcome. They could revisit how to price their work, using coding or historical data-driven processes to improve their fee arrangements for future projects. They could reexamine how they determined the scope of the matter that went awry to determine how to better scope such matters in the future. In short, they could use the experience as an opportunity to refine and strengthen their relationship, rather than treating it as a reason to abandon AFAs.
The pace of change in the legal market shows no signs of slowing. The rapid pace of change dramatically impacts a lawyer’s SWOT (strength, weakness, opportunity, threats) analysis. A lawyer with a fixed mind-set will tend to see lots of weakness and threats. Legal professionals who become more growth-minded will, instead, tend to see much more opportunity, and their resilience will better position them to help themselves, and ultimately, their business partners.
Advantage: Growth Mind-Set
While a growth mind-set can help legal professionals manage change in the workplace and achieve success in several ways, the biggest benefit may be that ability to iterate to create new, innovative models of client service delivery. This can include being first to adapt to new market drivers, whether AFAs, technology, or the use of alternative legal service providers. It has long been recognized that “first movers” enjoy an advantage in a competitive marketplace because they are seen as leaders.
Additionally, when corporate counsel and law firm management get out of their comfort zones and experiment with different ways to find solutions, they reinforce their team’s commitment to their business partners. Innovative service delivery models offer solutions that no other service provider can match. This helps create demand, and in turn, fosters loyalty.
Too many lawyers operate under the motto, “If it isn’t broken, don’t fix it.” Just because a business model worked in the past does not mean it will continue to fare well. There is no such thing as status quo where nothing is static to begin with. Avoid being blindsided by acknowledging the changes in the legal space, and being aware of how developing trends impact business partners. Embrace a growth mindset to create an environment where new solutions can be developed as new challenges arise, without the fear that innovative and new must be more risky than tried and true.
Culled from Thomson Reuters
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