Clients Are Watching Your Every Move!

Hoooo doggie! There’s a tussle afoot in the legal industry, aint there? A big ol’ wrangle underway with the legal equivalent of fist fights in the saloon (aka: lots of words being tossed around via briefs and press releases).

When Cravath, Swaine & Moore LLP decided to raise its starting associate salaries to $180,000, an increase of 12.5%, you’d think that they just told their clients that their fees were going up 12.5%. Large companies that employ in-house counsels and also contract work out to private firms went banana-boats.

Of course, clients are worried that these new salaries will represent a fee hike for them, forcing them to carry the burden of a law firm’s business decision. The moral of this lesson? Clients are watching everything you do and they are demanding high value for the fees they pay. And, if I may say so myself: I TOLD YOU SO!

But before I gloat too much, let me share a bit more of this recent brouhaha.

I read the following in the Wall Street Journal:

Allstate Corp.’s general counsel, Susan Lees, dashed off a note Tuesday to an undisclosed number of law firm lawyers challenging the logic of paying first-year associates $180,000.

“[O]ne must question the merits of a business model that compensates fresh law school graduates, who are devoid of any meaningful lawyering experience, with a salary greater than that of a seasoned in-house corporate attorney with a decade or more of experience counseling senior leaders in our organization,” states Ms. Lees’s letter, which was reviewed by Law Blog.

But that’s not even my favorite part. Here it comes (my favorite stuff is bolded and underlined):

She then reminds law firms of the recent past: “We must remain mindful that, just a few short years ago, when our country was enduring one of the most significant economic downturns in history, some law firms were forced to slash expenses to survive … But these were largely reactive measures, rather than long-term strategies to drive sustainable and meaningful change. There is no better time than now to adopt a better approach.”

Ms. Lees ends by reminding the law firms that clients like herself, “are fortunate to enjoy a robust legal marketplace in which competition prevails” and can reward those who innovate. “I encourage your firm to demonstrate prudence when considering the business decisions of firms such as Cravath,” she says. “To do otherwise is to ignore the realities of the marketplace and forego an opportunity to lead.”

Drumroll please: Let’s recall the savvy words I wrote just a few years ago?

“The economic crash of 2008 forever changed the way law firms conduct business. Once-powerful firms that held all the aces were forced to take a hard look at their operations, seeking more efficient, cost-effective ways to get their work done. On the other hand, their customers, who went through economic hardships of their own, became more cost conscious than ever and they have become savvy enough to ask challenging questions of the people who used to have all the power.

There is a seismic shift underway in the legal industry and it all comes down to efficiency. It is not enough for a firm to offer their clients the best legal minds. Today, firms must possess both legal and technical expertise. Simply put, the firms that will succeed must know how to effectively leverage technology to efficiently help clients achieve their goals.

Using technology to drive efficiency in law firms could be the #1 innovation underway right now. Through efficiency, you deliver more “bang for the client’s buck” and you also increase your profitability. (Then you could cover those salary hikes yourself without passing it on to clients who will likely look elsewhere for legal advice.)

If you are AT ALL curious about how your firm might be an innovator and leader, driving efficiency to achieve goals and increase profitability, call me today. I’ve been noodling this stuff for years, and I used to serve as COO of a mid-size law firm. I know this stuff inside and out, and I’d love to help you take the next step.

Interested in learning more? 303-800-5408 or


Savvy Training & Consulting works with leading companies and technologies to deliver the most up-to-date training solutions and curricula to law firms. Savvy recently unveiled an award-winning Learning Management System (LMS) for law firms, SavvyAcademyTM, which delivers scalable training capabilities, reportable data down to the individual user and 24/7 support, all for a fraction of the cost of traditional LMS services.


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