As a nation of laws, the U.S. has always depended on its lawyers. But today the legal industry is perhaps more important than ever before to a country with the world’s largest gross domestic product, most patent filings, most new business start-ups, and the most watched, emulated, and successful of economies. The global nature of business involves legal issues ranging from intellectual property, patents, and trademarks, to venture capital, mergers and acquisitions, energy, the environment, and international law.
To meet this challenge, the legal industry itself is changing:
More Large, global firms – a growth in the number of large law firms as international corporate clients require more legal services
More Collaboration – the essential method of knowledge work today, collaboration, is central to more legal processes and work spaces
New Pressures – trends affecting every business, from the rising cost of real estate to the growing diversity of workers, are also affecting law firms, their work processes and environments
Digital Technology – the legal process still includes towering mounds of papers, but firms are increasingly adopting digital tools
Changing Priorities – lawyers today seek a better work/life balance, so law firms are offering new positions and incentives to attract and retain talent
These changes hit home in the law office. New ways of working require new approaches to the design and planning of law space, so Steelcase took an extensive look at the legal industry, conducted primary research and developed new strategies for legal workspaces. This paper offers an overview of the research, examines the work processes and behaviors of the legal industry, and offers new workplace strategies to help law firms adapt to a changing business world.
LAWYERS AT WORK
The majority of the nation’s nearly 1.2 million lawyers work in private practice, many as solo practitioners or in small firms with fewer than a half-dozen lawyers. Others work in the growing number of “super size” firms with hundreds of lawyers and offices located around the world, providing expertise and services to multinational clients. In fact, the number of firms staffed with more than 100 lawyers doubled between 1980 and 2000, and just since the mid-90s, at least one-third of attorney positions have been with these largest firms. As of 2008, 43.2% of all law firm jobs were with firms of more than a hundred lawyers.1
The super-sizing of law firms is the result of a global economy that has produced large, often international companies who require a diverse range of legal services. These clients desire law firms that can handle all their legal needs, so law firms are getting bigger and adding expertise their clients demand, often through practice consolidations. Large law firms are growing by hiring more specialists, and many regional firms are finding that they too must expand to keep up with customer requirements. Mergers among midsize law firms also have increased.2
Larger firms (colloquially called “biglaw” or “megafirms”) tend to include lawyers with expertise in specialized areas such as intellectual property, mergers and acquisitions, etc. These firms organize in traditional functional groups, or in teams that handle large, complicated issues for their client companies. As a result, traditional one-on-one attorney/client meetings have been replaced by collaborative group meetings of client and legal teams. Standards programs have changed, too. Private offices are typically smaller, and rarely are customized for individuals. Shared offices have increased in number, and many enclosed offices have been designed as multifunctional spaces that can function as either private offices or meeting spaces.
How firms use space has changed, as many law firms have become less hierarchical and younger attorneys have entered the industry. Private offices are still prominent features of law firms, of course, but they are used less frequently as performance rewards. Shifting generational attitudes are one reason; turnover is another. Traditionally, lawyers joined firms as associates and worked to become one of the joint owners and directors of the firm, or partners. It’s increasingly common now for associates to join a firm to gain experience and a healthy salary with no thought of achieving partnership status then move on after a few years. In fact, 78% of associates leave law firms by their fifth year.3 To retain top performers, some firms offer non-equity partnerships with titles such as “of counsel” or “special counsel.” Many firms have introduced other incentives such as mentoring programs, work-life balance initiatives, and flexible hours.
All private practice lawyers, on the partner track or not, are driven by the same need to generate billable hours, just like architects, designers, and engineers. Billable time is often tracked down to six-minute increments, a measure of the importance of generating revenue for the firm while providing clients with advice and counsel.
Recently, in response to more cost-conscious clients, the industry has struggled to find alternatives to the billable hour model. Though it’s not a widespread trend, some firms are negotiating flat fees for handling certain work, success fees for positive outcomes, and payments for meeting agreed upon benchmarks such as settling a case for less than the client feared having to pay if it lost in court.4 Many smaller firms and solo attorneys have long performed basic legal services, such as drawing up simple wills and trusts for flat fees, and plaintiff lawyers often work on a contingency basis. But pricing complicated legal work is difficult, and when the recession ends, so too may the push for alternatives to hourly billing.
