Canadian Lawyer

w w w . C A N A D I A N L a w y e r m a g . c o m J U N E 2 0 1 7 25 happening in the law firms. The rad- ical transformation is happening in the demand for the services, not from the suppliers. Everybody's willing to consider alter- native fees in the appropriate circum- stances. And they're open to it and they'll describe how they're open to it. And then you put them to the task and say, "So, propose." And some are a lot better at it than others, and that's where you get to see what separates, as they say, the serious from the lip service. The premise driving alternative fees is "When we succeed, you succeed." And if we don't succeed with your efforts, then you shouldn't succeed so much. The notion that law firms succeed by, regard- less of the outcome, putting in more time is just so contrary to common sense. Should you think the preceding applies to only firms dealing with larger pub- lic companies, you don't have to look any further than the results of Canadian Lawyer's recent survey to experience the same inconsistencies. Of the 538 respon- dents, 76 per cent were with firms with 25 or fewer lawyers. A couple of interest- ing results include: 87 per cent of those responding to the question indicated that they used hourly rate as a leading basis of how they charge clients; and 53 per cent responded that they would keep the same rates in 2017. And yet 67 per cent of the respondents said they were proactive in developing alternative billing arrangements! In other words, the profession's attention to the changes is pure lip service. They will go to painful lengths to identify, articulate and even suggest solutions, but they can't deliver, and clients are seeing through the myth that they are willing to embrace change. For some years, I have used the analogy of building a house as to the fallacy of not providing a budget/estimate of the cost, passing along efficiencies and fixed-fee certainty over the hourly rate. However, Headon provided me with an analogy that provided even greater clarity as to the need for innovation in both pricing and delivery of legal services. "We billed airline tickets as much as 12 months in advance. We didn't know if there were going to be headwinds, snow- storms, the price of fuel, but we're not going to land the plane and have the pilot say, 'Well, you know, that took a little long- er, so we incurred some more employee costs. Could you all give us your credit card?' Similarly, we don't get to use anti- quated technology and tell our passengers 'Well, that's a little harder, so, we are going to charge you a little more for it.'" My sense is that there is a growing degree of frustration with the lack of sub- stantive initiatives being undertaken by law firms; likely, it is fortunate that they currently compete with other law firms. McCaskill describes a too frequent discus- sion that often goes like this: "We are open to anything. What would you suggest?" And I always say, "Look, it's not for me to tell you how to organize your firm or deliver a legal service. That is for you guys to think about. You know, I'm really trans- parent with, you know, about what I need. Now, it seems to me it's up to you guys to figure out how you're going to respond to that need." While alternative providers may never totally unseat the larger firms, they are seen to be an increasingly viable provider of legal services more in tune with the needs of clients. Lest you get the wrong impression of the tenor of our conversation, they all had examples of a firm developing and initiating an innovative approach to both the delivery and pricing of their services. Emily Jelich provided an excellent exam- ple of where not only did a firm create a win-win situation but a side benefit to the client resulted from its approach. "We went to an RFP, and the firm that was ultimately successful did a very good job of saying, you know, 'We understand the legal questions, but tell us what your pain points are. Like, why are you coming to this?' Their inquiry was not focused on legal issues but what they got to was an understand- ing of the challenges of we as a legal team. And so for their purposes given the nature of the fee arrangement, but also to address this problem, one of the things they did was they built a database that was searchable. This approach pro- vided visibility of who's asking and what they're asking so that we could focus on getting more training or more resources to people in this field." Obviously, some clients have had dif- ferent experiences, but the in-house law- yers who were so kind as to honestly share their experiences have a relatively broad exposure to a good cross-section of Can- adian law firms. There is no solace in not being any worse than your competition! Rather, the stage is clearly set for a few firms to embrace breakout innovation resulting in real differentiation. This differentiation is not solely the domain of "big law" but rather wide open for small to mid-size firms. But perhaps the game changer will not even be a traditional law firm! Stephen Mabey is a CPA, CA and the managing director of Applied Strategies, Inc. Voting open until June 12 V i s i t WWW.CANADIANLAWYERMAG.COM/SURVEYS f o r d e t a i l s Vote for Canada's most influential lawyers Untitled-4 1 2017-05-12 10:53 AM

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