For other readers, the first part of this post is from my editorial in today’s Pinhawk Librarian News Digest.
When I began working on the digest this morning – I expected there might be an article or blog post that discussed law firm economics, the billable hour or law firm leader expectations for the future – but what I found were four articles/posts that were related enough to see a connection and draw a conclusion or two. Read more:
- Citi Report Shows Law Firm Leaders’ Confidence Waning in Q2 – Sarah Randazzo, Law.com, provides us with a brief summary of the Citibank Law Watch Managing Partner Confidence Index as well as a link to the executive summary of the same report. What’s interesting in this report is with most indicators (overall confidence, economy at large, business conditions-legal profession, profits, revenue, and demand) down, new equity partners is on an upward swing at an astounding 12% increase. Fortunately, expenses are down at 7% to (almost) the same level as they were in Q1 2012.
- Does Hourly Billing Make You More Efficient? – Sam Glover, The Lawyerist, rebuts a recent 3 Geeks blog post in his counterpoint that a lawyer who bills by the hour works harder but not necessarily more efficiently.
- 2012: The Year of Pain – Toby Brown, 3 Geeks and a Law Blog, opines that 2012 is the year the chickens have come home to roost for BigLaw who have been artificially keeping profits the same or for some – up – by drastically cutting expenses.
- Logic and The Value of Time: Another Counterpoint – Toby Brown, 3 Geeks and a Law Blog, rebuts a post by Jordan Furlong, who wants to abolish billable hours, concluding that the focus needs to be “… on how the amount of time and effort can be reduced might be suggested as the next logical conversation in pursuing a profitable practice.”
- Law firms have been cutting expenses while adding more equity partners who cost more. Sounds like some bad decision making in my book.
- Law fims continue to focus on working harder not smarter in their efforts towards profits.
- Law firm partners need to start investing in their business to allow their firms to continue as a viable businesses. How can problems be solved without an investment?
- Time for the same old, same old is up. It’s now time to get serious about increasing revenues rather than reducing expenses in order to create real profit.
In my early days as a librarian in a large law firm, I attended an annual meeting for support staff where the managing partner told us that the firm needed to cut expenses in order to stay profitable. This firm was what I would call a fast or feast firm where money was spent lavishly when there were excess profits and costs were cut when things were bad which eventually happened in the cyclical beast that law is.
It may have been the MBA classes I was taking at the time, but I couldn’t help myself, I thought he was wrong and I also thought if I didn’t voice my thoughts, I would not be true to myself (Heady thinking for a newish librarian) so I wrote the managing partner a memo, urging him to start investing in the firm’s future while, at the same time, finding ways to increase revenue.
His response was to send me a memo, thanking me for sharing and asking me to talk to the firm’s executive director about my concerns. The executive director didn’t fire me, but he did tell me a story about my flying on a plane and wanting to get off that plane in mid-air. He then cautioned me to make sure I have another plane below to catch me before I jumped. Probably not one of his most brilliant communications to a staff member, but I got his drift.
I am older and somewhat wiser but I may still be naive enough to think that partner’s in law firms have or will begin the work of turning things around, not going back to where things were before 2008, but to take a new direction in keeping their firms – not just in business – but profitable as well. Change management experts tell us that people don’t change unless they are facing some type of crisis. It would seem that now is the time for change.
How can the library play a part in supporting the change that needs to happen? By their firm’s recognizing the value of information and how important knowledge-based decision-making is in forging new directions. If they do, librarians can support their firm’s growth in their role as experts in finding, culling, and analysing information.
Any firm that does not place value in information and those who don’t provide support in the use of information to build knowledge, are also those who think the library is no longer relevant. If they only knew what they are missing because they haven’t invested in what’s important. Now, how can we change that?