"Firms have recognized these factors and have already addressed them with proactive, forward-thinking strategies that combine strategic real estate reduction with robust technological investments."
Good Morning Folks,
Today, via the ALA on LinkedIN, we will discuss specific innovations that successful firms will employ to control expenses and thrive in the new era of legal services.
This article outlines external trends that affect the workplace, providing context for new challenges and opportunities that traditional AmLaw 200 law firms are facing.
Economics
On the economic front there is ample evidence of permanent structural change. Q1 2013 has reinforced the tight demand and projected economic growth does not guarantee a correlation with a law firm’s well-being due to rate growth pressure, AFA’s, increased competition and enabling technologies. Blind acceptance of fixed expense structures is not a viable strategy for long-term health.
Real Estate
Law firms get killed by real estate due to:
- Excess capacity
- Mismatch between actual functional requirements and space provided
- Expensive “Class A” lease rates
- Unproductive traditional layouts
However, rather than proactively deal with aging space and outdated models many firms continue to tolerate wasteful administration of their highest fixed expense after compensation. External forces demand new ways of thinking about the workplace.
Technology
Technology affects every aspect of legal practice and administration. With less physical “stuff” in the workplace, the total office footprint can be reduced, with no negative impact on productivity.
Mobile technologies invite further reductions in office space. A lawyer or staff employee no longer needs be attached to his or her desk to be productive. The promise of alternative work locations in the office and off-site is real.
Demographics
The new workplace must be conceived as a combination of space + technology. In fact, all demographic groups that follow Boomers prize flexibility and technology over space.
Within five years, Boomers will comprise less than 25% of the total workforce. While that percentage will be higher in law firms, the productivity potential of tech-driven attorneys and staff will outweigh accommodation of retiring partners.
Business Structures
Business structures are evolving too. In addition to slumping productivity and demand, the anemic rate of profits growth is also attributed to alternative fee arrangements (AFAs), and increasing fee competition.
Leverage strategies — associate ratios and temporary or staff attorneys, combined with multi-market management and AFAs — affect workplace dynamics and space needs. Traditional fixed partner and associate office layouts and assignments do not serve more fluid needs.
Competitive situation
In the context of these external pressures, failure to evolve the new workplace creates a serious competitive disadvantage. Firms have recognized these factors and have already addressed them with proactive, forward-thinking strategies that combine strategic real estate reduction with robust technological investments.
Have a GREAT day. Love LIFE!
Chief Happiness Officer
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"You can't live a positive life with a negative mind."
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Filed under: Legal, New Workplace Strategy and tagged CAFM, digital floor plans, IWMS, law firm technology, legal, legal administrators, legal industry, office productivity, online floor plans, optimize shared workplace, optimize workplace, real estate productivity, FSO, shared workplace, workplace consolidation, workplace management, workplace solutions
