The Power of Perspectives

The Canadian Bar Association

Fred Headon

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Change for the sake of progress

By Fred Headon May 27, 2013 27 May 2013

What happens when you take a buzzword – retail law, for example, or alternate fee structure, or alternative business model – and make it reality?

A background paper prepared for the CBA’s Legal Futures Initiative asked that question, looking at 14 cases where law firms challenged the traditional way of doing things – and prospered. Here are some examples:

Co-operative Legal Services Ltd. … is now offering legal services to the general public through its connection to the larger retailer, The Co-operative Group. The Group operates over 3,000 stores and pharmacies, and 1,000 bank branches in the United Kingdom. …The Co-op offers low-cost legal services (to seven million-plus Group members), usually at a flat rate, for will writing, probate, land transfers, personal injury claims, employment law and family law.”

“According to its website, over the last 10 years, CyberSettle has handled over 200,000 transactions, facilitating over $1.6 billion in settlements. … CyberSettle also has over 150,000 attorneys registered on its system.”

 “SkyLaw demonstrates that Canadian law firms can change the way they are structured without the deregulation or widespread liberalization of the legal industry that has occurred in the United Kingdom.”

Axiom currently employs over 900 lawyers and has offices in 11 locations. In 2011, Axiom posted revenues of $130 million, a 62 per cent increase over 2010.”

Few of these firms originate in Canada or even operate here, though in a couple of cases, for example, online dispute resolution, there are Canadian firms following the same template of service. These alternative business models, and fee structures, have worked elsewhere and could presumably work here, though it must be noted that the Canadian regulatory environment does not allow for some of the business models examined in the paper.

No one’s arguing that there should be change for the sake of change, but in the face of the pressures buffeting the legal system – globalization, the economy, technological advances – this appears to come under the rubric of change for the sake of progress.

What do you think – status quo, or no? Join the conversation. #cbafutures
 
 
 

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Seeing the glass half full

By Fred Headon May 21, 2013 21 May 2013

“Though we need to be as fully cognizant as possible of the dangers that beset the practice of law, we ought not to be driven forward by fear of loss, but rather drawn into the future by the lure of a greatly improved role for lawyers.”

So says Slaw.ca founder Simon Fodden in a background paper prepared for CBA’s Legal Futures Initiative, whose goal is to identify the factors pressuring for change, and help the legal profession better position itself to succeed in the next decade and beyond. Fodden takes a look at what some of the leading authors and commentators in Canada are saying about the principal forces behind a call to action: globalization, the economy, technology; and some of the traditional reasons for inaction: conservatism in the profession, and lack of a cohesive centre making it difficult to move in bold directions.

On balance, he sees the legal profession’s glass as half-full. All that’s really needed, he suggests, is the nerve and the imagination to let go of some old ways of thinking and grab the new. Without competition or the pressure to innovate over time, Fodden says, the legal system has created inefficient delivery systems for services – something competitors are already capitalizing on, “nibbling away” at lawyers’ traditional business. Non-legal and paralegal professionals have developed innovative ways to routinize and commoditize some services, and can do them skilfully with and without computers, he says. Meanwhile, computers can already displace lawyers, and within a decade or so may be able to replace them. So the question presents itself – do lawyers need or want to do the jobs non-legal and paralegal professionals, not to mention machines, are doing? Or can they work with others to provide clients with quality services at lower costs?

“The profession has the opportunity to create and refine stimulating and satisfying ways of practicing that eliminate much drudgery, offer clients more precisely what is needed, and thrust forward those services lawyers can uniquely provide,” says Fodden. Don’t fear the drudgery reaper, then. “Necessity is the mother of invention, but fear makes a lousy seedbed for creativity,” says Fodden. What’s your bright idea? How have clients responded to it – or what is standing in the way of giving it a try? Join the conversation. #cbafutures

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Should I stay or should I go?

By Fred Headon May 15, 2013 15 May 2013

In legal circles, disruption is more likely to be someone making a scene outside the boardroom than something going on in the industry. As Jordan Furlong pointed out in a recent Law21 blog post, people keep using the word “disruption” without a clear understanding of what it means.

Disruption means more than just innovation – it means turning the world on its head to see what shakes out.

Bruce MacEwen, president of U.S. legal consulting firm Adam Smith, Esq., more or less makes the case for disruption in an overview of the state of the industry south of the border, prepared for CBA’s Legal Futures Initiative. He points to a long list of businesses that, when given the opportunity to take a game-changing fork in the road or stay the course, opted for the latter – and in doing so, essentially chose irrelevance. Law firms and lawyers are being pounded by forces not of their making. Technology, globalization, “market-empowered clients,” to use MacEwen’s term, are all ramping up the pressure for the legal system to adapt to the reality they’re creating.

“Two roads diverged in a wood, and I, took the one less traveled by, And that has made all the difference,” Robert Frost wrote. That fork in the road is getting closer all the time. On the one side are new business models and new ways of doing old things – most of which have been seen to work, at least on the small scale. On the other is the status quo. So look down the path as far as you can and ask yourself, which is the riskier one to take?

Join the conversation at #cbafutures

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The stories behind the statistics

By Fred Headon May 12, 2013 12 May 2013

Statistics show a moment in time – and only what you ask to see.

The magic is all in the spin. Flick the wrist one way, and we see a sunny world where people are choosing to go into law in greater numbers than ever before. And why wouldn’t they? Compensation is good and growing faster than the cost of living, so there’s a good chance there will be something left over after the necessities are taken care of. The bulk of the jobs are in the big cities, whose bright lights offer an attractive lifestyle for new calls. And it’s the kind of job that can see you well into your senior years – the average retirement age is 75.

A different spin suggests law schools are turning out grads at a higher number than the industry can absorb – in part because the senior cohort is hanging on instead of retiring and opening up spots. Fees and compensation are rising at twice the rate of the consumer price index, which helps put legal services beyond the reach of many. With most new calls heading to the big cities, law firms in smaller areas are withering on the vine, again narrowing accessibility. And despite law faculty populations better reflecting the diversity of the Canadian population, the practising bar still lags.

Statistics without context are just numbers. These were gathered in a report commissioned by the Canadian Bar Association for its Legal Futures Initiative, which was launched under the premise that the legal system needs to adapt to coming changes. When combined with the other research we have commissioned for the initiative, the statistics suggest we may be in for a rude awakening. CBA research suggests that one of the obstacles to change is the fact that many of the profession continue to see their glasses as half full – their own practices continue to prosper, so the impetus to see and react to the latter reading is lacking. Things may not seem so rosy when each lawyer’s practice is seen in the larger context. For example:

  • 449 – number of citizens for every practising lawyer in Canada in 2000
  • 396 – number of citizens for every practising lawyer in Canada in 2010
  • 256 – number of citizens for every practising lawyer in the U.S. in 2010
  • 20.4 – percentage of Canadian lawyers with 25+ years of experience in 2001
  • 31 – percentage of Canadian lawyers with 25+ years of experience in 2010
  • 19.8  and 18.8 – 2000 and 2010 percentages for Canadian lawyers with less than five years’ experience
  • 18 and 14.6 – 2000 and 2010 figures for lawyers with 6-10 years’ experience
  • 88 – percentage of Alberta lawyers working in Calgary and Edmonton
  • 82.6 – percentage of lawyers nationally with less than five years’ experience working in urban areas
  • 80 – percentage, in 2006, of Canadian population living in urban areas
  • 42.3 – percentage increase in lawyers’ fees between 2005 and 2010
  • 23.8 – percentage increase in lawyers’ fees between 2010 and 2012
  • 12 and 8.9 – percentage increase in Consumer Price Index 2005-2010, 2010-2012 respectively

Source: Demographic Trends paper prepared for Canadian Bar Association’s Legal Futures Initiative, January 2013

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New ways of delivering legal services

By Fred Headon May 6, 2013 6 May 2013

As part of its Legal Futures Initiative, the Canadian Bar Association commissioned original research in a number of areas – including a survey of the existing research. One nugget in that study came from a 2004 roundtable in the U.S., in response to a question about what the biggest difference in the practice of law 20 years from now will be:

There will be two extremes of practice. At one end would be the simple, routine matters for which most people will not retain a lawyer either because they will obtain “do-it-yourself” counsel through the internet or will rely on paralegals and non-lawyer consultants. At the other end would be the complex matters for which clients will require counsel and representation. This includes trial work and new areas of law. This division between the two extremes is explained by cost…

In 2013, nearly halfway through the time frame imagined by the roundtable, non-legal and paralegal practitioners are not only stepping up to do the work traditionally done by lawyers, but indeed clients are looking for ways to be more involved in decision making about the file and in performing some tasks themselves.  A number of forces at play throughout contemporary society are coming to bear on the profession. Some of them have direct effects – like the access to cheaper alternative service providers that technology and globalization have made available –and some indirect – like clients wanting to interact with the lawyers through means and in patterns they interact with other people in their lives.

The question lawyers must now ask themselves, and develop the answer before someone does for them, is what should the profession can and how can that best be delivered? What can or should lawyers do and where can we work with all legal professionals to deliver service in the new kinds of ways clients expect? Join the conversation. #cbafutures
 

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Fred Headon is a past President of the Canadian Bar Association and chair of the CBA Legal Futures Initiative. / Fred Headon est le président sortant de l'Association du Barreau canadien et préside le Projet de l'ABC Avenirs en droit.

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