About the episode:
No risk, no reward—in this second episode of season two of Matters, we’ll take a high-level view of the legal profession—chiefly, why lawyers tend to be so risk-averse, and the effects that this cautiousness has on legal practice, innovation, and firm sustainability.
For this discussion, our hosts, Jack and Nefra, welcome renowned legal author Mitch Kowalski, Big Law attorney and Access to Justice expert Tiffany Graves, and award-winning law professor and scholar Bill Henderson.
Specific discussion points include:
- Why so many lawyers and law firms have been slow to adapt to technological changes, as compared to other industries.
- Why change is scary for many legal professionals, and how resistance to change stifles progress in the industry.
- How adopting a client-centered mindset encourages legal professionals to be more adaptive and innovative.
- What progress has been made in recent years, especially as the industry responded to Covid-19.
- Why lawyers’ emphasis on risk management can have strong negative consequences when applied to law firm business decisions.
- How thinking like a businessperson emphasizes smart risk-taking, and why lawyers should adopt a business mindset.
Listen in for these takeaways and more!
CLE Credit: This episode is eligible for 0.5 hours of CLE credit in the State of Florida. Florida Bar members should visit the Florida Bar Member Portal and enter CLE code 5520.
Mitch Kowalski is a lawyer, writer, keynote speaker, legal operations consultant, and author of the critically-acclaimed books The Great Legal Reformation and Avoiding Extinction: Reimagining Legal Services for the 21st Century. A College of Law Practice Management Fellow and a Fastcase 50 Innovator Award honoree, Mitch has general counsel, international law firm partner, and Board of Directors experience. As a legal consultant, he helps teams and law firms to deliver value and perform at higher levels. Mitch speaks on legal service innovation at conferences around the world and writes for a variety of publications about the challenges of legal operations. You can follow him on Twitter at @MEKowalski
Tiffany M. Graves serves as Pro Bono Counsel at Bradley, a 500-attorney law firm with offices across the southern United States. In her role, Tiffany oversees the development and administration of the firm’s pro bono programs. Prior to joining Bradley, Tiffany was the executive director of the Mississippi Access to Justice Commission, where she led a 21-member commission created by the Mississippi Supreme Court and promoted its initiatives to improve and expand access to civil justice to the nearly 700,000 Mississippians living in poverty. In addition, Tiffany previously served as interim director and adjunct professor for the Pro Bono Initiative at the University of Mississippi School of Law, and as executive director and general counsel for the Mississippi Volunteer Lawyers Project. You can follow Tiffany on Twitter at @tiffmgraves
Bill Henderson joined the Indiana University Maurer School of Law faculty in 2003 following a visiting appointment at Chicago-Kent College of Law and a judicial clerkship for Judge Richard Cudahy of the U.S. Court of Appeals for the Seventh Circuit. Drawing upon more than a decade of research, Bill is a sought-after commentator on the changing legal marketplace and has accumulated numerous awards. In the last five years, he has been named one of the 100 Most Influential Lawyers in America by the National Law Journal, the Most Influential Person in Legal Education by National Jurist Magazine, and one of the inaugural group of “Legal Rebels” profiled by the ABA Journal. You can follow Bill on Twitter at @wihender
Jack Newton is the CEO and Co-founder of Clio, and a pioneer of cloud-based legal technology. In addition to building Clio from a startup to a market leader now valued at over $1.6 billion, Jack has spearheaded efforts to educate the legal community on the security, ethics, and privacy issues surrounding cloud computing. Jack is a nationally recognized writer and speaker on the state of the legal industry, and he is the author of The Client-Centered Law Firm, the bestselling book for law firms looking to succeed in the experience-driven age, available at clientcenteredlawfirm.com. You can follow Jack on Twitter at @jack_newton
Nefra-Ann MacDonald is a legal technology and wellness speaker who, as the team lead of Affinity Partnerships at Clio, works with bar associations and other legal organizations to help lawyers succeed in their practices. Having worked in legal for over a decade, Nefra understands the pain points that affect legal professionals, and she uses her experience to help lawyers streamline processes and run a better business. Nefra has spoken at the Clio Cloud Conference, ABA TECHSHOW, and at many other legal conferences across North America. You can follow Nefra on Twitter at @nefra_ann
Read full transcript
Jack Newton: [00:00:00] Hello, and welcome to season two of the matters podcast brought to you by Clio the world’s leading provider of cloud-based legal software. We’re doing a few things differently in season two than we did in season one, starting with a new format, hosted by myself. And now for MacDonald. Hey Nefra. Should we introduce ourselves, Jack?
Nefra Macdonald: [00:00:21] I was thinking, why don’t we introduce each other? I’ll go first. I’m pleased to be joined the season by my cohost Jack Newton. Jack is the CEO and co-founder of Clio, a legal tech company he began as a startup, which is now valued at over $1.6 billion. In addition to his work at Clio, Jack has spearheaded efforts to educate the legal community on security, ethics, and privacy issues around cloud computing.
And he’s a nationally recognized writer and speaker on the state of the legal industry. He hosted the Daily Matters podcast during the COVID-19 pandemic, and he’s the author of the bestselling book, The Client Centered Law Firm, which is the inspiration for this season of our show.
Jack Newton: [00:01:05] Wow. Thanks for making me sound so cool, Nefra.
And I am in turn pleased to be joined by my cohost Nefra MacDonald. Nefra is our Affinity Partnerships Manager here at Clio. A graduate of the University of Miami, Nefra’s experience in law school led her to devote her career to improving the legal industry. She speaks regularly at legal events and conferences across North America, and she is passionate about legal technology, attorney health and wellness, and the future of law.
Nefra Macdonald: [00:01:33] Thanks, Jack. So about this season of Matters, we’ll be focusing specifically on client-centered lawyering. We’ll dive deeper into the concepts highlighted in Jack’s Client Centered Law Firm book by bringing you, our listener, into the fascinating conversations we’re having at Clio with our friends and colleagues in the legal industry.
Jack Newton: [00:01:52] We’ll talk to lawyers, legal consultants and scholars, and even some experts outside of legal to better understand what client-centered lawyering is, why the industry needs to shift in a client centered direction and how you can implement practical client centered strategies at your law firm.
Nefra Macdonald: [00:02:09] Today’s first episode is all about the why of client-centered lawyering, but let’s back up a bit first, if you’re new to the podcast or you haven’t read Jack’s book, we might need to explain what we mean by client-centered lawyering. And I thought who better to give us the quick definition than the man who literally wrote the book on it.
In legal, the term client centered means that the services provided by legal professionals, firms, and organizations match the needs and expectations of legal clients. Although that may sound like an obvious business strategy. It’s actually something that many law firms do poorly. And this has been the case for decades. Often law firms don’t prioritize, what’s known as the product, the market fit. The services firms are providing are not meeting the needs of the legal market.
One great way to address this is to become a client centered law firm.
You know, I love the examples you use in your book about how clients’ needs and expectations are changing with the rise of client centered apps like Uber, Airbnb, and Netflix customers now expect higher levels of service from all kinds of companies and law firms are no exception.
Jack Newton: [00:03:20] Yeah. The bar has really been raised in all industries, including legal. Customers now expect a different experience from lawyers and law firms. And that’s where the client centered model becomes so important, especially in light of the changes COVID-19 brought to the industry, the old models for legal service delivery just don’t cut it anymore.
Nefra Macdonald: [00:03:40] That brings us to our first. Guest Kim Bennett. Kim is an industry disruptor who founded a virtual brand strategy and protection law practice called pay Bennet.
Jack Newton: [00:03:50] Kim has practiced law for more than a decade and a half. So I started our conversation by asking how she’s seen the industry shift towards a more client centered model during that time, particularly in the last several years.
Kim Bennett: [00:04:04] Yeah, I think that’s a interesting question because have I seen it enough? Um, I think we haven’t seen it enough, but I’ve seen it happen much more in small law. And interestingly, I will say a bit in corporate and maybe because that’s where I started in corporate. So we’ve always been focused on our internal clients and how to like serve them and keep them happy and thinking about “how do we still grow as a team and be effective?”
But I find most of that movement happening in small law when I look at it, um, globally, but I think we still have so much further to go. But I’ll say, listen, Mid pandemic, where we’re at, the strides that we’ve made in the past year are phenomenal and it’s unfortunate it had to be a pandemic, but thank goodness.
Jack Newton: [00:04:49] Maybe, maybe you can speak to that. What hints of the industry becoming more client centric, have you started to see emerge over the course of COVID?
Kim Bennett: [00:04:59] I think all of the assumptions a lot of law firms made about clients were dismantled during the pandemic. Like, oh my clients will never want to just see me on video.
Or they always want to come into my office or they won’t take payment that way. Or they can’t use technology. And the pandemic moved everyone’s life completely, which meant what maybe clients weren’t used to, whether it was, you know, clients that are maybe at, you know, second half of life and they’re thinking about, well, those clients wouldn’t be, they were super able to move forward or their team members not being as effective working remotely.
I just think a lot of the assumptions that people made were challenged and they were dismantled during the pandemic that allowed for people to think of all the times, they were like “no way this could happen,” now they saw that it could, and they were willing to start taking steps to really think about how to design better, how to think about the client experience, how to rethink, how they’re offering services, and think about how it can show up for their team and the people that they’re working with and who they serve.
Jack Newton: [00:05:58] And I, I think what we saw concurrent with that was also client perceptions and client expectations shifting really dramatically over the course of the pandemic as well, even clients that may not have thought that their legal issue could be handled entirely over a Zoom call, for example, now understand it can be, and may actually prefer that over meeting in a bricks and mortar law office.
Kim Bennett: [00:06:20] Oh a hundred percent. I mean, I think the courts are a great example of that too. Where people who thought, well, I have to go to court to have this thing, answered, or I was a judge. I have to be, in court to be able to see my client, you know, seeing that the clients see the, uh, the person that’s appearing before them.
Right. For sure. And I think clients, I think we did a bad job as an industry of showing clients that there are different ways we can show up and serve them. And now clients had to move and their perception of how we have to work with them was guided by how. We told them we needed to do it. And because the world had to change, clients were so much more open because they realize I operate my entire life like this.
Why can’t I work with my lawyer in the same way?
Jack Newton: [00:07:02] With these rapid shifts in client expectations and client preferences. I think being client centered is more important today than it’s ever been. Can you tell us more about what client-centered lawyering means to you and your firm?
Kim Bennett: [00:07:16] Yeah, for me, it means designing an experience that leads with empathy, that embraces active listening ,that shows that we show up as a team member for the people that we serve.
And that I also want to be the place that people want to work. I want to be an employer of choice. And I think all of that comes from my experience in both law and psychology and I’ve always approached it that way. And I think that was something that was different for those of us that were in that smaller cohort in, in law school where we’re doing that dual degree program.
But that’s what it means to me, just like being a better listener, thinking about what it’s like for the client, thinking about them as a full, complete person. And we’re just a drop in the bucket of what’s happening in the rest of their life. And then also being a place that others want to work at so that we can continue to build that experience.
And, um, What do I see in it’s impact? Um, yeah, I think. It’s tremendous. I think it’s what sets us apart. The best way I can say it is what a client said to me was that the client, a client literally said this to me. They said it to me a couple of times, because we show up as internal team members and they said, we feel like you are a partner to us.
We feel like you’re a team member. Sometimes we don’t even know how you know this much about our business and you’re not here full time. And I think that’s what client centered strategies have done for my firm and how they showed up as the impact that it’s made, simply because we can deliver that type of experience while also thinking about how we show up as a team that makes us manage our wellbeing too.
Jack Newton: [00:08:42] So you’ve had amazing impacts on your firm, on the client base and how you practice law with client centered lawyering. Can you tell us why client-centered lawyering seems so revolutionary?
Kim Bennett: [00:08:58] I think it’s just not what we’re taught. Lawyers, in particular, are taught to, unfortunately, I believe in law school, center ourselves.
Right. And we think while we’re trying to solve problems, we forget about who we’re solving problems for and what’s happening in the rest of their life. And we don’t necessarily bring in all the other disciplines that are important to the conversation about working in solving problems for clients.
And so that translates into how we practice then. And so I think there’s just a big shift in how the industry has always operated and that we have to change. And that it’s no longer appropriate to say we’re going to hold on to all the knowledge. There’s access to knowledge in ways that you never had before.
So I think it’s revolutionary because of technology changing, because clients have changed, because those that are coming into the industry are changing so that they w they expect us to do more than just show up and give them a doc, show up and give them a divorce. They really want us to understand what’s happening so that we can get them to that next stage in life or in business beyond just that one small piece.
They want to see the bigger picture. And I think that’s why it’s so revolutionary, right? Because we are shifting ,clients are shifting, the world is shifting, and the law and legal industry has not done that. And now it’s time to play catch up.
Jack Newton: [00:10:19] Tell us more about why the industry needs to adapt to the client’s needs now. Why should a firm have a sense of urgency around becoming more client-centered today?
Kim Bennett: [00:10:29] So I don’t think technology is going to take over what we do, but I do think there’s some of what we do that lends itself better to technology. And then if we don’t care about the experience, if we don’t think about what’s happening for the clients, what outcomes they’re looking for, what it’s like to have all the touch points with us before and after we’re going to continue to leave a lot of the needs that we have yet to meet unmet. The urgency is now because the time has been passed where we needed to shift and do better. And we just have stayed stuck and not really listened to what clients want. And even with those that are coming to our industry, one like the newer attorneys, the legal, other, all legal professionals, not just even attorneys.
Nefra Macdonald: [00:11:16] I love what Kim says there about how lawyers have stopped listening. She’s so right. It seems like a simple shift to make, but the legal industry has really struggled with that shift in the past few years. And right now there’s a sense of urgency because as Kim says, the time has passed.
Jack Newton: [00:11:33] Yeah. And it’s really important for law firms to pay attention to what Kim is doing.
She’s implementing client centered practices into her law firm, and that change is having a huge impact for her.
Nefra Macdonald: [00:11:44] Clients are beginning to expect better service and Kim is delivering it, but many firms are hesitant to really change the way they do things and adopt a client centered model.
Jack Newton: [00:11:55] Exactly. And that’s what I spoke to Jordan Furlong about; a legal analyst and consultant who founded the Law21 blog.
Jordan really put this hesitancy law firms have into context. Here’s how he put it.
Jordan Furlong: [00:12:09] Jack from my perspective, I think the right way to look at the whole question of client centricity in the law is almost to think about, would we ever have a conversation about the opposite? You know, imagine a world in which law firms were already client centric and lawyers were already thinking of their clients, not 24/7, but as a high priority.
And imagine someone comes into the boardroom and says, uh, folks. Got a great idea here. Listen, how about we start paying less attention to the clients and we care a little bit less about the client experience, but we spend a lot more time focusing on making as much money as we can, and dragging out the process by making it more difficult for people. And the looks you would get in that circumstance.
Of course! That’s crazy. Why would you ever even think about doing that? So, part of the challenge we have when talking about, as we do need to talk about the shift of client centricity in the law is to say, why in the world has it taken us this long? Why isn’t this already the way we show that we’re doing things?
So I think the main reason why we need to be talking about this is that it is a long overdue, corrective to the way we have been working in the law for decades, for arguably even longer than that. And just reorient ourselves to remind ourselves the whole point of being in the practice of law in the legal services industry is to serve.
And we need to know who we’re serving, why they need us to serve them and what kind of outcomes they’re looking for. That to me is foundational. That to me is where we need to start.
Jack Newton: [00:13:46] So you, you talked about maybe framing it through looking at its opposite. Maybe let’s talk about that for a moment.
What do you think the status quo looks like and why is this idea of a client-centered legal practice such a novel seeming idea in the legal industry?
Jordan Furlong: [00:14:06] I think there were a myriad factors that have gone into creating an environment in which lawyers’ services and law firms as the business vehicle for lawyer services have gotten to this point.
And you can identify a number of different culprits. We can talk about the fact that there is hardly any training or preparation for lawyers at any stage of their careers, I’m not just blaming the law schools here, around the purpose of a business and the focus on customers and the whole idea behind nurturing relationships and building them and establishing yourself as a trusted resource and person to reach out to that is not part of our development regime in the law. And of course the development regime in law is an entirely other, uh, whole for us to jump down. But that’s been a really big part of it.
A second part of it has been, we have been for the most part, a market in which the supply side, which of course today is mostly, but not exclusively, lawyers, has traditionally been exclusively lawyers. We have not had to worry about anybody else competing with us. And we have not had to worry that any one of us is going to radically change the approach that we have taken, because again, why, if it ain’t broke, why, why would you fix it? And I think third, there is a real problem around the, I guess you could almost call it the perception gap of, of legal services in particular.
And I think this one afflicts us more than it does other sectors and other industries. Most legal services, as you both know, are the types of purchases or the types of acquisitions that people don’t know the quality of what they’re getting. They’re credence goods. Right. Are they any good? Well, we don’t really know.
We have to take the word that people who are providing it to us, and that has created a position of immense trust and dependency on the part of clients. And they don’t really have much choice except to accept what lawyers have said. This is how I go about it. And that creates this weird dynamic where there’s a dependency and there’s almost a, uh, this massive hierarchical gap between the provider of services and the acquirer of services.
So to a great extent, I think a lot of this is historical. A lot of this is just the built up baggage of a profession that evolved in a very staggering lurching fashion from one day to the next. And then suddenly has had to zoom forward into something brand new. Uh, so, so I don’t really want to point fingers per se, that having been said, we are now aware.
We have been aware for at least a few decades of this problem of lawyer centricity, rather than client centricity and from this point, and frankly for a while now, if we’re not addressing this, that’s on us, we can’t, we can no longer blame “that’s just the way things have always been around here.”
Okay, but now we know better. And what are we going to do about it? That is the question.
Jack Newton: [00:17:15] So Jordan, maybe we can look outside the legal industry for a moment, and we’ve seen plenty of other industries be disrupted by new players that put a high priority on the customer experience and look to differentiate themselves through a great customer experience.
And you know, a few names that come to mind would be Amazon, Netflix, Uber as good examples of these very customer centric, even customer obsessed, organizations. Do you see this starting to happen in legal?
Jordan Furlong: [00:17:47] I can absolutely see the potential for that in legal, but the potential is going to be maybe restricted a bit or harnessed a bit by various factors.
Um, I, because on the one hand, the success of these businesses is phenomenal in it. And I, if I recall correctly, when I wrote the forward for your excellent book, one of the, uh, scenarios I envisioned was imagine a parallel universe where. Sears figured out what to do. And Amazon never developed and Blockbuster figured out what to do and so forth.
And, and I think I still believe there are really harsh lessons there that the legal profession will have to learn. If, if we don’t get our heads around this, that being said, I think there are a couple of mitigating factors that are going to make it more difficult for a company. No matter how customer obsessed there rightly is to make those kinds of inroads. The first goes back to this idea of the credence good. If I’m running a movie from blockbuster and Netflix comes along and says, I’ll give you the same movie, but I’ll send it to you by courier. It’s like, okay, great. That sounds good. It’s the same movie. I know what I’m getting.
And when it arrive, it’s just like, yeah, this is the movie I ordered. And so it’s easier for us to do that. And to a certain extent, even the same with, with Uber versus taxis, right? I’m at point a, I’m getting the point B, right? So that’s fine as well. So there’s not as much of a concern about the quality or the nature of what we’re getting, but that barrier is much higher in the law.
The stakes are higher, the potential for a fallout and damages that things don’t go well if I choose badly is much higher. So, so I think there is a natural speed limit in a way created by the nature of credence goods in the law that is placed upon that ability to, to come in and sweep away through truly innovative approach. And the second aspect of it, and that’s why Uber is actually really interesting as an example, because Uber did something, uh, I think not necessarily unprecedented, but really interesting. Uber came into a heavily regulated market and said, we’re going to ignore all the regulations. We’re just going to break them.
There are many rules around who can, who can, you know, take your passengers around. We’re going to break every single one of them and see what happens. And the remarkable thing about it is that they broke every one of them and they managed to succeed and, and you can raise some qualms and issues about the ethicality of that approach and about the sustainability of that approach across other industries, even this one, but it’s an example of a new provider that came into the industry, they’re recognized. Yes, there’s lots of regulations, but they can be broken with very few consequences. What would it look like if a provider like that came into the law? What would happen if an Elon Musk, for instance, came into the law and said, “Yeah, I know there’s regulations, I know there’s all these things. I don’t care. I’m just going to, I’m going to create this mess of million lawyer law firm. I’m not going to make billions of dollars and I don’t care what anybody says,” you know? And, and the fact of the matter is that might actually work, you know, and, and, but we don’t know, we don’t know what would happen if someone came in and shot through the gauntlet down to the extent that we have seen new providers come into the market as admirable and as interesting as they have been, they have not been at that scale.
LegalZoom was not at the kind of scale where they could take on all 50 states at one time and said, “Bring it on, I’ll take you all down.” Right. It had to kind of go one by one by one. And although it met each of those challenges, it was a real drain on their time and their focus and their resources and their fighting branding battles and all this kind of stuff.
So, uh, so I think it could be done, but I think it would take someone with really deep pockets. Absolutely no compunctions about breaking subtle regulations. And it could, we have a separate conversation, whether that’s right or not, and the ability to withstand all the headwinds that will come with that we might see that we might not because again, laws, not in that very easy market to break into that way.
But I think that is how change like that probably will come about.
Nefra Macdonald: [00:21:51] You know, Jack, as I’m listening to Jordan, it seems like just a matter of time until the experience is king a model makes it to the legal industry.
Jack Newton: [00:22:01] Absolutely. And in a lot of ways, it’s already happening. I spoke to Nika Kabiri from Kabiri consulting about this shift.
She’s an academic who has spent 20 plus years studying how people make decisions in a variety of contexts. Now she works with businesses of all sizes across all industry categories, helping them drive strategic growth. And she said from her perspective, the shift to this client experience is king model has started reshaping legal driven by the same forces present in other industries that have already made this change.
Nika Kabiri: [00:22:35] The industry trends that I’ve seen driving that shift are actually not originating inside the industry, they’re originating inside other industries. It used to be that the consumer didn’t have as much power because they didn’t have as much information. They didn’t have access to information. They couldn’t be in charge or have agency over their decision-making the way they do.
Now, everything you need to know is on the internet, is at your fingertips. And this is true. Or, you know, if you want to buy a car, you want to buy a house. You want to buy a t-shirt or dog food. Um, and this is the way that consumers are thinking right now. This is how they’ve been thinking for a while. And legal has not been catching up.
I think the legal industry is treating consumers as though they’re consumers of the past. Meanwhile, consumers are engaging with products and services in a totally new way and expecting more because they can talk to each other now about what you’re doing right and wrong. They can leave reviews.
They can, you know, it’s not just word of mouth referral in real life. You can blast a lawyer on the internet and either make or break their career. And, there are also just so many resources, content out there to help consumers do what they need to do without lawyers. They demand to be at the center because they can be at the center.
They’ve been at the center in every other industry. and they’re going to expect it from their legal service providers as well. And if it’s not so much the case that if you, if you aren’t human centric, you’re going to fail unless you are behind and you don’t want to be behind. That’s the key, like you want to be at the forefront of this consumer centricity in the legal profession, or you will be left behind.
Jack Newton: [00:24:18] So what’s the opportunity maybe for law firms that, that hear this call to action. You know, you do this or be left behind. Why is it important for those law firms to take a client centered approach? And what’s the opportunity for them if they execute on that really well?
Nika Kabiri: [00:24:36]
Well, the people who are hiring lawyers are the same people that are doing all sorts of other things, buy all sorts of other things, and they’re doing it in the same way that they’re buying all these other things. So if you are treating those consumers as though they are different because they’re looking for legal help than they would be if they’re looking for a car or a house or what have you, you are missing the mark.
It’s really not that hard to meet them where they are. It’s really not that hard to reach them where they’re at. You are a consumer like that now. I mean, you can imagine lawyers are all on Amazon. They’re all buying stuff. You’re reading reviews. You’re looking at ratings, just imagine looking for a lawyer the same way, and this is how people are looking for you.
So it doesn’t really take a lot of work to become client centric or consumer centric. And every little bit helps. It keeps you relevant. It keeps you ahead of the game and. If you fall behind, you are less relevant, you are less appealing. And there’s also a halo effect with, you know, like say things like the use of technology or the ability to put consumer needs first that if you can do that, then everything else you do suddenly seem so much better, even if it’s not. So there really is very little reason not to put the consumer first.
Jack Newton: [00:25:55] What do law firms risk by not evolving to become more client centered?
Nika Kabiri: [00:26:00] By not evolving law firms, risk being irrelevant. They risk looking archaic and outdated.
Jack Newton: [00:26:09] Like the stakes are existential.
Nika Kabiri: [00:26:13] They are, they are too high because your competitors, there are a lot of competitors. There are a lot of lawyers right now, and we see this through, you know, their use of Clio and other types of technology, cloud services. There are a lot of lawyers that are getting on that bandwagon and they’re moving fast and they’re practicing virtually. I mean, you might not know this because you’re not talking to these lawyers, but they’re out there.
We talk to them all the time. We research them all the time. And I mean, I personally know consumers who specifically ask and you know, their lawyers that they’re hiring. Do you text, do you handle things digitally? Can I do e-signature are you remotely available for remote practice or remote representation that it’s the, the ship has sailed, like it’s going in that direction.
The train has left the station. I don’t know how many other analogies you want me to use. Um, but it’s, it’s really, uh, the, your livelihood depends on it.
Jack Newton: [00:27:05] The other analogy, if you’re looking to add your collection that I like a lot is the Wayne Gretzky quote. And apparently is actually Wayne Gretzky’s dad, uh, that said this originally, but “You want to skate to where the puck is going, not where it was and that’s how you win the game.”
Nika Kabiri: [00:27:19] Exactly. That’s how you win the game and, you know, okay. If I can bring an apply to a boxing analogy, you can fight, you can fight to win, or you can fight to not lose. And they are two totally different things. There are two totally different things. And I think lawyers, these days, a lot of lawyers who are consumer centric are fighting to not lose.
They just want to get by. They want to do good enough, but that’s not the same as succeeding.
Jack Newton: [00:27:39] All the analogies aside. What Nika is saying here is so important. And it’s what most of our guests on this episode have said, The stakes are high and the train is moving quickly away from the station.
Nefra Macdonald: [00:27:51] Obviously as a legal software company, we believe that technology will help law firms become more client centered and better meet the needs of the market.
But is that actually the case? And if so, what does it mean for legal professionals and law firms?
Jack Newton: [00:28:07] That is exactly where our last guest comes in today. Bill Henderson is a legal scholar, the editor of legal evolution and co-founder of the Institute for the future of the legal profession. Bill does a really great job of grounding this discussion in where the industry has been, how it’s changed the last two decades and where he thinks it will go.
Here’s my conversation with Bill.
Jack Newton: Bill, what are some of the market changes you’ve seen impact the legal industry over your career? O
Bill Henderson: [00:28:35] Oh boy, Jack. That’s a really good question. I, I think that the first one, the one that, uh, that made my career actually was the, uh, Was noting the bi-modal distributions.
This is a little bit, a little bit obscure, except if you live through that era. But it was basically a white hot corporate law market that basically led to the shortage of entry-level associates. We couldn’t get enough of them and a bidding war began. And Noah, he could actually goes back to the 1980s, but we actually ran out of well-credentialed people who are, who, who are suitable for big law.
And that happened around, uh, 2006. And so that the, uh, it was a, you know, when you have a, when you have a, any kind of like height versus weight, it’s a normal distribution, but there was a two modes where, where you had a bunch of people making a certain amount of money in the center, and then a second mode.
That was way off to the right. Where people were paying extravagant sums of money to the big law, uh, you know, marketed because there just wasn’t enough people to kind of go around that met their kind of credentials. And that crashed and burned in 2009. And they, uh, and I think that that was an interesting trend, uh, that, uh, that, that really.
You know, kind of mark the beginning of a completely different era because the corporate market has been flat. Then two other ones, I want to point out too, that I only got only identified as trends through, uh, data. Uh, one of them was the decline of the people law segment, and it says, this is probably near and dear to the hearts of Clio users because it’s, it’s primarily lawyers serving kind of smaller market, you know, smaller businesses and individuals, uh, not these big corporate behemoths, but lawyers have been struggling to make a living, serving people for almost 40 years. This goes back to the Chicago Lawyers One and Two Study, which are two law professor famous studies, uh, that were from 1975 in Chicago in 1995.
And the other one was just the massive growth of the in-house counsel. I saw that through data and we had about 35,000 in-house counsel in 1997. We w we’re up to about 108,000. So there’s this many lawyers working in houses that aren’t corporate law. And so I guess, Jack, the big takeaway from all this is the big law has been the narrative of a, of the legal profession for, uh, close to 20 years.
But if you pull back and you try to get the full market and view it’s a much gated market and there’s no good spokesman for people off, you know, unfortunately.
Jack Newton: [00:31:10] how have you seen some of the transformation in legal influenced by other industries?
Bill Henderson: [00:31:17] You know, um, I think that the, the closest we’re going to come there as this is the software, and you’re going to see, see some influx of software in the legal industry that is starting to change things in fairly big ways. My friend, Dan Katz, maybe listeners know who Dan is. He’s a professor at Chicago, uh, Canton, and as a data scientist, in addition to a lawyer makes a really good point. Is that although the legal vertical is kind of big. It’s not like big like software, bigger automotive, big, you know, like writ large and like the consumer market, the big consumer markets.
It’s about, uh, oh, it’s probably a $400 million, uh, you know, billion dollar vertical, which isn’t very big and the kind of the bigger scheme of things and it’s highly variegated. And so, uh, what I mean by that is, is that, you know, you have big law, but then you have big law broken into attacks, labor and employment, real estate.
And then you get into industry niches and then pretty much, uh, these markets, when you look at the sub markets and the sub sub markets, they’re just highly variegated and it makes it hard to generalize about, uh, actual clients. And so the software is beginning—in certain tronches the market, I mean, Clio is a really good example of it because it’s practice management software and workflow management software for the B2C market, which is, which is fairly uniform. But, um, uh, we’re, we’re beginning to see the, I would say software is probably the best example of this. And I would also say another industry that’s starting to have a big effect is, is just private equity, venture capital, because they’re financing all the information that could that’s poised to happen in this space.
And so you actually have non lawyers, you know, making investment decisions that used to be limited to just lawyers. So keep your eye on that.
Jack Newton: [00:33:20] So you talked about the software industry influencing legal, and one of the things that’s, you know, a famous tool in software development is, is being highly customer centric, being highly client centric, and how you build an iterate on a product that this concept of the minimum, minimum viable product that you.
You iterate on based on what your customers are asking for some of the notions that have been popularized, like doing customer development, uh, by, by Steve blank, for example. Okay. Can you talk maybe about how some of the ways that being more client-centric being more client focused could help law firms navigate some of the changes that are coming up.
Bill Henderson: [00:34:05] Well, Jack, you just asked the million dollar question. This is a very, very difficult, uh, thing to do. First of all, I mean, I’ll give you a kind of client centric. I mean, that is the secret to everything. Part of the, part of the challenge though, is, is that you’re really talking about what we about client centered, you’re talking about empathy. And you’re talking about getting into the shoes of the end user. And actually that does not, that’s not an intuitive process for a large number of lawyers. They can be taught. Uh, but, uh, it’s, it’s its own discipline, like design is its own, uh, discipline and you work backwards from some sort of a persona.
We skipped that in law school, we don’t even talk about empathy, like in the medical profession. Now they have bedside manner, all these things that are, that they’re they’re, they’re, they’re teaching, um, medical professionals or doctors. We don’t even have, um, that there’s barriers everywhere toward just the commercial empathy.
I do want to, if I can, give you a better example of this,. The best example I’ve ever heard is Shannon Salter, who’s the executive director of the Civil Resolution Tribunal up in British Columbia. And, um, for those listeners that don’t know what this is, it’s an online dispute resolution. The first government sponsored one to go live, started in Canada, I don’t know, four or five years ago. And, Shannon is a trained lawyer that was given the task of doing it. This is actually written up on Legal Evolution. Post 99 or something like the history of it. But anyway, Shannon, uh, the, the stars align and they said we’re going to do online dispute resolution.
Uh, and that in Canada, we’re going to do for small states disputes and we’re going to do it for Strata disputes, which is the Canadian word for condominium disputes. And so they got this up and running and Shannon said it was a top gun village. When, uh, when, when it was all, it was, was a website and the Excel spreadsheet, there was no technology behind it.
Uh, but, but there was some demand to build it. And she said, what they did that really made a huge difference was, is they followed around people with a clipboard and they asked them all questions about their user experience. What do you think about this? What do you think about that? And Shannon through that simple process of just observing how forms were being filled out and how people reacting to them, she and her staff made these things more user centric. And, uh, and she said that was the key toward driving up the net satisfaction of a, of the civil resolution curve, you know, every month. Um, you know, the civil resolution tribunal was about, uh, uh, I don’t know, 5,000 matters a month. And then they get a net promoter score and about 85, 86% of the people that use it, the online dispute resolution, like it. Remember there’s a winner and loser.
These are asking people at the end of it all. What’d you think about this? And 85% of the people including, you know, are saying they had a good experience. It’s because they got the thing down to a sixth grade level. So you can pick up your little smartphone. You could file your complaint. No lawyer necessary, actually no lawyer is even permitted to be involved in the process. And by and large, even resolve 85% of these things at your kitchen table. This is all because of the user experience. It’s all because putting the client first and Shannon, when the, when the civil resolution tribunal was given jurisdiction over motor vehicle accidents, some of the personal injury lawyers kind of flipped out, including the ones in the United States that realized what was going on in Canada.
And Shannon, some of the motor vehicle accidents, you can have a lawyer through the online dispute resolution, but why would you, you don’t need one. And so which means that, uh, that the people are going through the process and they don’t have to split the fee with the lawyer.
And the advantage of this is that consumers are going to be made vastly better off. And that lawyers can move up the chain and start solving different orders of problems. We have so much access to justice. We’re not going to run them in our lifetime and software is how we’re going to do it. And we’re going to work backwards from the user experience.
Nefra Macdonald: [00:38:21] So Jack, after you’ve had all of these incredible conversations, I’d love to end each episode with some of your biggest fans.
Jack Newton: [00:38:30] I think from my perspective Nefra, one of the main things that’s really clear from these first set of conversations is that there is a profound sea change happening in terms of how the leading and most innovative law firms are thinking about the way they deliver legal services, and that is in a client-centered way. And I’m really excited to share these concepts out with a broader legal industry, because as obvious as some of these business strategies might seem for a lot of legal professionals, they’ve never had the opportunity to get exposed to these ideas or taught how they can put these ideas into practice in their law firms.
So I’m really excited over the course of this second season of Matters to share out the amazing conversations we’ve had about client-centered lawyering and about what the future of legal will look like.
Nefra Macdonald: [00:39:22] Thanks, Jack. That is a great note to wrap up the first episode of season two of Matters. Coming up next time, we’ll have a discussion on the history of legal service delivery and how the legal industry’s occasionally adversarial relationship with technology applies to our modern context.
Jack Newton: [00:39:39] I’m really looking forward to it. Thanks Nefra, and thanks everyone for listening.
Nefra Macdonald: [00:39:43] This has been a presentation of season two of Matters based on The Client-Centered Law Firm, the best-selling book by Jack Newton matters is hosted by Jack Newton and Nefra McDonald produced by Andrew Booth, Sam Rosenthal and Derek Bolen, and brought to you by Clio the world’s leading cloud-based legal technology provider.
Be sure to subscribe to Matters wherever you get your podcasts. So you never miss an episode. If you’d like to learn more about Clio, please visit us at Clio.com to read Jack’s book search for The Client Centered Law Firm, wherever you buy your books.