Is legal industry going through a surgery?
If I look into the past I could recall the role and involvement of the lawyers limited to the courts and in cases where some crime was committed. People wearing black coats were seen only in or nearby court areas. But the profession has seen major revolutionary changes in recent past. Now lawyers are not limited to courts only where they are involved in criminal cases representing their clients, they have become consultants and advisors. They work for organisations and deal with day to day legal issues of corporate and individuals. In last two decades there has been a noticeable transformation in both the size of the legal industry and the number of lawyers. There have been forces and factors which are changing the way legal industry is lived so far. It seems as if the industry is undergoing a cosmetic surgery to get a more attractive face.
We all are witness to the introduction of Legal Services Act (LSA) 2007, which has brought the entire legal industry under the same roof by putting together the skill set of different professionals including lawyers and non – lawyers like bankers, insurance and financial service providers. It encourages the formation of Alternative Business Structure (ABS) and establishment of such a super store which delivers packages of legal services and other related services to consumer at the same time and same place. While LSA talks about merging the different verticals together to offer consumers more choices, law firms seem little reserved about this but they are open to merge with their direct rivals.
In the current business scenario it is noticed that one law firm buys the other and absorbs its employees, takes its assets and liabilities into consideration and the latter loses its identity and continue working in the name of the former. Sometimes two law firms merge to form a new identity with increased net worth, specialised services, partners, attorneys, more number of offices and clients. As a result the customers get varied services at the same place. Recently we witnessed mergers like Pinsent Masons and McGrigors, Davies Arnold Cooper and Beachcroft, Barlow Lyde & Gilbert and Clyde & Co, Weightmans and Mace & Jones and latest in the row Lawrence Graham and Field Fisher Waterhouse have started merger talks. Inspite of being big players of the legal industry large law firms are facing Increased competition and pressure from the clients to reduce the costs which have made them to go beyond the organisational and geographical boundaries as well. They are taking the services of offshore service providers who are performing the same task at the same quality but at a very low cost. It has allowed them to shed their legal expenditure by 30% to 70% resulting in the increased profit margins also.
On the other hand technology is playing an important role to boost the solo practice. In the past no one might have imagined a day when lawyers advise their clients without even meeting them in person. Technology and internet today has played an important role in making this a reality enabling lawyers work virtually for their clients. It has resulted in offering better rates to clients and flexibility in work to the lawyer.
Considering all the factors I can say that the current legal industry is going through a cosmetic surgery and I am confident that the new face would be more beautiful, attractive and customer friendly which would be beneficial for both clients and the law firms.
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