Revenue is big challenge for law firms
Safety in numbers isn’t necessarily the equation for law firm growth.
Some 56 percent of law firm leaders nationwide believe headcount is a requirement for their continued success but 36 percent disagree, according to an Altman Weil survey.
Asked about net change in lawyer headcount in 2012, 54 percent reported an increase in equity partners in their law firms last year; 65 percent said the number of nonequity partners grew; and 59 percent said they had a net increase in partner-track associates.
“Growth is not dead, but size alone is not a safety net,” Altman Weil Principal Tony Clay said in a prepared statement. “Firms are beginning to think more strategically about growth – trading up to improve profitability, rather than bulking up to drive gross revenues.”
Increasing revenue was their biggest challenge over the next two years, respondents said, followed by generating new business, firm growth and profitability. Delivering value to clients ranked eighth, mentioned by just 5.6 percent.
“This is very troubling,” Clay said. “Law firms that do not put client needs at the top of their priority lists and align themselves with those needs misunderstand what is driving the forces of change in the legal market in 2013.”
Altman Weil, based in Newtown Square, Pa., surveyed 791 U.S. law firms with 50 or more lawyers in March and April 2013; 238 responded, including 37 percent of the nations 250 largest firms. A regional breakout wasn’t available. But Pittsburgh managing partners of out-of-town law firms talked about growth plans and challenges in a Business Times roundtable.