In an era of outsourcing, mobile working and watching the property pennies, the facilities management function can help in a variety of ways
Q Can you offer any tips on how a firm can reduce its dependency on property, both in the UK and internationally?
Tass Patsalides, facilities director, Kennedys: Kennedys was one of the first firms to adopt open-plan for fee-earners, helping us achieve between 98 (regional) and 140 (London) sq ft per member of staff, dependent on location. I’d like to see London drop to around 120, releasing a further 10,000sq ft of space for more fee-earners. That’s a significant contribution to turnover and profit.
Firms have to use their space better, and better IT (document management, remote connectivity and collaborative working) can facilitate this. If you look at occupation statistics you’ll be surprised at what you find. I’d make a guess that at any given time, at least 25 per cent of desks are unoccupied either due to holiday, sickness or working from other locations. Make use of this space through agile working and you can add to the bottom line.
Adrian Jennings, head of finance and facilities, Cripps Harries Hall: Lawyers want a desk to call their own. Take that away and they cease being professionals,they become travelling salesmen, encouraged to be out winning business rather than sitting and practising what they love, which is studying and applying the law.
Lawyers also like paper. They generally prefer paper files to electronic files and these need storing. So, already, we have constraints on how flexible we can be with property. Only a minority of firms are likely to break this dependence by embracing more radical ways of working. This might involve lawyers working as franchisees, dropping into the office to use centralised facilities such as the library.
The first step that law firms took towards greater flexibility was to shed their freehold interests in favour of rented offices. The next step may need to be a bigger one.
Fiona Robb, chief executive, 9 Gough Square: The biggest issue facing us is the high costs of property – our largest overhead alongside employment costs – together with the inflexibility of long leases. Business innovations that would help us in conditions such as mergers and takeovers are unworkable if property is unlikely to be able to be rationalised without significant financial penalty.
Lawyers and barristers have to move to an open-plan environment and desk-sharing arrangements for those who are not office-based all the time. This is the only way to reduce office space requirements – and as an industry we are significantly behind other professional services in this area.
Q When and where will the outsourcing wheel stop?
Patsalides: Outsourcing will always be with us. There is a trend among law firms to outsource and the promises of savings and improved service provisions appear tempting.
But I’d advise caution. First, the mistake most firms make is to outsource a problem area, either because they have been inefficiently managed or are costly or not delivering to the business. Invariably, that problem will not go away and it will take the service provider a great deal of time to turn it around. This is when client and provider end up in conflict. Better to take the hard decisions yourself, restructure and then outsource.
I’m not a big fan of outsourcing, but it has its place and can, when used correctly, raise standards and provide staff with a different, more rewarding career progression.
Phil Page, EME operations director, Reed Smith: We’re seeing signs of the wheel turning full circle. A number of firms are looking to lower cost locations in the UK, with Allen & Overy and Herbert Smith Freehills in Belfast, and in the US. The difference is they are being resourced by their own staff rather than going through third parties.
There are also signs that the total outsourced solution isn’t delivering the service improvements or cost savings that were expected and there has not been a rush to follow suit. It’s about identifying the services that can be provided from a lower cost base.
Jennings: The outsourcing wheel may never stop. Let’s be honest, it’s been more demand- than supply-led and I don’t see the buyers of legal services easing off just yet.
Many believe the legal market has changed for good – we have the ‘new normal’. Even those who don’t think this must accept that things are unlikely to return to precisely the way they were.
Clients have become used to dictating terms, and it’s not just clients who are more demanding, regulators are too. Delivering legal services is now more competitive and complicated. It is convenient for lawyers to have everything in-house, but this needs managing and does not guarantee the most cost-efficient or best quality service. Many non-core services have been outsourced. The next phase is to outsource some legal services.
Where will this end? Potentially not until firms have pared down to a level at which they are delivering only the most specialist services within their niche.
Robb: There are great benefits in outsourcing base services to reduce costs and provide consistent levels of service, provided the outsource partner is chosen with care and the relationship carefully managed. If the only motivation is cost reduction, service will suffer. International work benefits from having a workforce available outside normal office hours to field calls and produce documents at a cost we could not compete with in the UK.
Outsourcing fundamental services such as information, business development or HR functions is much less advisable as you can’t replicate loyalty and experience.
Q What do lawyers really want from their facilities management team?
Robb: Lawyers want things to work and their environment to be comfortable. They don’t want to be distracted or irritated by noisy aircon or shelves that don’t stay up. A good facilities management (FM) team can be relied on to liaise with IT, reception and any other service department to solve problems without lawyers having to think about it. Much of this comes down to personal relationships and knowing individual lawyers and their areas of work so the FM team can anticipate how they can help – with special room set-ups for meetings, for example.
Patsalides: The first thing is to be well-structured and organised, the service we provide should almost be invisible. You achieve this through well thought through processes and procedures, and a team that spends more time thinking and planning and less time executing tasks.
Second, we need to improve the margin, whether through procurement, process and workflow engineering or simply by better utilisation of assets. If your margin is, say, 25 per cent, £100,000 saved out of an operational budget equates to £400,000 of turnover or billing. That’s a lot of hours.
Third, they want an innovative approach to problem-solving. As much as change can be a difficult pill to swallow I believe lawyers want to see creative solutions to problems that make their lives easier and save the firm money.
Jennings: A facilities manager is like a football referee – if he’s not noticed he’s probably doing a good job. Lawyers want office services that work without having to think about them. The best lawyers understand their clients’ business and are able to anticipate their needs. The same can be said of the facilities manager.
However, the facilities manager cannot be all things to all men. This is where communication is important. It’s true that many clients expect a tailored service but in my experience this is in the field of extranets and access to online legal know-how. It’s more an issue for the IT director than the facilities manager.
The FM team can help with trends such as efficient access to archived documents. Having services ‘open all hours’, without necessarily having staff on-site, is another.
Q What are the most pressing issues relating to mobile working?
Page: On the ‘bring your own’ debate it’s a question of data security for me. While everyone wants emails to their own device it begins to mix up data belonging to the firm on a personal device that may not have the same level of security as the one owned and spec’d by the firm. There are all kinds of dangers in mixing personal and private data without the right processes and policies in place.
Patsalides: Changing management culture is the biggest hurdle any agile working initiative faces. Firms are generally afraid of giving staff autonomy. They should realise that law firms are the ideal model for this new working style. Law firms have always managed fee-earners on ‘output’ or billable hours – this practice makes it easy to see how a fee-earner is doing, regardless of where they are working from.
In addition to making remote workers feel part of the team there’s no substitute for being in the office, meeting colleagues and sharing information. It’s important there is a solution in place to enable staff to interact, either through video or online social tools.
Jennings: The IT director says security and compliance; the lawyer says familiarity with tools and ease of access to information. And familiarity with tools means being able to use one’s own portable electronic device. This has spawned a whole industry of experts keen to extol the virtues of ‘bring your own device’. What could be simpler than using your own kit in the office or on the road? Ease of access to information means being able to log on to the firm’s systems and download information onto one’s own device.
This is the point at which the IT director turns a whiter shade of pale. Once privileged client information is allowed to roam the streets, all kind of data protection and security issues come into play. However, it does seem natural for mobile working to evolve in this way. Surely the experts will be able to make ‘bring your own’ work, if they have not done so already.
Robb: Lawyers in the office have access to high levels of support from IT and facilities departments. Mobile workers are much more vulnerable to IT, phone and other technical problems that could render them unable to work effectively.
The value of working closely with a team should not be underestimated. Water cooler conversations are a good way for lawyers to tap into the experience of colleagues. Mobile working is here to stay but extra efforts have to be made to bring lawyers together to transfer knowledge, discuss cases and generally keep in touch with what is happening in the department so they don’t find themselves at a disadvantage when assigned to a case everyone else is up to speed with.
Q How would you characterise the impact on business services teams of the working day being extended by globalisation and 24/7 working?
Robb: It’s a challenge to provide consistent and high quality services 24/7 and not end up working all hours to ensure this happens. There has to be efficient management and delegation in place, and as a head of service you have to learn to trust your team to cover for you.
Liaising with opposite numbers across international offices and time zones can be a challenge and you have to work hard to establish trust and good working relationships. Take every opportunity to get to know your peers better and work alongside them on projects.
Patsalides: Law firms are way behind most commercial businesses in looking at FM from a global perspective. Traditionally, support teams are not deemed important enough to deal with overseas offices, which is short-sighted.
There are several areas where FM can be globalised. If global contracts are put in place for support services, the need to run 24/7 falls away.
Jennings: Business services leaders have long been used to having a BlackBerry in their pocket. They’re already doing what they can to extend the working day, but there are constraints – banking hours being one. So decisions can be taken and promises made, but they may not be put into action until regular office hours come around.
The closer each international office is to replicating the others, the simpler it is to handle time zones. Deals have always been closed late at night. This is not new and there remains a core of clients who like to do business in daytime hours. In fact, people seem to have been in less of a rush to get things done since the credit crunch and subsequent recession. Maybe the 24/7 culture is less of a factor than it once was.