It is such a great spectator sport to see those lemmings going over the white cliffs of Dover – the evangelical enthusiasm of UK law firms for European mergers, takeovers and greenfield sites.
Certainly some form of representation in Europe’s key financial centres is necessary in some markets and for some clients – particularly in banking and finance.
But different clients and marketplaces require different strategies and for the many firms which do not get their thinking straight it could be a case of marry in haste, repent at leisure. So why is such a large proportion of middle-tier firms joining the lemming-like rush?
They claim it is in the name of “serving clients better” – that stock marketing-speak answer to every question. But the real test, of course, is to find out what clients want – and the best way to do that is to ask them.
The market research is clear. For UK plcs a fairly consistent message emerges and that is supported by research commissioned by Wragge & Co.
As Stephen Williams, Unilever’s general counsel and joint company secretary, said: “What I want is local excellence. I am not interested in a second rate, second division tie-up around the world.” (The Lawyer, 17 January).
Indeed, it seems that the heads of legal at these companies either already know their preferred firm in a given jurisdiction or they work with their UK lawyers to select the best firm in each country for the job.
As we all know, the quality of European firms is inconsistent. Many firms have tied up with niche practices in Europe, many others with firms of dubious quality, yet selecting lawyers across Europe should be a case of horses for courses. Hence the wise words of Williams.
Or as Tim Bye, head of legal at British Midland, said: “All I’m keen on is getting good, cost effective advice and I am not sure that global firms are the best way of achieving that.”
So why do the lemmings keep on going over the cliff?
In true lemming style it looks as if they are simply following the others. A case of egos and expansionism perhaps? Or do the management teams simply want to be seen to be “doing something”?
The trend bears an alarming similarity to the rush of regional firms in multi-site operations throughout the 1990s – a trend which ran equally contrary to the available research about what clients wanted.
A final word from Nigel Boardman, head of corporate at Slaughter and May. He has identified clients’ resistance to their lawyers “investing” huge amounts of money in massive strategic programmes.
What clients want is client service. As he put it: “Good quality people remain more important than globalisation or global strategies – and the clients couldn’t care less as long as you provide a good service.”
It is no coincidence that like Slaughters (England’s most profitable firm and last year its fastest growing), US firms have done their thinking. In contrast to many of their UK cousins they are highly selective about which cities and which market sectors they invest in. They have no ego issues over size and spread.
This sentiment would doubtless be echoed by the world’s most profitable firm, Wachtell Lipton Rosen & Katz, which features nowhere in the league tables for head count or geographical spread.