HR is pivotal to success in a shifting legal environment

Joanna Parker

It will be the ability of the business to align its people and processes with the demands of a fast-changing world that will separate the winners from the also-rans in a competitive legal services market.

The tough economics of an ever-more sophisticated and demanding client market, with fixed fees increasingly becoming the norm, will mean fundamental shifts to firms’ resource models. Most obviously, in the world of the fixed fee, partners will need a better understanding of how to price work and, having secured it, how to deliver profit within that price. Pricing strategies to secure work at the best price-point and ­efficient delivery to secure sustainable profit are the core skills that will be required.

There will be a heavy emphasis on HR strategies that build project management and process abilities, as well as significant investment in improving fee negotiation skills, so that the best possible fee basis is struck at the outset.

Fixed fees will also signal the rise of a competency-led model for career ­progression with the demise of associate lockstep in most firms. Getting the ­competency model right to ensure the firm recognises and rewards the behaviours that will build a strong and flexible workforce will be a significant HR challenge.

The march of technology will promote efficiency improvements that could only be imagined a few years ago. However, the twin entry-barriers of significant financial investment and changed management ­challenges will prove huge impediments. Realising the potential of technology will require different skills and a change in the HR mix, with an increased number of
non-or less-qualified staff handling the more straightforward parts of a transaction, and the input of more-qualified (ie more expensive) personnel being restricted to the complex elements only. These new resource arrangements mean HR professionals will need to design a wider spectrum of career paths and remuneration structures quite different from the linear models followed by traditional solicitors-in-training. Creating this diverse bundle of career paths will ensure that law firms have the broadly based skills required to succeed, but there will also be the need to manage the internal tensions that will inevitably arise between professionals on different tracks.

Increased availability of effective and credible outsourced legal providers will allow significant tranches of work to be undertaken outside the UK at a fraction of current costs and without any impact on quality of product or service. While this is a nascent market for early adopters at the moment, it seems that the penetration of the UK legal sector by legal process outsourcers more generally will continue inexorably. This will bring about far-reaching changes to the skills that are needed within the typical firm and the ways in which solicitors are developed through to partnership.

The demands placed on partners have also increased significantly over the past decade. A further acceleration should be anticipated in the one to come. Simply being excellent at the law is not enough to ensure career success at a modern firm – commercial pressures now demand ­partners who excel in building strong client relationships, are able to develop business across a broad front, can manage complex projects and large teams of lawyers, as well as being able to answer the complex legal questions their position demands.

The HR challenge is to ensure that ­current partners have the requisite skills and understanding to succeed in such a demanding and multifaceted role, as well as putting in place the learning and ­development building blocks for firms’ leaders of the future.