The recruitment of specialists is seen as crucial for long-term success in a transformed Irish market.
How much longer can the Celtic Tiger roar? This question is increasingly being asked as Ireland continues to beat all economic predictions.
But, with the top 25 law firms reporting activity up by an average of 20-30 per cent and making plans to recruit some 150 lawyers over the next year, there is little sign of any downturn.
Indeed, many now believe that Ireland's economy has fundamentally changed and that the good times will continue to roll but at a slower pace.
Frank O'Riordan, managing partner of A&L Goodbody, says the question is not when the boom will end but whether the current levels of growth are sustainable.
Shadows on the horizon include European Monetary Union (EMU) and the possibility of inflation. “What's driving the economy is a mixture of low interest rates and high growth rates. It's unrealistic to think we'll maintain both,” says James O'Dwyer, managing partner of Arthur Cox
He believes that there is a significant risk of inflation, with the housing market in particular giving cause for concern. The government's deal with the unions on wages, Partnership 2000, is also up for re-negotiation and this is likely to see calls for wage levels to be increased. “By joining EMU we have lost two main factors from our control, interest rates and devaluation,” says O'Dwyer.
Jim Power, chief economist at the Bank of Ireland Group Treasury division, backs this up. “In my view it is not at all clear that EMU membership is in the best interests of the Irish economy at this particular time. The key reservations emanate from the UK position and the cyclical strength of the Irish economy.”
Power points out that, in an EMU world, “Ireland plc will become exposed to an unprecedented level of competition and a flexible and competitive economy will be needed to survive and prosper in a new environment”. Despite all this, the prognosis is “quite favourable,” says Power, predicting an average 5.5 per cent growth in gross national product in the next five years.
Unperturbed by the risks, the biggest Irish law firms are putting plans in place for expansion. The “people” factor is one of the biggest management issues which face Irish firms as the market becomes increasingly specialist.
Michael Benson of Dublin and London recruitment company Benson & Associates, which specialises in recruiting lawyers for the Irish market, says that Irish law firms need specialist lawyers as never before.
“The market is changing. Firms realise now that having top specialist lawyers is the best way of competing for business.” He says his company has been asked to recruit mainly in the commercial and corporate arena but that there is also a demand for commercial property lawyers, IP/IT, EU/competition and employment lawyers.
“With lifestyle becoming a major factor in the life of lawyers, it is relatively easy to attract top players in London back to Ireland these days, particularly as the calibre of work is now not much different to that in London,” says Benson.
“All firms have a recruitment issue,” says Frank O'Riordan, whose firm is looking to take on 25-30 new recruits.
“Even when the market was relatively flat, we never stopped taking people on.”
He says that his firm had put career packages in place so that “if we train someone and their career plateaus, we have a whole range of imaginative packages to keep people. Our philosophy is to grow organically but we also recruit externally.”
McCann Fitzgerald managing partner Ronan Maloney says his firm has a “fairly focused recruitment strategy”, which recruits on a global basis.
In the past year, the firm has recruited Barry Devereaux, who headed Clifford Chance's corporate finance department in Singapore for 10 years. Devereaux will develop corporate finance and management buyout work for McCanns.
Maloney says: “We have done well in the recruitment stakes and have done so in the face of offers from other firms.”
He says four solicitors from the UK were shortly to join the firm's Dublin office and that the firm's view was that “if you develop the people, the work will follow”.
Maloney says his firm was looking at its overall operations. “We are currently taking stock and having a good look at what we've been doing,” he says, adding that the firm was not compiling a masterplan as such.
“However, we are looking at how we relate as groups. We have taken a very hard look at our information technology, personnel strategy and financial management in relation to working capital.”
Maloney says the firm had created specialist departments and was ensuring that it had “business rounded technical experts”. He says the firm had invested considerable amounts of money on internal training.
Matheson Ormsby Prentice is also looking to take on 20 or so recruits, doing this via lateral hires from the other firms as well as from the accountancy firms.
It has new US-style offices and an ambitious programme in place to build up its practice in a variety of areas. Managing partner Donal Roche maintains the firm is going places.
Some may say that the path of lateral hires is a high-risk strategy, but Roche is confident that Matheson Ormsby Prentice can pull it off.
“Our strategy in the next five years is to further improve our quality of service. We want to develop specific practice areas where we see strategic long-term developments.”
Areas the firm has identified include tax, information technology and securitisation work.