The increasingly fragmented legal market is shaping the office of the future
In which ways are the new offices law firms are moving into meeting the challenge of a disaggregated legal offering?
Karl Warmbold, facilities director, DWF: Property, people and IT tend to be the most significant costs incurred by law firms. Now more than ever, because of increasingly disaggregated legal offerings, it is vital that facilities, HR and IT are strategically integrated to ensure that a firm is using its entire property portfolio as effectively and efficiently as possible to help deliver the firm’s strategic objectives.
We now operate across 12 locations in the UK and Ireland and are deliberately leveraging off of our national footprint to ensure we can deliver services to clients as cost-effectively as possible. Process-driven work does not need to be done in premium office space in the City – more often it can be delivered just as effectively and with no negative impact on client service from locations with a cheaper cost base. This means, for example, that in London we operate at a ratio of 1:3.5 partner to fee-earners whereas in our regional offices the ratio is more like 1:7.
Nick West, general manager, Axiom London: At Axiom, our physical footprint is designed in concert with our mission to deliver the most value possible to our clients. Let’s face it, clients – or legal consumers – do not really care where offices are located, how they are decorated or how big (or small) they are. Clients care about the work and the value delivered through that work. They care about quality, service and efficiency. So we have created a physical framework that allows us to provide uncompromised service and value without inflating the client spend via large hourly bills – or often any hourly bills at all.
At Axiom, we have stripped the cost structure and overhead costs from our offices, with our insourcing lawyers working either on-site with clients or virtually from technology-enabled locations. This eliminates not just the often-expensive office walls but the walls altogether, while eliminating the overhead costs traditionally built into the resulting inflated hourly billing models. As a result, clients get the service they demand and expect of their provider in a more efficient manner. Equally as important, an on-site presence helps to integrate the lawyer with the client more meaningfully. As such, the lawyer becomes more familiar not just with the tasked legal work, but with the client’s broader mission and corporate objectives. This combination of economic efficiency and strategic integration results in a higher-value service offering.
That’s not to say the law firm of the future is office-less. We believe in the combination of locations with minimal overhead and on-site integration together with larger centres operating across a multitude of more cost-effective global locations. These centres are equipped to tackle larger outsourced work but take advantage of locations with a lower cost base and a large population of experienced and educated professionals with legal, technology and project management backgrounds.
John Drake, chief operating officer, Bird & Bird: One of the most important considerations is ensuring mobility and flexibility of arrangements within the office so we are prepared for the evolving nature of the legal profession.
In a modern law firm there is greater interaction between lawyers and other functions, such as IT and business services. We need to provide a functional environment that reflects the way we work. We wish to encourage mobility and flexibility, enable people to move around and facilitate cross-working with different teams. We also need to ensure our new premises and infrastructure meet the increased need for remote working, for example from clients’ offices.
Gary Youngs, global property and facilities director, Norton Rose Fulbright: The newest offices at law firms are moving into meeting the challenge of a disaggregated legal offering in a number of ways. There has been a general shift towards centralised business service and support functions, which can help to create common operating processes, procedures and standards. Among firms generally there has been a rising trend towards outsourcing and off- or near-shoring, and service delivery partnering in recent years.
How does the latest breed of offices help engender flexible working?
KW: For our new space in London we have avoided the usual ‘chicken farm’ linear layouts and are effectively creating ‘villages’ – an eclectic mix of space and functions geared to different uses that allows for people to effectively work, relax, interact and collaborate.
It is an open plan, collegiate space with client lounges, similar to an airline’s business lounge with work hubs and space for clients to touch down. We have more than 400 agile workers – those who do not have a dedicated desk, including the managing partner – and we are designing our new London office so that while we are only taking about 24,000sq ft, it will be able to cater for 600 of our people, which is hugely space-efficient.
The layout encourages people not to own space but to use the best space option that meets their daily needs, whether that’s a hotdesk, a meeting room or the bistro. An £11m investment in technology is helping to ensure that flexible working is a fully functioning reality for our people. Recently we have been working with a technology partner on a solution that we think is a first for the legal sector and enables employees to print documents from mobile devices to further support a truly mobile workforce.
GY: As well as offering flexible working hours or the ability to work from home, the latest breed of offices considers design in order to facilitate flexible working. Collaborative work spaces – lounges, staff restaurants, breakout zones – and extensive support and peripheral work spaces can assist. Technology and devices are key – we use a mix of bring your own device; wi-fi and video conferencing, for example.
JD: We are working with architects to help us develop the optimal legal workplace. We based our approach to new premises on affordability, flexibility and client experience.
We need to ensure the appropriateness of space for the variety of needs across different practice areas and make this space readily adaptable to meet constantly changing business needs. Other key factors are efficiency and effectiveness – providing a workplace that allows collaboration but also provides space for contemplative work, and that continues to provide a mentoring environment for staff.
NW: The old structure – with an office for every lawyer and a secretary outside every door – is a dinosaur at best and egregiously wasteful at worst, benefiting neither the lawyers nor the clients they serve.
With regards to the latter, the new office, with hot-desking and mobile centre functionality, allows a law firm or legal services provider to house more talent in a significantly smaller footprint. Those savings are not just a boon for the firm – at the most successful operations, the savings are passed along to the client.
Equally important are the benefits of flexible working to the lawyers. The New York Times recently ranked law as the second-most sleep-deprived profession, just behind in-home healthcare providers. Anyone who has worked in BigLaw can understand why – associates’ physical presence in the office is key to generating billings and has been a long-held symbol of the pyramidal pecking order – they leave when partners leave and not a moment before.
A flexible-working arrangement frees the lawyer from these office shackles. Lawyers are encouraged to work in the location that is most productive and conducive to that work, unburdening them from the symbolism of office late nights or all-nights, and allowing work to be done in the most efficient manner possible.
By embracing smaller, flexible spaces, removing office walls and leveraging the most current technology, we have created a more egalitarian, casual, and ‘fun’ work space.
What is the impact on issues such as the configuration of desk space, security and fee-earner integration?
JD: The demands of client and shared space are increasing. We will be aiming to offer a more intimate client experience, where clients can come and work with us in a secure environment. We have recently been certified with ISO 27001:2013 for our London and German offices. We are committed to ensuring the highest standards of information security which is managed in a dynamic and flexible way.
GY: There are cultural benefits – with more collaborative space, people are encouraged to work together and there is less cellularisation. In fact, connecting in general is important and reflected increasingly in design. For example, considerations such as whether central stairs punch through the core to allow departments to connect more visibly and easily. Flexible furniture systems are considered increasingly too.
KW: A high-quality working environment is critical to the engagement and motivation of employees, regardless of their specific role. We have always operated open plan working environments because we find it encourages interaction across operational and legal teams, service lines and sectors.
No one has their own office, not even the managing partner. Instead we have various break-out rooms that anyone can use. In terms of security we apply the same high level of awareness and operate a consistent security policy across all locations. Having said that, the Walkie Talkie building, as a high-profile City landmark, has been built with additional security measures although these do not relate to the workforce per se.
NW: The congenial, egalitarian and eclectic culture born of the new type of working space has greatly contributed to employee satisfaction rates that are consistently higher than industry norms. The culture creates satisfied lawyers, which in turn creates less turnover, which in turn creates longer/deeper client relationships.
From a facilities management point of view, what have been the biggest issues created by the increasing disaggregation of legal services across a firm’s entire office network?
NW: Security and community. Disaggregation of legal services and the virtualisation of services inherently pose security concerns in an industry that relies so significantly on confidentiality and privileged communication. Technology can be a firm’s best friend and a client’s worst enemy. That is why it is critical that the firm invests in cloud-based technology architecture equipped to handle not only the intricacies of technology-enabled legal work but the security concerns of that work too.
Although the cloud allows for work-sharing across disparate global locations in ways that could not have been foreseen even five years ago, it cannot be a substitute for community. Firms providing a disaggregated legal service offering will have to work even harder to foster a sense of community among employees and to encourage collaboration and a sense of team.
KW: Knowledge exchange has probably been the biggest issue. We have addressed this by investing heavily in IT systems, enhancing our internal mail networks to allow even swifter exchange of documents that conform to guaranteed client service level agreements; installing the most advanced multifunctional devices (MFDs) for scanning documents; and investing in on-line collaboration tools and state-of-the-art video and audio conferencing.
GY: The biggest challenges created by the increasing disaggregation of legal services is ensuring the consistency of processes, procedures and service standards across fee-earners. Firms need to ensure they maintain the agility to meet short-term business demands and service partners need to have genuine global service capability.
Has office security risen up through the facilities manager’s agenda with the increase of lower-cost regional centres?
KW: Security has always been, and continues to be, high on our agenda across all of our locations. As a responsible employer it is important to safeguard our people and of course any intelligence relating to clients and client matters. The biggest change we have seen in security is in required levels of IT security as cybercrime has become more frequent and more advanced.
NW: Information and physical security is a key focus for the management teams in our centres of excellence, as we know it is also a key concern for our clients.
Regional delivery centres are set up as flexible delivery spaces, able to adapt to client’s unique security needs. Some client teams have a designated area within the open-plan space, and others operate in a dedicated, access controlled area.
Axiom’s centres of excellence (COEs) are compliant with the internationally accepted standard for security, and as such operate in controlled environments that include securing confidential information, restricting access along business requirements, secure document destruction, and maintaining segregated and secured logical processing instances and periodic audits of the implementation of Axiom’s security policies. Results of the audits are reviewed formally at the executive level. All COEs have in place business continuity plans that are tested at least annually.