Law Firms Branch Out Beyond Lawyers in Bid to Beat Out Rival Advisers

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Faced with competitive pressure from consulting firms and others, old law firms try new tricks

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“The law profession, traditionally, has been fairly traditional and not super fast in change,” said Zachary Coseglia, an attorney at Ropes & Gray LLP. “I think law firms are slowly realizing that our clients desire more than just traditional legal services.”

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Mr. Coseglia was involved in setting up the R&G Insights Lab, an analytics and behavioral science consulting practice attached to the firm. Among other offerings, the group helps clients craft compliance training to outperform slide deck companies, which typically provide their employees with a droning statement of dos and don’ts.

That team enlisted a Stanford University-educated doctor of social psychology to help inform the behavioral science behind the work—an unusual fare for any law firm, let alone 150-year-old ropes—and recently has hired a journalist to assist in his storytelling efforts, Mr. Coseglia said.

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The result is more engaging and thought-out strategy and training, and with a scientific following among employees, the ability to measure whether efforts to develop a compliance-oriented culture actually work, the firm says.

“We went out and we looked for people who had that experience who could bring a completely different perspective, a career outlook to the table,” said Mr. Coseglia. “We really look, every one we’ve hired, to find people who are naturally creative and have a disruptive sensibility.”

Elliot Portnoy, chief executive of law firm Denton, one of the world’s largest law firms, said client demands and competitive pressure prompted his firm to look beyond traditional offerings of litigation and regulation-focused legal services.

“Customers were increasingly coming to us with a problem they needed to solve and they really didn’t care much about how we solved it,” said Mr. Portnoy. “Often they were looking for something that went beyond the traditional tool kit.”

Dentons has attracted clients from outside the legal discipline to provide the desired services. For example, it employs journalists, law enforcement officers and intelligence personnel to help create a risk report it makes for clients and firm employees. Last year, it launched Denton Global Advisors, a multidisciplinary advisory firm that advises its clients on geopolitical risk, crisis management and other areas outside of normal legal practice.

The firm has also forayed into complex technology products, taking stakes in compliance software companies. Dentons has a regulatory compliance software manufacturer, Libryo Ltd. and provides a software product that continuously collects intelligence on potential regulatory risks.

Another large law firm, DLA Piper, has developed an in-house litigation analyzer powered by artificial intelligence that looks at data sets of litigation histories to predict whether a particular claim may be made using large stores of data. How can it appear? Due to uncertainty from the risk of litigation. The tool was developed by a DLA Piper lawyer who went back to school to obtain an advanced degree in data science.

Right now, the tool is being used extensively to predict the outcomes of clients facing action, a class of litigation that includes the majority of claims related to, for example, asbestos exposure. This tool can use past results to predict, for example, what kind of figures a particular plaintiff’s firm might settle for, giving the firm a more solid analysis than it would otherwise.

The firm benefits in negotiations, said Lauren Brown, a partner who chairs DLA Piper’s dispute exercise. He said the firm has considered trying to adapt the tool to draw on anonymized data sets from more than one client with litigation experience, and expanding it to other areas—for example, it’s potential compliance. Can monitor and identify risks.

“We are getting fair compensation for the technology that we are making as a snap-on to the legal services we are providing,” Mr. Brown said.

Mr Portnoy of Denton said the move to make one law firm something else could face resistance from lawyers. But he suspected that his firm faced less rebellion in the ranks than some rivals because the firm positions itself as a challenging brand, he said. He added that lawyers looking for a more “stable” environment are welcome to go.

With firms booming, the common crutch among lawyers stuck with a technical challenge — “don’t look at me, I just went to law school” — didn’t cut it for long, said Stephen Reynolds, a partner. The law firm Baker & McKenzie LLP.

“Customer tolerance for this is really thin,” said Mr. Reynolds, who has a background in software development. “Lawyers and law firms are becoming more open to bringing in people from other disciplines – we probably don’t do it all ourselves.”

write to Richard Vanderford at [email protected]

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