Change was the over arching topic of the LS19 event up in Manchester last week and the presentation given by Chris Bull of Kingsmead Square was a brilliant addition to the various offerings put forward. Having been a senior figure at a variety of top 100 law and big four accountancy firms and now consulting for them, Chris is in a unique position to be able to comment on a whole range of topics after sitting on both sides of the fence and chose 'funding' and 'structure' as the two central themes.
After encouraging members of the audience who were at law firms to forget the 'If it ain't broke don't fix it' and 'This is the way it has always been' approaches to business, Chris gave an interesting stat about how law firms are now structured.
'Less than 40% of law firms are now true partnerships'. This was news to me and a lot of people that were present, especially when 14 other options as to how a Law firm can be run, were put forward. What is apparent, as outlined by Chris, is the fact that due to these varying options now available, all firms should periodically review the right structural, financial and funding, model available to them. The following three considerations help with this review process:
1/ What are the main investment requirements (especially for tech, marketing, growth/hires) and can these be funded from existing sources?
2/ Are external funding sources required and what are the best options (IPO, Debt, PE)
3/ Is the current governance model effective and is any structural change required?
Interestingly, this type of review will also help address and in some cases, combat two other worrying points made later in the day about the lack of senior female figures within law firms and the fact that too much talent in general is leaving the industry due to the difficult path to partner.
It wasn't lost on the room that in a world where the buyer and client have evolved at a rate of knots, the law firms that look to keep pace will be the most successful in the future.