Experts in different fields have their own opinions about how mid-sized law firms can overcome the problems arising from continued market consolidation. Financial experts will refer to sound financial planning. Customer service specialists will tell you that client care is at the very heart of success. There are other experts and other equally valid opinions out there, too numerous to mention. All of these opinions are correct. There is no magic formula which enables firms to succeed, but an amalgamation of different, often competing, factors.
Legal Eye’s area of expertise lies in assisting law firms with their compliance requirements, be that strategic, operational or regulatory and it is investing in these, as well as the other key areas referred to above, which will help mid-sized law firms embed their position within the current and ever-changing legal market giving them firm foundations on which to flourish and grow notwithstanding the heavy consolidation that continues apace.
Operational – quality standards, Lexcel, CQS etc ensure fee earners have a rigorous risk management framework within which to operate. With clear reporting structures, sound supervisory arrangements, adherence to policies / procedures and an endemic system of file reviews, allows senior management to drive the strategic direction of the firm, content in the knowledge that each fee earner is working to the same high standard and each client receiving the same quality of service. Negative trends are highlighted enabling corrective measures to be implemented prior to damage to a firm’s reputation. It also demonstrates the firm’s commitment to managing and reducing risk and ultimately reducing what, for many firms, is a significant annual burden – PI insurance.
Regulatory risks are those to be considered as a result of the regulatory framework that impacts on the business. Keeping up-to-date with these regulations, ie: Code of Conduct 2011, Data Protection Act etc ensures the firm does not fall foul of the SRA’s radar.
Finally, strategic risk is arguably the most important element of risk management in enabling mid-sized law firms to overcome problems arising from market consolidation. However, without careful attention to the aforementioned areas, all the strategic planning will be for nothing. Strategic planning requires considering the viability and success of the business having regard to such factors as the current economic climate, the socio-economic profile of the area and ensuring there is a sound financial strategy, effective marketing to maintain and improve the firm’s position, business continuity planning (tested) and succession planning etc.
There is no guarantee for firms of any size but for mid-sized firms, sound risk management principles will stand them in good stead for years to come.
Legal Eye Ltd