In recent months, as Knox outlines, “a growing number of traditional law firms including Eversheds (Agile) and Allen & Overy (Peerpoint) are establishing operating units in Asia.” Additionally, Corrs Chambers Westgarth and Rajah & Tann are among others who’ve launched similar initiatives in Asia. Knox sees these new entrants “as re-affirming what we already know – the traditional law firm model is under serious threat and success comes from putting client’s needs first.”
Traditional BigLaw business model is seen as an impediment to innovation
Knox cited George Beaton, a Partner in Australia’s Beaton Capital, who explained to the Financial Review recently that some traditional law firms are seeking to rapidly implement some form of NewLaw initiative but are struggling under the weight of outmoded partnership management structures incapable of rapid change in a disrupted legal market. “As few as 1 in 10 traditional big law firms will emerge as winners based on profitability in the next five years,” Beaton outlined, “as innovative new law firms with dramatically lower costs and targeted offerings proliferate and take advantage of disruption.”
Knox also cited “A recent Australasian Law Practice Management Association (ALPMA)/LexisNexis study entitled: “Preparing Australasian Law Firms for A Digital, Divergent, Differentiated Future”, launched at the recent 2015 Australasian Law Practice Management (ALPMA) Summit” in Australia — which concluded that “the attempt to innovate within a traditional partnership business model will likely prove a very difficult thing to do.”
BigLaw depth, breadth of experience seen to be a value-add
BigLaw sees itself in an adventageous positon in the provision of seconded legal talent. As Eversheds Asia managing partner Stephen Kitts told Tom Brennan of The Asian Lawyer last month: “The delivery of [NewLaw style services of seconding lawyers within the general counsel`s offices] “by a law firm, rather than a legal outsourcing company like Axiom Law or Asia Pacific-focused AdventBalance, will be more attractive to prospective clients” because of the global scope of practice and number and experience of firm attorneys. Eversheds has just this month launched its contract lawyer division, Agile, in Asia, as Brennan reported,
‘We have made a lot of lawyers very rich over the last number of years,” Kitts said, “but they need to realize that the gravy train is about to stop.” Knox responded by telling Brennan that “[BigLaw firms adopting the NewLaw business model in Asia] are smart firms. They’re not getting into this business because it’s shrinking. They’re getting into it because they know it’s what clients want,”
The future of the NewLaw business model in Asia
The adoption of the NewLaw business model is a reflection of the recognition that for many clients, secondments, lower fees and attention to client needs is in ascendance in the Asia-Pacific region. As well, there is an increasing diversity of business models focused on providing legal services in Asia.
Not just NewLaw, but Legal Process Outsourcing (LPO) companies and legal startups are all competing for work among the region`s growing base of consumers of legal services. Too, the success of legal services startups Dragon Law, LawPath and LegalVision reflect the likelihood that we`ll see many more unique approaches to a legal services market predicted to double in size between 2013 and 2022.