Momentum versus quality. That’s the question for the upper reaches of the legal industry that is never on the lips of managing partners but probably should be. The industry likes to focus on partnership models, strategies, practices, geographic spread and culture. These are all fine up to a point but as major determinants of success, they get too much air time.
But momentum – well, the impact of that is dramatically, empirically startling in law. When firms have it they are capable of achieving staggering levels of growth and market repositioning.
Momentum can come as focused application of a counter-intuitive playbook – Quinn Emanuel Urquhart & Sullivan, Latham & Watkins, Clyde & Co or Mishcon de Reya. It can come in the form of aggressive expansion via mergers and lateral recruitment, as seen in the emergence of DLA Piper. But look at what firms can achieve if they have it. Quinn Emanuel, for example, was the fastest-growing firm in the Global 100, with revenues growing by 163% in just five years.
Consider London’s top firms during the 1990s, when the combination of following economic headwinds and a full-blooded commitment to globalisation generated startling levels of growth.
Momentum often also creates a powerful virtuous cycle in which the best, or at least better, professionals want to join your shop while prospective clients are attracted by the industry buzz and profile a firm on the up achieves.
And, as impressive as the results are when law firms tap into that gulfstream of super growth, consider the contrast – when firms trudge along little changed from year-to-year. At the upper tiers of the legal profession, a lack of change for most firms in the herd means you are going backwards.
Momentum brings me to Dentons, whose management I met recently. In many regards its strategy leaves me unmoved, but cutting through the jargon, Dentons’ polycentricism or whatever is basically code for momentum. And on that basis, reinventing the law firm as a global consolidator in an urgent hurry makes a lot more sense. You can see for the legacy parts of Dentons that signing up with a global giant determined to get somewhere fast is a more preferable bet than continuing professional life without dramatic motion.
By the same token, as we address this month in our Global 100 coverage, the Magic Circle has to collectively look at how they get back the pace they have lost if they want to secure their place in the global division. It isn’t just having discipline, managerial rigour and quality staff; they have that already. It’s something else.
The argument for many firms for avoiding such a growth strategy is that you sacrifice quality and that is a genuine risk. That said, a number of the most celebrated legal brands of the last 20 years have demonstrated that travelling somewhere fast can be powerfully conducive to raising the bar. Driven growth strategies carry risks but at least they represent a choice and a choice is usually preferable to a decision avoided entirely. Unless you have a compelling case for the status quo you should think about how your firm can get some of that wind in the sails. Quickly.
For more analysis of the Global 100 in 2015 see: Global 100 Overview – Heavyweights