From a successful UK focus to consolidation, LB100 management figures give their reflections on the market
So far so good
‘A number of businesses like us have adopted a strong sector proposition in the UK and that has been welcomed by the market. It reflects a general improvement in the UK economy and those businesses with a strong imprint in the UK market will benefit from that. We have grounds for confidence but the main challenges I see are around the uncertainty that remains at a macro level in a number of economies where we trade. It remains to be seen how clients respond and adapt to the EU referendum in the UK. There is continuing uncertainty in the eurozone, brought about by the position of Greece – I still see that limping along.’
John Cleland, managing partner, Pinsent Masons
War for talent
‘The cycle of increasing pay rates as a tool to attract and retain talent is engrained in the law firm psyche, particularly in a growing economy where the war for talent is fierce. Pay is and will always be important. But, it’s like the leg room battle in the airline industry; it can never be a true differentiator. Law firms increasingly have to think about why people chose to stay with their firm. This means looking at the opportunities for people to develop their careers, it means thinking about the working environment itself and how you build a positive and supportive culture and clarity on strategy.’
David Pester, managing partner, TLT
Battle-scarred
‘Clients have budgets to meet in the same way we have budgets to manage here, so you have to be more creative. If you are operating on a panel for a client you should be more collaborative with the other firms involved – work out how you best deal with that and provide the best resource for the best transactions. That’s not something that is going to stop because the economy has got a bit stronger. If anything, people are going to be more cautious in managing budgets because they are still battle-scarred from their experiences four or five years ago.’
Ray Berg, managing partner, Osborne Clarke
Normal’s nothing new
‘We’ve talked about the new normal. But the run on Northern Rock began in 2007, and Lehman collapsed in 2008 – seven or eight years ago now. I’ve said we are going to stop talking about the challenging conditions as these are the conditions. For our guys who qualified less than seven or eight years ago, this is all they’ve ever known. This is what they do. You have got to work harder to maintain your position, and to improve your position you have to work even harder and do things differently and adapt and keep adapting to what the clients want.’
Bryan Hughes, chief executive, Eversheds
Benign conditions
‘Market conditions have undoubtedly improved; more buoyant economic activity is supporting more transactional work. Set against that background there continues to be a highly competitive market where it is only possible to increase your market share by really delivering value to your clients – not just price but the whole quality and service proposition. The outlook is very positive, we are continuing to see very strong pipelines of work. There was a bit of a pause in some markets pre-election but everything seems relatively back to normal. There was also a little bit of a pause around the Greek issues but again current pipelines are suggesting another positive year of growth.’
Claire Rowe, chief executive, Shoosmiths
Time for change
‘There is enormous opportunity for new inventions with different models and cultures. There is a massive investment in technology and there are brand new areas of law opening up. A lot of clients have come out of the recession with more knowledge about how to source their legal needs from numerous firms as opposed to just using one firm. Change will come through from removal of monopoly and with traditional firms being innovative.’
John Westwell, managing partner, Foot Anstey
Summing up
‘I expect more consolidation; clients will continue to be tough on us. For those of us who are getting the delivery of products right, getting the delivery of service right and using innovation, you will see consistent 5-10% growth with the odd leap where someone has done a merger or a big lateral hire.’
Nick Thomas, senior partner, Kennedys
Economies of scale
‘Our scale has both positives and negatives and we look at larger firms and are slightly envious because some things are easier when you are that big. But being smaller, I know all the partners and perhaps we can move more nimbly. The advantage bigger firms have is that when you make an investment in a new office, for example, with a billion-dollar turnover, a million-dollar investment for a start-up won’t make much of a dent. It has more of an impact on our business.’
Sharon White, chief executive, Stephenson Harwood
Steady course
‘What we’re aiming for is consistent growth, not necessarily spikes in growth. A key factor is diversity in the business, enabling you to deliver long-term consistent profit. We’re obviously emerging markets-focused and sector-focused and both have enabled us to grow steadily.’
James Burns, senior partner, Clyde & Co