international law firm

Report: ‘HSF bets growth on Asia’

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The Australian‘s weekly Legal Affairs section is reporting (subscription required) today that global law firm “Herbert Smith Freehills will seek to more closely integrate its Australia and Asia practices.

Sorry to be blunt, but what!?!

According to the Lawyers Weekly website, HSF officially merged on 1 October 2012 to open as the “largest fully integrated law firm in Asia Pacific based on number of lawyers“.

That was 3 years ago.

This begs the question: are all of the recent global law firm entrants to Australia going through the same issues?

My guess here is “yes”. Even though nearly all of them (arguable K&L Gates used US-Australia as its strategic reason for opening in Australia) made specific mention of using Australia as a springboard into Asia, pretty much none of them – to my knowledge – has a specific liaison Business Development Manger person (or higher) located in Australia who assists with joint business development activities.

As I understand it, there may be cost related issues involved in this (who pays for the resourcing – Australia or Asia). There may also be personnel issues involved.

Who knows; but the short answer is that for the life me I cannot understand how 3 years or more (in some cases) on from when the global firms arrived in Australia they still don’t seem to:

  • have dedicated Asia-wide practice and support teams
  • be able to tell you the number of referrals across jurisdictions (inbound and outbound)
  • be able to tell you which partners are referring work [championing] across jurisdictions
  • be able to tell you how many referrals are going to other firms within the jurisdiction where they have an office – particularly where there may have been a relationship prior to the merger (in Australia’s case, would you like to take a punt that Gilbert & Tobin gets referrals from international firms with an on the ground presence in Australia?)
  • know which of their clients are referring work to them across multiple jurisdictions.

To me, this says that both the back-end and front-end operations of the merged firm are still working in geographic and practice group silos (which they most certainly would appear to be from today’s article).

Don’t get me wrong, it’s great that HSFs is seeking to more closely integrate its Australia and Asia practices. I hope other firms follow suit. I’m just frustrated that this initiative is probably about 2 and half years late!

Forget the Gadens merger, the big news today is Olswang’s announced ‘Revenue Share Scheme’

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Pretty much all anyone involved in the Australian legal sector will read about in the industry news today will be the reported three way tie-up between Global behemoth Dentons, Australian law firm Gadens and Singaporean firm Rodyk & Davidson, which is still subject to a partner vote but you assume is pretty much a done deal.

Although this may have a profound effect on the Australian legal market in years to come, in much the same way as the K&L Gates / Middeltons merger has hardly set the sector alight, I somehow doubt this merger will too.

There is, however, another piece of news being reported this morning that could very well have a massive effect on the local market – and that is the news that Olswang has established a ‘Revenue Share Scheme’ that it hopes will incentivise staff (it is being reported the scheme is open to all employees at the firm, from partners through to business services staff) to refer clients to the firm through a referral bonuses scheme that will pay an employee who introduces a new client who subsequently spends more than £20,000 in the first year instructing the firm, 10 per cent of the instruction fees in the next year.

I worked under a scheme very similar to this is Asia just after the Asian Financial Crisis and I can vouch that provided you get your conflicts worked out (because trust me, this leads to a lot more potential conflict situations), then this type of scheme can be very incentivising.

While I doubt this type of scheme will be introduced widely here in Australia too soon – after all, why do we get paid salaries, I can see this becoming more prevalent and certainly having a more profound effect on market practice globally.

It’ll be left to the test of time however to see whether – in five years time – everyone is discussing their 10 per cent bonus or the Gadens-Dentons tie-up!

BTI’s The Mad Clientist: New Business for the Taking: Corporate Counsel Shift Work Back to Law Firms

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In private practice and looking for a good news story to read this weekend? Then BTI Consulting Group’s The Mad Clientist may well just have it.

According to his latest blog post,

“After 4 years of feverishly bringing work in-house [following the GFC] corporate counsel are reversing course.”

Is that cries of joy I hear ring out?!? If so, the news only gets better. Because not only are in-house counsel shifting work back to law firms, but the type of work they are sending out is the sweet spot big ticket matters. Indeed, according to BTI’s study of 322 corporate counsel, “Chief Legal Officers expect a tripling of bet-the-company litigation, increases in class actions, and substantially more securities litigation.

But before you go clambering over your other partners to get on the phone to your in-house counsel contacts, keep in mind that (1) the study was done in the USA, and (2) BTI is of the opinion that:

“The big winners will present themselves to clients as strategists and discuss risks and exposures before the matters ever start. The bigger winners will discuss prevention, potential settlement postures and learn about the business risks posed by the new matters.”

Putting that aside for a second though, we can but hope that the tide is turning here and that the pendulum has once again swung back in favour of private practice. But in order to be best placed to take advantage of this development, you need to be working through your client plans (including engagement and communication actions) now so that you can be ready to take full advantage of whatever 2016 throws at you!

Until then, “have a great weekend!”

A ‘Failure To Deselect’?

A Failure To Deselect

Read a fantastic rant by Barrie Seppings – Director of Creative Strategy at wordsearch, the world’s leading marketing network for architecture, property and real estate – on the Firebrand Ideas Ignition Blog yesterday titled “Copywriters: What the %$@#* are you saying?“.

Barrie’s post get my approval merely for quoting Don Watson, Paul Keating’s former speechwriter, brilliant book Death Sentence – and if you have ever written a tender and not read Don’s book, please do!

Anyhow in his post Barrie makes mention to something I had not heard of before and which he terms a ‘Failure to deselect‘, being:

“… a fear that unless we say every single thing we can possibly say about a brand or product, we therefore fail to communicate the full range of the brand’s attributes. And we therefore fail as marketers. So, to avoid failure, we use all of our words to try and say all of the things.”

Now, swap out ‘brand or product‘ and ‘marketer‘ and replace it with ‘law or regulation‘ and ‘lawyer‘ and does this sound familiar to you?

It certainly did to me. And in this time of ‘doing more for less‘ in law, it got me to thinking: are we actually suffering from a ‘failure to deselect’?

Is an iTunes store for professional services the next big thing?

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Today the Australian Financial Review has published a very interesting article (‘iTunes store for professional services‘) that states:

“Global professional services giants will invest hundreds of millions of dollars over the next 18 months to build iTunes-style repositories of software-supported services that can be distributed to clients through a digital shopfront anywhere in the world.”

going on to state that: “[KPMG] is throwing $US200 million to $US300 million ($425 million) at populating this repository with “disruptive technology assets”“.

All sounds a bit far fetched doesn’t it?

Or does it?

We already know that a number of leading law firms in Australia have developed client facing apps since Gilbert + Tobin’s Telco Navigator app was awarded ‘Services to the industry’ in the professional services category at the 2014 Communications Alliance and CommsDay (ACOMMS) Awards.

Most recently this has included the very informative K&L Gates Hub platform, which is described as being:

“a digital destination for timely insight on critical issues at the intersection of business and law.”

So while law firms may not be throwing $US200 million to $US300 million at this development, there’s little doubt that iTunes (as well as Google Chrome App) may well play a significant role in the way law firms distribute their thought leadership in the future.

And while there is absolutely nothing wrong with this, it made me recall another quote I read this morning to the effect that in the future it may well be the case that your firm’s differentiating factor could be as simple as having the human touch.

Which would you prefer: to be well known, or well paid?

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This week saw the publication of Acritas’ report of the ‘Best Known Firms the World Over, 2015‘.

For regular readers of this blog, my views of reports of this kind should be pretty well known by now (hint: I don’t hold them in much stock).

However, this year’s Acritas report goes a step further:- not for who is in the report, but for who isn’t.

And who might they be?

Well, in Slaughter & May and Quinn Emmanuel, only two of the most profitable law firms in the world.

Which rather goes to show that either:

  • (a) “detailed telephone interviews of 1,059 heads of legal departments, their deputies or chief operating officers at 1,048 companies at randomly selected companies with gross revenues of at least $1 billion” means that neither of these firms is that well known, and/or
  • (b) there’s very little correlation between being well known and being well paid.

Given the choice though of coming top of a league of well known law firms or top of a table of most profitable law firms (profits per equity partner), I know which I’d choose.

3 ways you can grow your book of business today

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It’s very much been a story of doom and gloom in the Australian legal marketplace of late. Demand is down. The Aussie Dollar has fallen through the floor and seems to keep going. It’s nightmare and has been for some time.

As someone who advises law firms on business growth strategies, all this doom and gloom can be down right depressing. If, that is, you let it.

As for me, I prefer to talk things up and I enjoy looking around for the opportunities rather than dwelling too long on the negative. With that in mind, here are three ways and places you could be growing your book of business today:

  1.  Thailand

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Rohini Kappasath (handle @TalkingAsia on twitter) recently tweeted that there are 180 Australian companies – large and small SMEs – operating in Thailand who are looking for growth and guidance.

When I questioned Rohini where these numbers came from, he told me (vid DM) they were provided by DFAT (Department of Foreign Affairs and Trade).

Think about that for a second: 180 Australian companies operating in Thailand who are looking for growth and guidance. I wonder how many of these companies are currently represented by Australian law firms? Having lived in Thailand for 12 years myself, I’d hazard a guess not too many.

Massive opportunity going begging here.

  2.  Malaysia

Headline in yesterday’s The Star Online:

“Domestic F&B players strive to expand into Australia”

with a lead paragraph that reads:

“The domestic food  and  beverage (F&B) sector is striving to expand into the high-value Australian market as reflected from the participation of 18 Malaysian exhibitors at the Fine Food Australia 2015.”

18 Malaysian exhibitors at the Fine Food Australia 2015 with,

“Ninety-five business meetings with over 80 potential business partners were arranged by Matrade for the Malaysian companies during the event”

and not a single law firm in sight (from what I can see).

Massive opportunity going begging here.

3. Inbound M&A

Headline from yesterday’s Australian:

“Foreign takeovers tipped to surge”

with the following graph:

inbound M&A

Other than, “massive opportunity going begging here”, not really sure I need to add anything to that!

So if you practice law in Australia and you are wondering what you can do about your ever dwindling revenue stream, all I can say is the work is out there: you just need to go looking for it.

* did you notice how I didn’t need to mention China once in this post… …quite clever that really.