Despite constantly popping up in conversation over the last year or so, the “new normal” still hasn’t normalized, has it?
In that time, one thing has become more and more apparent—the COVID-19 pandemic didn’t really start many new trends, it mostly just accelerated some already in place.
This week, we’re going to take a look at how three trends, in particular, have affected law firms: talent, real estate, and technology (and yes – these trends affect most other industries as well).
Let’s look at each of these trends individually and how they interact with each other as well.
The Great Resignation & the Battle for Talent
It’s not anyone’s imagination.
“The Great Resignation” is very real and no single industry has escaped its effects, including law firms.
In 2021, Reuters reported that there was a staggering 150% increase in job openings at law firms compared to the start of the pandemic. This has forced firms’ hands, causing a cascading effect of having to turn away clients, offer expensively enticing compensation packages, or even relax certain hiring standards they once had.
“Part of this may be a blessing in disguise,” Joseph Moreno, general counsel at SAP National Security Services, told Bloomberg News. “Firms and companies are putting less focus on the pedigree of an applicant’s law school and more on their accomplishments,” Moreno noted, “I’m hoping that will continue.”
This translates to a need for firms to make the most out of the available billing hours for the attorneys on staff.
There’s more focus than ever before on maximizing efficiency and time spent on high-value tasks. Efficiency comes in many forms, but one avenue that firms have consistently found to deliver high ROI is legal process outsourcing, which is further enabled by an investment in technology.
Firms Will Continue Heavy Investment in Legal Technology
Ernest Hemingway wrote that one goes broke two ways, “gradually, and then suddenly.”
Change often operates by those same rules, especially when it comes to technology. The COVID-19 pandemic made said changes not only imperative but urgent.
Nobody was more surprised than the law firms themselves with how rapidly they adopted technologies for remote work and increased digital collaboration.
In 2022, business processes only became more automated. Leveraging technology-powered services, like Access Unify™ Active File Management, reduces or eliminates the need to be physically in the office looking through onsite storage, trying to find records managers to locate the active files needed, or hiring couriers to deliver files. It also empowers existing staff to focus on higher value tasks that affect the firm’s bottom line more directly.
By extension, this freed up valuable time up and down the chain of command enables the entire staff to focus on delivering the best user-centric client experiences they can while still being focused on practicing law. And bill-back capabilities add additional value because the service can inherently pay for itself.
This trend is likely to diversify the opportunities available at law firms as well as provide additional collaboration and support that lawyers need to do their jobs well.
So who exactly is going to be going into the office?
Massive Shifts in Real Estate Investment
According to surveys conducted by Gartner amongst larger corporations, the state of work hybridization is anything but definitive. Just 5% of enterprises interviewed plan to be remote, and another 5% will be fully in person, leaving the vast majority of corporate America somewhere in the middle.
With law firms specifically, research by McKinsey says the time people spend in law offices will decrease by 12% which could translate to a 15 to 25% decline in space required. According to the 2021 Report on the State of the Legal Market, 75% of lawyers prefer to work from home compared to a mere 37% of lawyers who desired to work remotely before the pandemic.
Depending on where the firm falls on the spectrum of wishing their employees return in person to the office or opting for a hybrid approach, these two data points could have a drastic effect on their real estate investment.
Law firms are still the leader in most metropolitan areas with far more space per employee than any other industry and rely heavily on private offices (and multiple-sized ones) rather than open workspaces or even single-sized offices. While many industries will be trying to increase the space between employees, law firms are likely to have the opposite situation.
This is not a new development though.
Even before the pandemic, it was a trend that began in the mid 2010’s according to Damla Gerhart, managing director of workplace strategy at CRBE Group, Inc. Many firms proactively seeking opportunities to reduce costs in real estate investment; so, much like investment in technology, rethinking real estate is yet another trend COVID accelerated.
With budgeting season upon us, strategy for real estate investment will go hand in hand with both technology and talent investments. Supporting a reduced or distributed workforce will inform how a firm plans to spend related budget. After all, an active file room is an expensive use of real estate if it’s just used for paperwork rather than generating revenue like another attorney’s desk space would. Other firms choose to divest the space entirely for cost savings.
Law firms will capitalize on the changes they need to make at the intersection of these interlocking trends.
For instance, if a firm is suffering from a shortage of staff, the smart move is to invest in technology that supports hiring staff from anywhere so the talent pool becomes exponentially larger, while making the existing team more efficient. At the same time, they can recoup their investment by shifting their office layout to maximize the use of the space they have and even consider downsizing.
Likewise, if they are moving toward a hybrid model of work with a distributed legal team, technology will become paramount to keeping the team’s collaboration intact. Active case files stored in a file room in an office is no help to someone halfway across the country. Technology provides the added bonus of incremental digital transformation without disrupting the firms’ core business operations.
If your law firm is looking to free up your legal team’s time, Access is committed to ensuring that your organization has reliable, secure, and innovative solutions to drive your business forward. Over 50 dedicated developers, managers and leaders are committed to crafting industry-leading Access Unify offerings that meet your specific needs.
To learn more about the future of our evolving business environment and what’s on the horizon in information management, register to attend our upcoming virtual event hosted by a panel of seasoned executives: Out of the Box Live: CEO Perspective – Finding Opportunity in Our Evolving Post Pandemic Business Environment.