Back To The Future - Obelisk Support · WHITE PAPER | Back To the Future: Reshaping law Firm Culture 5 introduction The future of legal work is changing, and along with it, how work

WHITE PAPER | Back To the Future: Reshaping law Firm Culture 1

Back To The Future:Reshaping law Firm Culture

The issues facing your firm and how culture change is the solution

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Table of Contents

Foreword

Introduction

What are the Issues?I. Millennials Are Shaping the Future of WorkII. A Talent CrisisIII. Robots and Lagging Legal TechIV. Inflexible WorkV. The Big Four VI. Women in Law, Cont’d

The Pillars of the Future Firm CultureI. Flexible Work SpacesII. The Lawyer-PreneurIII. Smart Legal TechIV. Mind (Re)Set

What’s Next?

References

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AbstractWe examine the business benefits for why UK law firms should significantlyinvest in changing their culture in order to improve talent retention, ensure long-term growth, and become future-proof. We will identify key issues facing firmstoday and explore the pillars of future firm culture, as part of our new efforts towork with firms.

methodologyThis paper reviews current reports, surveys and various off-line and on-lineliterature on the future of work both in the UK and globally. As well as looking atthe legal industry specifically, we draw on best practices from leaders acrossmany industries in order to synthesize and present a comprehensiveperspective on the current and future state of legal work.

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Foreword

Cherie Blair CBEHuman Rights Barrister, Lecturer and Writer

My adult life has been defined by several roles, each with itsunique challenges and rewards. I have been a barrister and QCand established a thriving chambers and law firm; I am thefounder of a charity and sit on the board of several others; I havebeen married to a Prime Minister, lived in number 10 DowningStreet and dealt with all that this entailed. But, of course, themost important, rewarding and challenging role that I have beenblessed with, is that of being a mother to my four children.

Throughout, I have been fortunate to be able to continue mywork and balance my professional and home life thanks, in nosmall part, to a strong support system and a tolerant family. I amnot saying that it wasn’t hard; the mythical ‘work-life balance’ isincredibly difficult to find and its fragility makes it even easier tolose. Like many women, I have faced criticism for being aworking mother from colleagues, employers, the press and, evenfrom other mothers. Whilst there have been numerousdevelopments in the legal profession since I was first admitted tothe Bar, the obstacles facing working mothers sadly remainmuch the same and this, I believe, prevents too many womenfrom reaching their full potential. Fortunately, there are glimmersof hope in the form of those forward-thinking organisations thatare revolutionising the legal world, levelling the playing field andenabling us all to thrive.

Many of the larger law firms still use centuries-old business andorganisational models that are just not relevant in today’s world,upholding barriers to true gender equality and work-life balancethrough rigid and archaic traditions that place the emphasis onface time, rather than quality of work. Such practices leavemothers (and fathers) unable to enjoy parenthood at the same

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Foreword

time as effectively fulfilling their commitments as lawyers. But for women, the barriers don’t stop there. Younger women also face the assumption from current or potential employers that they are ‘bound to get pregnant sooner or later’, as if this is a negative thing and their work life will be over! And, of course, there’s the dreaded Pay Gap, which, quite frankly, I cannot believe we still have to talk about in the 21st century...

The research presented in this paper is both valuable and long-overdue. This succinct, accurate and insightful study focusses on the desperate need for a cultural shift in the Law. A fostering of new norms, priorities and practices is critical if we are to diversify the workforce and enable those who do not fit the ‘lawyer’ stereotype to succeed. We must transform the rigid way that law firms often operate to make space for fresh mindsets, different working styles and original ideas. We must embrace the contribution that the younger generation, people from all classes and walks of life, individuals from diverse cultural backgrounds, and, of course, women and mothers can bring.

Making these changes will benefit everyone. Why would we risk missing out on the next great legal mind simply because the need to collect a child from school means someone cannot work the excessive hours traditionally expected by law firms? Should our colour, class or gender prevent us from being great lawyers or great parents? Should a woman be excluded from reaching partner simply because she took maternity leave?

Something has to change in order to enable women who want to be excellent lawyers as well as parents, and to work how, where and when they can, in order to get the best results at work and at home. The work done by Dana Denis-Smith and Obelisk Support is an important step in helping us to understand and achieve these desperately needed changes. As a profession, we simply cannot afford to waste a single talented and dedicated person, let alone an entire gender!

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introduction

The future of legal work is changing, and alongwith it, how work will get done. The role of firmculture will be more significant than everbefore, driven by a new generation of solicitorsthat will be the most demanding one yet,expecting diversity on all fronts – of people,workspace, technology and wellness.

The legal industry continues to experienceseismic changes as pressure mounts on allsides: the plethora of new technologies; theexpansion of multidisciplinary practices, suchas PwC and Deloitte (the Big Four); theemergence of US firms into the UK market; andthe growing disruption of legal change-makersoffering fresh solutions to legal work.

These trends are not without impact. Althoughnearly 90% of Top 100 UK firms achieved some

level of fee income growth in 2018, profitmargin erosion has continued as many firmsstruggle to contain staffing costs. Indeed,nearly 30% of firms reported a decrease inprofits in 2018, on top of 48% from the previousyear. This, coupled with Top 100 firmspredicting a decrease of 0.1% in fee income forthe 2019-2020 period, provides a grim futureoutlook.1

While it may be too soon to herald the death ofthe traditional law firm model, what is clear isthat it is time for a change.

We have reached a critical moment. Andfundamental action is needed to future-proofthe shape and operation of the firm.

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“They always say time changes things, but you have to actually change them yourself.”- Andy Warhol

Photo courtesy of Pawel Czerwinski

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Millennials Are Shaping the Future of WorkIt’s time to wake up and smell thevegan gluten-free matcha latte:Millennials are the futureworkforce. Defined as a cohortborn between 1981-1996,Millennials currently make up 400million of the worldwidepopulation,2 surpassing Boomersas the largest demographic of theUK legal profession.3

Despite being routinely teased foreverything from being consideredlazy, overtly PC or allegedly beingvery fond of avocado toast, thereis no denying that ‘Millennial Think’has infiltrated all aspects of workculture:

What are the Issues?

People: Millennials expect thediversity of their colleagues toreflect that of their personal socialspheres, going beyond the basicsof demographic diversity in searchof a cultural richness of thoughtsand attitudes.

Upskilling: Millennials are focusedon upskilling and learning on thejob. They understand that it isnecessary in order to keep up withthe speed at which industry ischanging.

Space: Millennials are used toworking in Starbucks and wanttheir workspace to have the sameflavour. Meaning, they prefer aless formal work environment, lotsof tech, and some fun perks.

Collaboration: Millennials prefercollaborative working structures.They need their huddle spaces tobe able to share content, co-createand communicate with remoteparticipants.

Technology: Millennials are digitalnatives. They grew up whiletoday’s technology was alreadyhappening and expect theirworkplace technology to be asentertaining and easy to use asthose they use every day in theirpersonal lives.

32% 29% 22% 13% 4%

25-34 35-44 45-54 55-64 65+

Demographic of the UK Legal ProfessionPercentage Breakdown by Age

SRA 2017 3

“It’s no longer a case of employees adjusting to their work; it’s about the work adjusting to them.”

Padraig CotterThe Irish Times 4

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What are the Issues?

In-House. Lawyers areincreasingly abandoning privatepractice and the long haul to theHoly Grail of partnership,preferring to work in-house wherethe environment is more business-like, tech-savvy, and conducive toa better work-life balance. Today,20% of lawyers now work in-house, a number that has morethan doubled over the last 15years.3

With salaries for in-housesolicitors now comparable to theirprivate counterparts, going in-house offers greater workflexibility and efficiencies such aslowered-to-no constraints onbillable hours, faster routes topromotion, and more diversity andinclusion among colleagues.

Entrepreneurialism. Why arelawyers going in-house?According to KPMG’s 2018 GlobalCEO Outlook, ‘agility is the newcurrency of business’ and smallbusinesses have this in spades.9

With 99.3% of all private sectorfirms in the UK being SMEs, it’s nowonder that the entrepreneurmentality is taking over.‘Employees in small businessescan make decisions at a differentpace and as a result, largercompanies are trying to mimicthis,’ says Snorre Kjesbu, VP TeamCollaboration Devices, Cisco.10

Robots & Lagging Legal TechAfter talent retention, the third andfourth biggest threats to growthperceived by Top 100 law firmsare cyber threats (82%) andtechnological advancements(63%).1

A growing number of law firms,both large and small, are puttingAI systems to use,11 with some48% of UK firms havingimplemented some form of AItechnology, and 41% with theintention to do so in the nearfuture.12 Although AI technologyadoption is happening, it’s doingso at a slow pace, as many firmsare holding out until its costadvantages over outsourcingimprove.13

But time may be running out. Thebombshell report by the WorldEconomic Forum that went viral in2018, predicted that machines willdo 42% of all labour by 2022, andmore than half of it by 2025,14

should be somewhat concerningeven for the biggest AI sceptics.This means that massiveeconomic change is afoot, and it’s

A Talent CrisisIn this crowded and competitivemarket space, firms face a toughjob recruiting the right candidatesfrom the industry’s pool of eliteprofessionals. After Brexit, thebiggest fear of firms for futuregrowth is a shortage of talent.1

Personnel turnover in law firms,especially with young lawyers, isat its highest level ever – a trendthat costs Top 400 global lawfirms roughly £6.8bn annually.5

Burn Out. It’s no secret that in law,long hours are worn as badges ofhonour, and they have been fordecades. Today, with the rise oftechnology, the idea of ‘work allthe time or you fail’ has becomethe norm.

Burnout is on the rise: 23% of lawfirms believe it’s increasing,6 with96% of solicitors reporting thatthey experience negative stress,and 19% saying that stress is‘extreme’ causing mistakes orburnout.7 As a result, lawyers areincreasingly exiting the industryaltogether to pursue other optionssuch as helicopter skiing or scuba-diving.3

£33-42 Bn

Annual Cost of Mental Illness to UK Firms: 9

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What are the Issues?

Inflexible WorkCompanies that offer flexible workare known to have increasedemployee retention, moremotivated and engaged staff, andaccess to wider talent pools whenrecruiting.10 However, according toa recent report by Hydrogen Group‘UK Sector Snapshot: Legal,’ thereare still some gaps that need to bebridged.16

The report found that only 52% offirm solicitors were workingflexibly to some degree, comparedto 63% of in-house lawyers, and66% of UK professionals.Furthermore, nearly 60% of firmsdo not make it standard practiceto offer information about flexiblework, while 81% of lawyers saidthat they would actively look for

flexible work options beforejoining a new company.16

But what does this ‘workingflexibly to some degree’ actuallylook like? A handful of firms arecurrently offering agile workingoptions, such as, work from homefor one day per week, hot-desking,and working remotely on an ad-hoc basis.17

However, firms’ approaches tothis are restrictive. Many cap theirflexible working policies toworking from home one or twodays a week, and rather thanallowing employees the freedomto choose how, when, and wherethey work, the majority are beinggranted a piecemeal offering.18

about to get personal. People areactively building machines toreplace human work, all in thename of cost-savings andincreasing efficiencies.

Ultimately, there will be a shiftaway from automated “lower level”tasks towards soft “higher level”work. The report adds, “skills, suchas creativity, originality andinitiative, critical thinking,persuasion and negotiation willretain or increase their value, aswill attention to detail, resilience,flexibility and complex problem-solving.” 10

Of those firms using tech,Millennials are not happy with howit is being implemented. There is aperceived gap between consumerand business tech, with the latterfailing to match the former interms of ease-of-use andentertainment value.10 Millennialsare also far more likely than BabyBoomers to say that they feel liketheir company requires them touse too many technology tools.15

Lawyers Are Working Flexibly to Some Degree

I work remotely at least once a week.I want to work remotely at least once a week.

I have flexible start / finish times.I want flexible start / finish times.

I always work at my employer’s place of work.I want to always work at my employer’s place of work.

Hydrogen Group 2016 Report 16

Forbes 14

“By 2022, 54% of employees will require significant upskilling.”

34%64%

21%64%

31%11%

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What are the Issues?

C-Suite: Thanks to deeperrelationships, and an ability to gainlegal business via access to theentire corporate C-suite, the BigFour are institutionally advantagedin business development.19

Larger Resources: Players like theBig Four have the resources,financial power and motivation tobe agents of change. They alsohave the size and worldwidepresence to make an impact, andmost importantly, they have themoney to invest and acquire.20

Women in LawWhile gender equality continues tobe championed at board level,progress remains slow.

In a recent report, for the first timein history the number of workingfemale solicitors in England andWales exceeded that of men, at50.1%, reflecting the decades-longInflux of junior women to theprofession.22

Yet despite the advances at thejunior level, female representationat the partner level has beensluggish. Over the last five years,it's the Top 51-100 firms that havemade some headway, with 24%reaching partnership. The Top 50,however, are trailing behind atunder 20%.1

In short, there are plenty ofwomen lawyers, but they’re justnot reaching the top.

More shockingly, a recent reportinto the future of legal practice byBPP University Law Schooldetermined that it will take until2037 for women to achieve paritywith men at a senior partnershiplevel.23

Then there’s the notorious genderpay gap. In the latest survey ofTop 25 UK firms, the averagegender pay gap came in at 20%.Not so bad, given that most bankspublished gaps in excess of 40%.However, only nine firms includedpartner earnings in their publishednumbers – of these, the gap roseto almost 60%.24

The Big FourWith a deep understanding ofprocess optimisation, a firmcommitment to technology, andbroad expertise, the Big Four(Deloitte, E&Y, KPMG, PwC) arecertainly well equipped to meetthe needs of the future legaldepartment.

In reality, are four accountingfirms set to become the biggestdisruptors in law? Well, yes.

Innovation: Clients want a holistic,business-solution approach tolegal problems. Decades of auditprice pressure have taught the BigFour how to deliver, and invest intechnology and innovativeprocesses that disrupt and deliveron business objectives.19

Pricing: The Big Four are driving afundamental shift in the pricingmodel. By providing packagesthat bunch together a number ofservices for a cut cost, they foregodwelling on the P&L in the spirit ofbetter servicing the client.20

60%Among uk firms that included

Partner earnings

9%Among uk workers

In general

ons.gov.uk 25

Bloomberg.com 24

2018 Gender Pay Gap

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The existing discourse on employeesatisfaction at law firms in the UK primarilycentres around hours spent at the officerelative to salary. A recent survey of 2,000trainees by Legal Cheek revealed that the totalhours spent working broadly correlated with afirm’s score of work-life balance – and itsremuneration.27 A win for the juniors.

But good pay and benefits just aren’t enough.In a survey by the Association of LegalAdministrators, staff turnover in 2017increased by 28% from 2016 – despite basesalaries that rose by an average of nearly 9%,despite bonuses that jumped by 30%, anddespite significantly improved benefits.28

Summarised best by one junior lawyer: ‘Thebalance is good, for a law firm. But that isn’treally the appropriate comparator.’ 29

When trying to benchmark the future of workfor UK law firms, it’s time to look beyond themeasurable industry numbers, and insteadfocus on closing the employee happiness gap:what is offered to them; and what is beingoffered outside of the UK legal industry.

“The balance is good, for a law firm. But that isn’t

really the appropriate comparator.”

A Junior Lawyer 29

The pillars of the

future firm culture

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The Pillars of the Future Firm Culture

This non-fixed mindset meansintegrating new tech with:1. Agile work solutions that go

outside of the office2. Dynamic office spaces that

encourage collaboration3. Office tech tools that are as

fun, as they arefundamental to gettingwork done

1. Out Of Office

Flexible working removes locationfrom the work equation. It puts anend to the idea that work is whereyou do it. It’s time to get out ofthe office.

If a staggering 83% of workerswould consider leaving a firm if itdidn’t offer work-from-home10,then firms need to wake up andstart considering all out-of-officework options, like job shares,homeworking, part-time roles, co-working and annualised hours.Then decide what’s the best fit fortheir business – and the solicitor.

The biggest trend in this aspect isco-working. WeWork is less thana decade old and yet hasemerged as the world leader inco-working, ranked as the thirdmost valuable startup in the USafter Uber and Airbnb.31 Thesecret to this success? Creatingenvironments that are conduciveto productivity, innovation andcreativity... with the right lighting,the right snacks, and, crucially,the right people.

Those who have alreadyintegrated agile working into theiroperations have enjoyed boostedproductivity, increased staffloyalty, and reduced absenteeism.Perhaps most significantly, byprojecting an image of anemployer with family-friendlyflexible work schedules, itimproves the ability to recruit toptalent.31

Pillar #1: FlexibleWork SpacesThe future of work is about whatwe do, not where.

Flexible working embraces boththe physical and digital workspaceby empowering people to workwhere, when and how theychoose, with the main goal ofmaximising their productivity atthe firm. But flexible working ismore than just a way of working:it’s a business model orphilosophy, and when doneproperly, it can reap someformidable rewards.

Beyond just offering hot-deskingor a laptop to work from a client’soffice, flexible working puts thefocus on where it counts: servingclients’ needs. By encouragingteams to work collectively, ratherthan looking at the old barometerssuch as face-time, it promotes thedelivery of improved results.

“Flexibility should be the default position; in other words, the manager has

to argue why the employee cannot have it.

It’s about not having a fixed mindset.” 10

Photo courtesy of James Brittain

AirBnB, San Francisco

Photo courtesy of Emily Hagopian

Deloitte, Toronto

“There are fourgenerationsworking together in the workplace. The need for the work settings to be flexible enough for all of the different requirements was our design focus.”Debbie Baxter, VP Corporate Real Estate, Deloitte Canada.37

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2. Dynamic Spaces

For those who still need to go intothe office, it’s time to rethinkspaces and how they’re used.

From quiet contemplation, tocollaborative teamwork, tocreative idea-building, in one dayalone, an employee could gothrough multiple working styles.And Activity-Based-Working (ABW)is a dynamic way to think abouthow this work gets done.

First coined in the book, The Art ofWorking by Erik Veldhoen – aDutch consultant, ABW wasinitially piloted by Dutch insurancegiant Interpolis in the nineties.34

The idea is that if a suitableworkspace is chosen according tothe task that needs doing, it leadsto an improved outcome. Soessentially for ABW to work, firmsneed to create dynamic officespaces.

And leading the way in creative,forward-thinking office design aretoday’s technology giants. These

are spaces that were conceived toinspire creativity, promotecollaboration, and attract the bestglobal talent. They have funkymeeting rooms, an open kitchen,slides and contemporary art,which are all small in design, buthuge in driving the popularity ofthese Millennial meccas.

With average talent retention ashigh as three years at Google, fiveyears at Apple, and seven years atCisco,34 certainly some of this canbe attributed to their workenvironments.

A fine example is Google whichhas claimed the top spot onGlassdoor's annual list of the ‘50Best Places to Work’, as well asFortune magazine's annual list of‘100 Best Companies to Work For’,for multiple years. Thoughgenerous employee perks,opportunities for career growth,and innovative culture do also playa key role.36

Courtesy of Google Zurich

Here’s a law firm with animpressive list of accolades.Voted as the ‘Best Law FirmTo Work For’ for the past twoyears by more than 18,000US solicitors on Vault, and‘Best Law Firm for Women’by Working Mother and Flex-Time Lawyers, California-based O'Melveny & Myers istopping leaderboards left,right and centre.32

Why? Remote-work, flex-timesolutions, reduced hours andjob sharing are all offerings ofthe firm’s CustOMMizeprogramme, while Bridgesallows staff to take a two-year sabbatical to exploreother interests while stillremaining an O’Melvenylawyer.

As one associate stated,‘O’Melveny truly is not a ‘face-time’ firm, and I love it. Noone tracks where you are, orcares when you are in theoffice, as long as you get yourwork done.’ 32

O'Melveny & Myers Menlo Park, California

Photo courtesy of bcci builders

The Pillars of the Future Firm Culture

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The Pillars of the Future Firm Culture

3. Office Tech Makeover

Out of office work, ABW andother flex work solutions –none of them would be possiblewithout the integration of smarttechnology.

In fact, collaboration technologyis becoming as important asflexible work spaces. Estimatedby Frost & Sullivan to be 30million huddle spaces globally,the growth rate is expected tobe in the double digits.3

However, the key toincorporating new businesstech successfully is ensuring itmatches the richness and ease-of-use of today’s consumertech. Millennials want theirworkplace apps to satisfy themas much as their personal appsdo, inspiring them to thinkinnovatively and work smart.‘The question about work techshouldn’t just be, “Will it work?”Rather, we should ask “How willmy team feel when using this?”’says Alex Shootman, CEO atWorkfront.15

A shopping list of flexibleworkspace tech tools will need toinclude virtual reality meetingrooms, instant messaging(favoured by 62% of UK workers15), digital whiteboarding, livecontent-sharing, audio technologythat blocks out sounds (say, of adog barking), and smart AI toolsthat offer contextual informationfor meeting attendees.

When Deloitte decided torenovate their Toronto office in2017, their ideas were sofuture-facing, many top designfirms were left scratching theirheads. But after severalrounds of pitches, the finaldesign was awarded to anAustralian firm, Arney FenderKatsalidis.

And this was a mammothundertaking involving thesmooth movement of 5,000employees from six differentoffices into one shiny new 16-floor flexible workspace;replete with modular wallsystems, mobile powersupplies, collaborative areas, aStarbucks, wellness centre, afull concierge service and100% unassigned seating (noteven the CEO has a privateoffice).37

Deloitte Head OfficeToronto, Canada

Photo courtesy of James Brittain

Workers use apps suchas Skype and WhatsAppon a daily basis in theirpersonal lives. Digitalconnectivity is how weall live, so it should alsobe how we all work.Offering smart officetech tools that are partof agile working shouldno longer be seen as aperk, but rather afundamental to howwork gets done.

Collaborative space

65%

Real estate costsavings

35%Work stations

25%Configurations of work settings available 18

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1. Upskilling & Retraining

A lot of resources are currentlyinvested in the training of newrecruits, with firms offering avariety of initiatives such asmentorships, special interestclasses, and financial support forLLMs and MBAs. But, when itcomes to the continued trainingand upskilling of solicitors on thejob, this is a road less travelled.

Outside the legal world – there’splenty of evidence of the ROI forbuilding learning & development(L&D) programmes for employees.

According to a recent study byIssuu,39 companies that spendmore than average on upskillingper employees (£300 and up) aretwice as likely to say their staff arehighly satisfied, and neverreported a retention rate of fewerthan six months. The report addsthat companies with strong L&Dculture exhibit success factorssuch as using new technologiesand dedicated training ROItracking.

How are companies investing intheir L&D?

Leadership Skills: Regardless ofindustry, leadership developmentis the most popular area ofemployee upskilling, and wasreported as the top priority of 25%of companies surveyed in theIssuu report. This trend was evenstronger amongst companies whohave grown in the last financialyear, of which 63% rate it as theirtop priority. These primarily tookform as workshop seminars, on-the-job training, and coaching byexternal providers.

Soft Skills: When collaborationbecomes compulsory for a projectemployees must utilise their softer‘human’ skills (empathy, humility,deference) that help people worktowards a common goal.Combining the results of two 2018surveys, one by the WorldEconomic Forum40 on FutureWorkforce Strategy and the otherby LinkedIn41, it was reported that92% of C-level executives ratedsoft skills as more important thanhard ‘role specific’ skills.

Pillar #2: The Lawyer-PreneurLawyers have always beenentrepreneurial. But with the trendof solicitors moving in-house, andwith the growing pressure of lawfirms to compete with SME’s, thefuture lawyer will need to expandits roster of skills to adapt to anenvironment that is morebusiness-oriented and tech-savvy.

Firms will need to invest in thefuture lawyer-preneur by:1. Upskilling solicitors and

partners on the job2. Treating lawyers as strategic

partners

The Pillars of the Future Firm Culture

“We need our lawyers to imagine, create and then make different recipes for how we do existing and

new types of work.” John Craske, CMS 38

92%consider having soft skills equal to or moreimportant than possession of hard skills

O F C - L E V E L executives polled

Top soft skills identified as critical by C-suiters:

65%Leadership

64%Communication

55%Collaboration

Blog.Cake.hr 42

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2. The Lawyer as aWith solicitors flocking tocommercial and not-for-profitcompanies with an entrepreneurialenvironment where they feelempowered and stimulated, it’stime to have an in-house attitudetowards employees.

In-house lawyers alreadyunderstand the benefit of beinginvolved at various stages of alegal process. ‘There are alwaysnew issues, which means there isalways an opportunity to learn. Notwo days are the same,’ saysCharlotte Lakin, an in-houseparalegal at Live NationEntertainment.3 The main benefitof this approach is that the lawyerfeels both stimulated and

engaged, and the lawyer’s adviceis more well-rounded andbusiness-driven. ‘Fifteen yearsago, in-house lawyers sat in theproverbial backroom andremained distant from thebusiness,’ says Ben Foat, LegalDirector at the United KingdomPost Office. ‘Now they are seen asstrategic business partners,whose work is core to thebusiness.’ 3

Increased engagement is the bestindicator of whether lawyers feelempowered. A recent report byAon, representing nearly 10,000legal UK professionals, suggeststhat there are still many gaps thatneed to be filled.43

The Pillars of the Future Firm Culture

Virtual reality (VR) training isnot a distant possibility insome far-off future. Now beingtested and deployed bycompanies such asMcDonald’s, AlzheimersResearch UK, and the NationalAcademy for Rail, expertsbelieve that this is the futurefor upskilling. With the mainadvantage of hypotheticalsimulations, VR training allowsthe employee to imaginescenarios in a visual manner,ask questions in real-time, andexplore soft skills such asempathy and decision-making.

Farmers wanted to promptcritical thinking around thedecisions that claimsadjusters make in their role –before they’ve even entered acustomer’s home. By addingVR technology to their L&Dprogramme. ‘(Learners) reallyappreciated the opportunity tobe able to slow down, think alittle more about the decisionsthat they were making, andalso be able to ask questionsin the moment,’ says JessicaDeCanio, Head of theUniversity of Farmers. 39

Farmers Insurance London, UK

Photo courtesy of Samuel Zeller

50% most engaged departmentsThe Top

have an average 33% less attritionHRMagazine.com 43

Strategic Partner

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According to the report, only52% of professionals in the legalsector say they felt engaged.Partners are the most engageddemographic in the legal sectorat 66%, while associates are themost disengaged at only 43%engagement. Trainees came insecond at 59%, followed bybusiness services and partnersat 56%.43

Only 54% of associates felt theywere empowered and hadautonomy at work, compared to81% of partners. Just 40% feltthey had been provided withstrong career opportunities, incomparison to 65% of partners.Additionally, only 32% said theyhad experienced firm leadershipin contrast to 53% of partners.43

Giving associates a strongervoice within the firm,strengthening their account-ability in client relationships,would help to bridge theengagement gap in the sector,the report suggested.

The Pillars of the Future Firm Culture

The lawyer is no longer someone you need at a specific point intime, for a specific set of circumstances. They must be seen as astrategic partner that is both driving and resolving the businessneeds of the firm, and its clients.

AllensSydney, Australia

One way to tackle the issue ofgiving solicitors a sense ofempowerment is through thecreation of independent thinktank groups.

Top tier national law firmAllens recently rolled out a100% in-house multi-prongedstrategy designed to driveinnovation, increase theirsolicitors’ sense of autonomy,and respond to the changingmarket demands.

Their Innovation Undergroundproject encourages juniorlawyers to actively collaboratewith senior lawyers and staffacross the firm. Their A-Plusgroup rounds up some 70external business and knowledgedevelopment professionals towork alongside lawyers. Thethird prong, LawLab, works withclients on legal technology.

‘Sometimes with large-scaleprojects you need a specialistproject manager. Clients havefound it to be fantastic,’ saidManaging Partner, RichardSpurio, to The Australian BusinessReview. 44

Feel engaged

Associates

PartnersFeel empowered Feel provided with career

opportunities

43%

66%

54%

81%

40%

65%

HRMagazine.com 43

Legal Professionals Surveyed in the UK

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The Pillars of the Future Firm Culture

Pillar #3: Smart Legal TechTechnology is reshaping allaspects of life and work, and thelegal industry is no exception.While UK law firms areincreasingly recognising the needto evolve their technologysolutions, their employees aregrowing increasingly frustratedwith its progress.

What once seemed like a wish-listof irreconcilable demands is now aprerequisite for survival in themodern legal landscape. Asmillennials reach an age wherethey rely more on legal services,many are discovering that lawfirms aren’t meeting thoseexpectations.

The future in legal technology willendeavour to:

1. Embrace work managementtechnology with a millennialsensibility

2. Adopt a holistic family of legaltech products

1. Work Management Tech

A traditional working culture hasbeen holding firms back fromembracing technological change.A recent Legal Week Intelligenceand Microsoft survey of legalprofessionals in the UK found that87% of those surveyed said theystill use pen and paper forcompleting legal work. 45

Things need to change.

The future firm will transition to amobile-first world, where all theback-end systems, processmanagement and documents arestored remotely in the cloud andaccessible anywhere and at any

time, using mobile devices suchas a phone or tablet. As the LawSociety recently reported,46

‘devices such as smartphonesand tablets allow lawyers toaccess law firm data remotely.They can conduct work on themove with easy access to firms’data and legal research platformsfrom any location.’

The strategic implementation ofthis technology is the ticket to itssuccess:

Less Work About Work: Accordingto the Workfront UK State of Work2018 Report, 15 40% of UK workersreport that they spend time onwork about work. Certainly not thebest use of their time. So selectingthe right work managementtechnology for the right teams iskey. The main objective should beto reduce work about work, andensure that tools are as easy toadopt as the technology in ourprivate lives.

Servicing Clients: Clients alsowant good management tech. Asmillennials reach an age wherethey rely more on legal services,many are discovering that lawfirms aren’t meeting thoseexpectations. Firms will need tostart considering digital servicesand cloud-based documentstorage, that will satisfy theMillennial’s craving for techsolutions.

“Baby Boomers are more likely than

Millennials and Gen Z’ers to say that they would rather forget to brush their teeth, than

get 50 pointless emails.”Workfront UK State of Work 15

87% of legal professionals said they stilluse pen and paper for completing legal work 45

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2. Legal Tech Tools

Today, there are three cleartechnology applications for law:

Blockchain: ‘Blockchaintechnology can affect the legalpractice by securing a databasewhere documents, such asevidence, can be stored and thenreferenced later on if argumentsarise,’ says Primavera De Filippi, aresearcher at the National Centerof Scientific Research in Paris andFaculty Associate at HarvardUniversity.49

AI-Automation: According to AIplatform Luminance, the samedocument review task, which

would take paralegals and juniorlawyers 15 hours to complete,takes just ten minutes through itsplatform [Raconteur LegalInnovation 2018 Report]. Otherapplications include documentproofing, document automation,decision trees, contract analysis,due diligence, and legal research.50

Online Courts: ‘Online is not analternative to the courts system, itis the courts system. Within tenyears, most cases will be resolvedby online courts,’ said ProfessorRichard Susskind, IT Adviser tothe Lord Chief Justice in the UK.3

The Pillars of the Future Firm Culture

Millennials and Technology 50

of employers expect to be working in a smart office in the next five years.

65%+

of Millennials say workplace tech would have an influence when deciding to take a job

80%+

would prefer to receive high-tech perks vs low-tech perks such as beer and ping pong

60%+

feel advanced tech & smart offices are crucial to a productive work environment

80%+

Gardens By The Bay, Singapore

Singapore’sSupreme Court went paperless in

2014 62

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The Pillars of the Future Firm Culture

But are firms doing legal techright? The short answer is: to acertain extent.

Intapp, a leading provider ofbusiness applications forprofessional services firms,conducted a survey incollaboration with The Lawyer.While every law firm in the surveyconsidered intelligent automationand data-driven insights to behighly important, there is asignificant gap between thisrecognition and the actualinvestment in deploying thesetechnologies.52

• 97% feel that intelligentautomation is important forconflicts, yet only 44 % offirms are taking advantage ofdata-driven insights in thisarea.

• 90 % of firms believe that usingdata-driven insights to manageclient terms is important, only16 % currently use technologysolutions for this purpose.

• 87% of firms think intelligentautomation is important forresource allocation, yet only14% have invested in this area.

• 86% of law firms agree thatautomation is important todeliver insights and analyticsto clients, only 18% have, todate, made the investmentsnecessary to embed thiscapability into their servicedelivery models.

• 44% of respondents statedthat intelligent automation foropportunity identification andcross-selling is very important,yet only 16 % of law firmsreport they are currentlyutilising data-driven insights.

tech community, thatprovides flexible legalsolutions to law firms and in-house legal teams. Founded in 2010, Obelisk specialises in unique work models that are designed to benefit both lawyers who choose to work differently, and clients who want access to an expert talent pool on a flexible basis.

In order to facilitate lawyer-to-client matching needs, Obelisk has developed a proprietary solicitor pairing software. Buzz starts by mining a database of 1,500+ lawyers for the best talent to meet the specific exigencies of clients’ needs. This custom-built technology platform then brings the team together through a transparent process of carefully designed steps and collaboration points. Essentially, it connects and then guides the entire team seamlessly through each project from start to finish.

However, the technology was not designed to completely replace humans. Checks and balances have been built into the system in order to preserve that human touch. Whether it be approving a solicitor search short-list, creating a client project wish list, or writing up feedback after a job is completed, Buzz ensures that a team member can always input his or her expertise.

ObeliskLondon, UK

Obelisk is an award-winning legal services provider and active member of the London

Going forward, firms willneed to understand howto embrace technologyin ways that augmentthe solicitor – with thesolicitor and technologyworking hand-in-hand.This will free up time forhim or her to focus onhigh-level consulting.

“Human first. Everything else comes after.” -- Dana Denis-Smith, Obelisk Support

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1. Gender EqualityThe issue of gender inequality isnot new, and neither is it specificto law. And yet no area of thebusiness world is more illogicallygender imbalanced than law firms.

How can the future firm finallyattain gender equality?

Flexible Work: The lack of flexibilityoffered by law firms isperpetuating the gender disparityin senior roles. As womenprogress in their career, they areforced to make decisions on howto combine working life withparental responsibilities. Oftenwomen leave because they can’tachieve a reasonable work-lifebalance. Flexible working needs tobecome accepted as a de factowork solution – without creatingnegative fears among those whochoose them.

Transparency of Gender PayReports: By including partners inpublished gender pay reports,firms will not only gain awarenessof the issue, they will also be in a

position to address it. Failure to doso may place firms at risk ofseeming out of step with thefuture lawyer. "I think they’remissing a real point in the currentsocial and political environment,"said Tony Williams, founder ofJomati Consultants, whichfocuses on the legal industry.24

Change from the Top: Of course,any corporate shift will flourish if itcomes from the top, and for anytype of broad culture change, acertain level of executive buy-in isrequired. However, because thegender gap in law is so big, andthe improvements so slow, drasticmeasures will need to be taken bythe most senior of partners inorder to effect change.

Pillar #4: Mind (Re)setPerhaps the biggest change overthe next decade, is the increasedexpectation of solicitors aroundequality and wellbeing. Withdemographic diversity as a bareminimum, solicitors of tomorrowwill look to firms for personalisedsolutions that meet their physicaland mental health needs.

However, the Top 100 law firmshaven’t arrived at this point yet,especially when it comes togender equality. Given that theystill struggle to fill top partnershippositions with women, and offermore work-life balance toemployees (while smaller firms donot), they are playing a dangerousgame with their future andsuccess in attracting and retainingtop talent.

Here are four areas that arecritical for the future firm inaddressing equality, engagementand wellbeing:

1. Finally enabling women toattain equality

2. A new way of approachingprofit sharing and equity

3. Eradicating the flex-workstigma

4. Taking mental healthseriously

The Pillars of the Future Firm Culture

January 2019 marked a historic moment for the US Houseof Representatives: The 116th House is the most diverseever sworn in, with more women, people of colour (men andwomen), openly LGBTQ+ members, and Millennials servingthan ever before.53

ChambersStudents.co.uk 26

2019 U.S. House of Democrats

Female Lawyers in the UK represent:

Photo courtesy of Getty Images

(Re)visited

58%of trainees

27%of partners

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The Pillars of the Future Firm Culture

Gianmarco Monsellato, Headof TAJ - a member of theDeloitte network, decided totackle the gender problempersonally by gettinginvolved in every singlepromotion. ‘For a long time,’he told Harvard BusinessReview, ‘I was the only oneallocating cases.’ He insistedon gender parity from thebeginning, by trackingpromotions, compensationand personally ensuring thatthe best assignments wereevenly awarded betweenmen and women.

Other firms can learn fromthis hands-on approach. Bytaking practical steps andfocusing on performance, itis possible to overcomegender bias.

‘My biggest issue is trying tostop women from working allthe time,’ Monsellato toldHarvard Business Review, ‘astechnology allows them towork anywhere, anytime. It’sthe “tone from the top” that iskey.’ Speaking to a roomfulof female lawyers at a recentconference, he remindedthem, ‘You are not aminority.’

Today, TAJ is 50/50 genderbalanced.54

tajParis, France

Today, it’s 2xas difficult to become an equity partnerThe Lawyer Bubble.com 55

2. (Re)thinking Equity

Promotion to equity partner hasbecome a pipe dream. Put simply,it’s twice as difficult to become anequity partner than it was thirtyyears ago, and that is thanks tothe underlying business modelthat produces these outcomes.

Today’s average profits perpartner are 2.5 times what theywere thirty years ago – when theratio of highest-to-lowest partnercompensation within equitypartnerships was 3-to-1, versustoday’s ratio exceeding 10-to-1. Asthe rich have become richer, andfewer, annual equity partnerearnings of many millions ofdollars have becomecommonplace.55

Curbing Billable Hours: The coreproblem starts with the billablehour, and moves through metricsthat managers use to maximiseshort-run partner profits. However,some firms have already startedtackling this sticky issue. Forexample, Forsters has one of thelowest billable hours target, withannual target hours for trainees at975, while still keeping its pay ofnewly qualified lawyers in line withCity firms.55

Alternative Fees: With clientsbeing more price sensitive and

interested in per-project feestructures, alternative fees suchas fixed fees, capped fees andsuccess fees are gainingmomentum. A key enabler is theuse of data analytics that canproject the total legal effort of aproject, allowing firms to providemore detailed and transparentpricing to their clients. ‘Our firmfrequently prices work accordingto the value of the solutionprovided to the client, rather thanby the hour,’ says Nick Pryor atBryan Cave Leighton Paisner.3Indeed, since clients value howfirms resolve their businessissues, rather than how manyhours lawyers spend trying toresolve them, adopting alternativefees is a future-proof approach toresetting the firm mindset.3

Higher-Archies: In order to appealto the future workforce, anotherconsideration would be to rethinkthe firm’s traditional hierarchicalstructure – which dates backhundreds of years for some. Manymillennials believe in a holacraticorganisational structure, involvingself-organising teams withdecision-making power, ratherthan a managerial heavyhierarchy. Here, every teammember’s opinion counts andshapes the work.56

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The Pillars of the Future Firm Culture

3. (Re)moving Flex-Work

In the Diversity & Flexibility Alliance2017 Report, 100% of the top 28US law firms surveyed, reportedthat they implemented reducedhours. However, of those firmsoffering reduced time, only 9% oflawyers actually use them, ofwhich 66% were women.

According to the Hydrogen Groupreport,16 44% of UK lawyers don’tfeel comfortable approaching theiremployer about flexible work, vs22% of their in-housecounterparts. However, when lawfirm HR departments were askedthe same question, 89% claimedthat staff would feel comfortableapproaching the organisation

about flexible working. Soclearly, there’s a disconnect.

In addition to this, only 41% ofUK law firm recruiters make itstandard practice to offerinformation about flexibleworking options beforesomeone joins their company.Of these, only 18% raise thetopic during the interviewprocess, and only 9% promote

44%of firm lawyers don’t feelcomfortable approaching theiremployer about flexible work

22%of in-house lawyers don’t feelcomfortable approaching theiremployer about flexible work

Hydrogen Group 16

Only 9%of lawyers actually use reduced hoursAlliance Diversity & Flexibility Report 60

Stigma

jobs on flexible working sites.16

A fundamental shift in how flexwork is viewed is paramount.Lawyers should not feel afraid torequest flexible work solutions,and neither should they bepenalised for not being at theoffice. To the contrary – it shouldbe encouraged and even rewardedwhen it results in an improvementto a lawyer’s work output.

“We have found that allowing agile working

has had a big impact on morale because people appreciate that trust.”

Sarah GregoryInclusion & Diversity Partner,

Baker & McKenzie 16

73%of 2,000 UK workers surveyed want a workplace culture where people are judged on the work they do rather than the hours they put inTimeWise and Deloitte 61

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4. (Re:) Mental Health

While every industry has workersfacing psychological challenges,those in law seem to suffer indisproportionately high numbers.

A 2016 study of US lawyers in theWall Street Journal revealed that20.6% of those surveyed wereheavy drinkers (vs. 15.4% formembers of the American Collegeof Surgeons) and that 28%experienced symptoms ofdepression (vs. 8% or less for thegeneral population). A 2012 CDCstudy also cited in the Journal,claimed lawyers have the 11th-highest suicide rate.55

Recent efforts to address mental

illness in the legal industry arecalling for the law to be amended,making it mandatory to appointmental health first-aiders in thesame way as physical first-aiders.’Employers who introducemental health first aiders andfocus on improving thewellbeing of staff see bothmorale and productivityimprove,’ says Jodie Hill atThrive Law.59

This is why it is paramount forfirms to not only remove thestigma of mental illness, but toalso put initiatives in place to helpany employees who are suffering.

The Pillars of the Future Firm Culture

Ernst & Young launched its ru ok? programme to addressmental illness and addictionamong its staff. The idea is toenhance EY’s culture ofcaring by reaching out topeople who may bestruggling, and removing thestigma around asking for, oraccepting help. Theprogramme also offers 24/7support.56

American Express’ HealthyMinds employee assistanceprogramme not only providespart-time counsellors at eachemployee clinic, but it hasalso hired a clinicalpsychologist to run theinitiative and continuouslyimprove its services.57

Online banking giantBarclay’s began This Is Me tochallenge the ‘stigma aroundmental health at work andaim to break the culture ofsilence, by supporting peopleto tell their own stories.’Spearheaded by thecompany’s disability networkknown as Reach, thesecolleagues banded togetherto record their mental healthchallenges.57

Unilever, a 172,000-personcompany, has a global healthinitiative in place for allemployees that includes aspecific and comprehensivemental health program. Theyprovide training for managersand senior leaders, hostinternal campaigns to raiseawareness about mentalillness, and hold regularemployee workshops onsleep, mindfulness andexercise.58

Who Is Doing

what?

Becoming a partner is the dream that has for decadesmanifested into a monster culture of working ‘til you dropped,and then some. But if the ends justifies the means, then how is itsustained when the ends are no longer in reach? Firms will haveto ask themselves the hard question: ‘How can we increase therate of partnerships at our firm, without also driving more hoursof work?’ And more importantly, ‘How can we encourage genderparity at the top echelons of the ladder?’

38%of 70,000 Law Society’s Junior Lawyers Division members said they experienced mental illness in the last year.LawGazette.co.uk 59

Photo courtesy of Buco Balkanessi

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The future firm will focus on optimising creativity,collaboration and productivity – and atsupersonic speeds.

In this world, agility, speed and creativity will drivethe competitive advantage, by focusing on thefour pillars of firm culture:

1. Promoting flexible workspace options thatcan be tailored to the worker’s needs

2. Fostering a future lawyer that isentrepreneurial and adaptive to a variety ofsituations

3. Strategically adopting technology that makessense for specific, clearly defined objectives

4. Resetting the corporate climate to be moreaccepting of differences in people and howthey work

This change is significant. It will take time and effort and it can't be done alone.

This is why we're excited to be able to partner with law firms to share Obelisk Support's experience of making flexible working work, along with access to our talent pool of over 1,500 lawyers.

Working closely with you, we can provide the following services to help your firm thrive:• On-demand access to over a million hours of

flexible legal talent• Design, advice and sourcing to power your

own "Returners" programme• Consulting to help you understand and evolve

your workplace culture.

Together we will forge a strategy that will evolveyour work culture in terms of place, people,technology and mindset, in order to promote toptalent, delight clients and ensure the futuresuccess of your firm.

We have reached a critical moment. Let's takefundamental action to future-proof the shape andoperation of the legal industry.

What’s next?

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About obelisk Support

Obelisk Support is an award-winning legal services provider and an active member of the London tech community, providing flexible legal solutions to law firms and in-house legal teams, including those of many of the FTSE 100. Dana Denis-Smith, the founder of Obelisk Support, is an outspoken champion of women in law. She is the LexisNexis Legal Personality of the Year 2018 and is also the founder of the First 100 Years Project.

Founded in 2010, Obelisk Support has developed a unique flexible working model, designed to deliver high-quality legal expertise to law firms and in-house legal teams without the constraints of traditional office hours. Our consultants can be available in a matter of days for urgent projects or work with your teams on longer-term engagements.

contact

Dana Denis-Smith, CEOObelisk [email protected]

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This publication has been prepared for general guidance on matters of interest only, and does not constituteprofessional advice, it may be subject to change or update without notice. You should not act upon theinformation contained in this publication without obtaining specific professional advice. No representation,assurance or warranty (express or implied) is given as to the accuracy or completeness of the information ordata contained in this publication, and, to the extent permitted by law, Obelisk Legal Support Solutions Limited,its members, employees and agents do not accept or assume any liability, responsibility or duty of care for anyconsequences of you or anyone else acting, or refraining to act, in reliance on the information contained in thispublication or for any decision based on it.

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