Business Essentials for Law Firm Success with Jordan Furlong
Jordan is an author, advisor, and legal market analyst who forecasts the impact of a rapidly changing world on lawyers and legal organizations. He is a Principal of Law21, a consultancy for legal leaders seeking strategic advice and a platform for Jordan to share his thoughts about the new legal economy with the legal community.
This episode was recorded on May 7, 2020 during the eighth week of the U.S lockdown due to the coronavirus pandemic. Gina and Jordan were working from home. The world had changed. The two discussed the legal industry and strategies for the future practice of law.
What is a legal analyst, a futurist, and someone who helps with lawyer development and competence?
The answer I would have given two months ago is probably different from what I would give right now because the problem with being known as a futurist is that when the future arrives, then it’s like, “Okay, now what?” Because the future is here. There’s not much point in talking about what the legal market is going to look like in 5, 10 or 15 years because everything is up for grabs now. There is so much uncertainty. We have an entirely new playing field. There’s a lot of data that we don’t have in front of us to be able to make accurate forecasts. It’s an entirely new ballgame. A lot of us have to reset our expectations, goals and priorities for what we’re going to do now in the months and years that are going to follow this period.
Gina Rubel: It is interesting that you say that, I was looking at your Twitter feed this morning, and I will quote, you said, “Trying to forecast the ultimate impact of the pandemic on the law is like trying to predict the final score of the ballgame when it’s 1-0 in the bottom of the first inning. We have a long way to go.” But everyone wants answers. Everyone is trying to figure out their long-term strategy before they’ve even gone through triage.
Jordan Furlong: One of the things that comes as a surprise to people is how early it is in the ballgame. People think, “Surely we’re at the seventh inning stretch by now.” I would say, “No.” Since there is so little data available to us, we have to focus on the essentials.
What are the four essentials that law firms should focus on during the pandemic?
Right now, your focus has to be on four fundamental aspects of your practice and your business. The first one is you personally. You’ve got to take care of yourself, which is something we’re not good at as lawyers at the best of times. You have to take care of your emotional, mental and physical health. You deserve to be taken care of, and you have every right to that. Everything depends upon your ability to show up every day and perform. Like the old saying goes: 80% of life is showing up.
Then, you have to look to the people who depend on you: Your employees, associates, or the people for whom your legal business is their main source of income. The reports show that every law firm seems to be announcing cutbacks, layoffs, or reductions in salary, etc. That’s fine. You do what you have to do, but I think you want to do it with a degree of compassion and regard for these people and say, “When we can, we’re going to pull you back into active duty.”
Next, you focus on clients. You turn to them and say, “What can I do for you?” It’s so important that I make this point to lawyers all the time. You’re not phoning up clients to say, “Hey, what legal work can I do?” You’ve got to reach out to them as a counselor or trusted advisor to say, “How are you? How’s your family? How’s business, and what can I do for you? If it’s not a legal matter, I might know someone who can help you out with this or connect you with someone.”
Finally, focus on determining the level of cash flow and keep the cash flowing in because that is the oxygen of legal businesses. In that context, it’s like when you’re talking to clients and you say, “I’m going to do a bunch of stuff for you. You’re going to send stuff along to me as you need it, but we’re not going to do the whole silly billable hour docketing. You’re just going to give me an amount every month that we’re going to pre-negotiate. You’re going to drop it in electronically through credit card offers, Stripe, etc. This way, I have enough money coming in to keep my business going. You know what your legal costs are going to be, and we can start moving from there.” That’s triaged–as you said, that is getting through the chaos period without even any regard to the transition that will follow. I think those kinds of fundamentals are what lawyers should be looking at right now.
Our mutual friend, Tim Corcoran, mentioned to me was that you had shared another analogy, which I really think hits home right now. Can you tell me about that?
In the very first days and weeks of this crisis, the Canadian government put together a task force of various members of parliament and ministers and said, “You’re in charge of managing all this.” The vice-chair of this particular group, before he became a politician, was the head of the economics department at a university in Montreal. He was talking with a reporter about their approach to managing all this. He said, and I paraphrase: Picture it as is if the country is an airplane that has been caught up in an unexpected, terrible storm. You’ve got three things you have to do. First, you have to land the plane safely onto the ground. Second, you need to secure the plane on the ground, so that it is protected, and make sure the people inside are alright. The third stage is making sure the plane is ready and able to take off when the storm is over.
I thought that was a great way to describe the process we’re in. He says, “We’re still landing the plane.” We’re still in the process of bringing it down, and I think we’re probably going to be there for at least a couple more months.
Then, there’s the security that we have to take care of beyond that point, to make sure everybody’s fine. It’s not just about flattening the curve. It’s also about building up all of the reservoirs of testing, tracing, and the PPE that we need, so that when the next wave comes, and it will, we are better prepared for it than the first time. I thought the analogy really resonates with law firms and legal organizations as well. Your first duty is to get the plane on the ground and get everybody safely into a position where they are more secure than they were when this whole thing started.
What is innovation in the legal space? How do law firms need to innovate due to coronavirus?
Innovation is the process of looking at what you’re doing, looking at how you’re doing it, and asking yourself: If we weren’t already doing it this way, is this how we would do it? If we were doing this for the first time, tomorrow, and it has never been tried before, is this the methodology? Is this the process we would use to get there? Then, if I am the end-user, if I’m the person who’s at the business-receiving end of whatever you’re doing, would I look at this process, system, habit, or assumption you’ve been making and say, “That’s perfect?” That’s exactly what it should be.
It’s the mandate. It’s the need to say, “Our old ways of doing this are barely working compared to when we started this process. How can we do this better now? How can we start something new?” This is why I talk about triage. Put the things that are on fire out. If something is smoldering, throw water on it. But, you’ve also got to have at least one eye towards what’s going to replace the thing that’s burning down right now. For law firms now, in the middle of the crisis is not when you start drawing up the blueprints, for your brand new law firm of 2030. But, you’ve got to have at least one eye cocked in that direction to determine what you’re going to be looking at. That’s innovation. It is fundamentally focused on the end-user. It is focused on people and outcomes. I think that’s what we need more of in the law.
How do you convince law firms and leadership to invest in the time needed for innovation?
The biggest factor in my mind is the quality of leadership itself. It doesn’t matter what the surrounding circumstances are, whether it’s in a golden age or whether we’re in a storm. The quality of leadership, your ability to articulate a sensible vision worth following and investing in, should be communicated. Connect with people to say, “This is where we’re going.” It is so important at the early stages of any kind of a change or innovation process, to do the walking around and saying, “This is where we’re going, this is why we’re going there, and these are the benefits that we expect to see at the end of it.”
In most cases, approaching this is not to say, “Is that okay with you? Would it be alright if we did that?” It’s to say, “This is what we, as a firm, are doing. As a managing partner or leader of this firm, I have been chosen and delegated to look out for the firm’s best interests. That’s what I’m doing. Here’s what I need you to do and what I’m asking you to do, as part of this process.” And, if you don’t want to do that, there are a couple of options available to you.
One of them is that the door is over there, and feel free because it’s a wide world out there. The second is to say, “If you want to be part of this and you are a valuable member of this team, that’s great. I’m interested in your input. I’m interested in what you have to say about this.” But, your personal interests cannot, from my perspective, be allowed to alter the trajectory of the firm’s best interest. This is the fundamental conflict at the heart of almost every law firm. What’s in the best interest of the firm is not what many individual lawyers consider to be in their best interests. For me, I have no difficulty in waving goodbye to someone who says, “My interests are more important than everybody else’s here.” For the partner who says, “I’m going to come into the office, and I’m not going to wear a mask; I’ll do whatever the hell I want.” Why don’t you take a sabbatical that starts now and ends whenever? Because I don’t need you, and I don’t need this kind of disruption in the firm.
How can adaptation be managed in an emergency situation or pandemic?
I think the way big and small firms should approach it is to get the stakeholders around the table and say, “The environment in which we were working, applying our trade, and doing all this work as recently as two or three months ago is going away for at least a couple of years. It will probably not return to its previous form.”
This is the one thing everybody seems to agree on. Whatever the world looks like at the end of this, it won’t look like January 2020. We are going to need to be something different for that world. This is our chance to be not just different but better.
This is the other point that I want to bring forward: Innovation. Innovation is not just about spending money and making change for change’s sake. The whole point is that we do this better. Go around the table at any partner meeting and name one thing that you wish were done differently around the firm.
Make a list, and move forward from there. There will be a level of resistance, but business is dropping off rapidly and radically. I think a lot of lawyers and partners are somewhat scared, so I think this is the void where a leader can step up and say, “This is how we get out of this. This is the way we take it. The way we used to do this before all this happened is nonsensical. I cannot recommend it, and I strongly urge you against it.”
How can law firms address the value, experience and satisfaction of the client?
I would recommend that law firms focus on client value and client experience. Create a spreadsheet. The first column in the spreadsheet is what the client asked us to do. The second column is what we promised the client that we would do. The third column is what actually happened, and what the outcome was. That third column requires reevaluation or postmortem, and you look at it, and you say, okay, this is what actually happened as a result. This was the outcome. For the moment, I’m not concerned about how we got there, the ins and outs, because that’s always a winding path in the law. There’s always things you don’t expect.
Finally, the fourth and most important column is what the client thought of it. There are a number of lawyers and firms who contact clients and say, “We just concluded this retainer. Here’s a copy of the letter that we wrote at the start. I want to know how satisfied you are. How happy are you?” Yet, they don’t act on it.
There’s nothing worse than surveying clients about how you can help them better, and then they never hear from you again. You might as well never have even asked. Create that spreadsheet and act on it.
It also takes the courage to be able to go to your partners and lawyers and say, “We’re tracking what we do for these people, and if they come back to us and say ‘I’m not happy about it,’ then I’m going to arrange a meeting with you, me and the client, and we’re going to talk about what happened. We’re going to apologize for the shortfall of expectations, and we’re going to take steps to make sure it doesn’t happen again.” That’s courage. That’s leadership. It’s politically difficult to do in a number of law firms.
Gina Rubel: It’s also important that law firms stop worrying about whether or not they’re billing the time to do the follow-up. Lawyers should be given the opportunity to do a follow up because it is an extension of relationship development, not just business development.
How can law firms plan for the future?
I’m hoping that during 2020 we can start to see the transition point begin, and we can start moving toward the next series of challenges. It is not out of the question that we will be stuck in a triaged loop. If you are in a jurisdiction that is continuing to see the rise or plateau of diagnoses, and nonetheless, we’re going to open up the community and the economy again, then yes. I think we’re just getting started into the cycle of lockdowns. It’s going to take a while before we move out of triage, but we will get to that point. Once we hit the transitional stage, that is the time you should think about what sort of institution you want to be.
Whatever we were doing at the beginning of the pandemic will be different than what we are doing at the end, and we’re going to reach that different point in one of two ways: 1) We’re just going to go along with the flow of the raging river, and we’ll be beached up along the way. Whatever circumstances have developed will force us to be a certain way. 2) Or, we can say, “I’m going to grab an oar. We’re all going to grab an oar. Yes, it’s a whitewater river, but we’re pretty strong, and we’re going to choose our destination.”
It doesn’t mean you can snap your fingers and boom! You’re there, but at least you tried to get to a certain point, and you knew what you wanted to be. For all the money that law firms spend on trying to draw lateral partners in and trying to attract people, having a vision or idea of who you are and the purpose of your firm is vastly underrated as a way to draw to you the kind of people that you want, and to be the firm you want to be.
It’s not too soon. Even in triage, it’s not too soon to think during your rest times about what the ideal destination will look like for us when it’s over. Then, as the fire starts to be put out and things are smoldering less, then you start thinking about how we start getting to that point. How do we choose that destination? Deal with the fires as they’re taking place. But now is also the time to picture who, where and what you want to be when this is all over.
Jordan, I am thrilled you could join me today. I’ve really enjoyed our conversation and I am sure our listeners have too. Where can people learn more about you or how can they get in touch?
You can reach me online. My email is email@example.com, but I’m most often on Twitter @Jordan_law21.
We’ve been talking with Jordan Furlong, Principal of Law21.
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