I saw something online the other day that attempted to answer the question, “how is innovation related to design thinking?” The response, written by John Coyle, a former Olympic speed skater and CEO at Speaking Design Thinking, caught my eye. He began his response by reversing the question to “how is design thinking related to innovation?” I thought that was insightful, but my appreciation for his answer ended there. Coyle defined design thinking as “a process and a mindset used to solve complex problems in unique and innovative ways.” In other words, unique-ness and innovation are inherent attributes of design thinking. I see design thinking a bit differently.
BTI Consulting Group reports that corporate counsel have singled out Valorem Law Group as a “Mover & Shaker”–“firms disrupting the legal industry by make strategic and tactical moves others don’t.” We are honored to be singled out in this fashion. From our founding in 2008, we’ve led the move to the New Normal, been named as one of 22 firms “best at AFAs,” and regularly have been recognized by corporate counsel for our brand excellence and extraordinary client service. What sets this recognition apart, however, is its validation of our move earlier this year to create ElevateNext Law and align ourselves with Elevate Services. I wanted to spend a couple of paragraphs describing what prompted this major move by my Valorem partner, Nicole Auerbach, and me.
On Monday, my partner Nicole Auerbach and I announced the launch of ElevateNext, which will work alongside Elevate Services, a best-in-class law company. And with Elevate, we announced our collaboration with Univar, a Fortune 500 chemical and ingredient distribution company, to reduce its legal spend by 50%. Many have followed our time with Valorem. I am grateful for the sustained interest in our work at Valorem, and so I wanted to share the thinking that went into the creation of ElevateNext.
Using its search and social metrics, Feedspot is honoring 40 blogs from among the thousands of Legal Marketing blogs. Blogs were ranked on the following criteria:
- Googgle reputation and Google Search ranking
- Influence and popularity on Facebook, Twitter and other social media
- Quality and consistency of posts
- Feedspot’s editorial team and expert review
With that selection process, I am honored and humbled that this blog has been named a Top 40 Legal Marketing Blog.
I have been a renter. I have been an investor in homes. I have been a buyer of homes and I have worked with a builder to design and build a home. Each experience has its pros and cons. The critical thing to making each role a successful one is to decide in advance what role you want to play. The same lesson holds true for operating a business and for operating a law department.
I just finished reading Mary Juetten’s post in Above the Law, Time Is The New Black. I was struck by this statement:
“Also, all should reject the value billing theory that recording time is unnecessary.”
Since there are few statements with which I would disagree more, I decided to parse the article and respond to the arguments the author makes in favor of the necessity of timekeeping.
Argument No. 1: “Considering the Big 4 accounting firms track time, BigLaw should pay attention.”
Apparently, we are left to simply accept the notion that the Big 4 do everything precisely the right way. I am not ready to make the blind leap. The leverage model is a dying one. Most of what young lawyers and accountants do day-to-day will be automated in the near future. Indeed, a lot of it already has been. If a machine can do weeks and months of tasks in a milsecond, how is that hourly model working for you then? Beyond that, real businesses don’t sell time—they sell outputs. Law firms provide outputs and that is what clients want to pay for. Deal with it.
Argument No. 2: “Timekeeping is the key to understanding your costs and pricing because human effort is still the law’s largest expense.”
Again, the growing significance makes this statement less than accurate and less true with each passing day. If a law firm invests in technology for the betterment of its clients, it should be able to charge for the value that software provides, not the time it takes for the computer to do a task. The author makes a nifty argument that “Ford knows precisely how much it costs to build my F150 for both materials and labor.” What she ignores is that Ford knows that information before it begins to manufacture the vehicle and if there is a breakdown and the time to complete a vehicle is longer, the price does not increase. Third, there is a discrepancy between using time as an element of “cost” when the resource devoting the time is not paid based on time. A lawyer who works 7 hours to complete a task is rarely paid more than a similar lawyer who takes 6 hours. When that is true, what difference the difference in time make? And what about lawyer who can reuse work? If time plays a role in price, you end up overcharging purchasers of the work-product.
Argument No. 3: “Recording the non-billable or non-client hours can also help evaluate the efficiency of the department or practice administration.”
The time from task assignment to task competition may be a slight indicator of efficiency, but the number of tasks completed over a period of time is a much more important piece of information, as is the number of tasks completed in a given time period to meet required quality standard. Time devoid of quality assessment is just not important.
Argument No. 4: “[T]he hour information will help you identify where attorneys and paralegals might be struggling or have gaps in their training.”
This necessarily implies you have an existing baseline you can use tocompare the hourly total. If you have the baseline, you certainly don’t need to hours for pricing. And do you really think looking at time data is the best way to evaluate productivity? Businesses around the world regularly evaluate productivity of their professional works and they manage to do so without requiring those professionals to keep time. And they have been doing so for decades.
Beyond these arguments, the author wholly ignores the costs incurred by firms in recording and tracking time. Timekeeping also allows firms to default to time as a basis for evaluating and rewarding their lawyers. Not a good thing. But most importantly, all of this focuses on cost of production and not on the clients’ interests in buying. If Ford’s market showed that people did not want to buy F150s and instead wanted a low-priced vehicle, making the cost accounting for the F150 isn’t really worth much. The focus needs to be on the buyer, not the producer.
Lawyers always seem to look to our own profession for reasons to justify the practices we follow. The horizon for such justifications should be our clients, not our competitors. If a firm has clients where the law department professionals track their time and are compensated based on how much time they bill, then maybe the law firm can claim to track their clients as a justification for the focus on time. But if anyone finds a department like that, let me know. I have not heard of a single one in 10 years of practicing without time sheets.
I read this and immediately started thinking about my Saturday morning encounters with our washing machine. Walk by, put the towels in and then feed the dogs. Swing by later after grabbing morning coffee, put the towels in the dryer and put the whites in the washing machine. Lather. Rinse. Repeat. Episodic encounters with the washing machine while life goes on. So as I returned my thought to the tweet, I wondered if this “washing machine” frame of mind was the right one.
Artificial intelligence aims–or at least it should–to solve a problem for the consumer of the AI. If it doesn’t do that, I am not sure what role it will play for the user other than being a shiny new object. Think
(yes, I confess to having one of these) Don’t get me wrong, shiny objects can be fun and you can sell a lot of them. But they don’t last and they don’t make an impact.
So, how my washing machine and shiny object obsession fit in with AI? I believe buyers need something more than a washing machine to use it. The AI must integrate with existing life and reduce or eliminate a problem. If a General Counsel is forced to add a whole new platform or file system to get a benefit, I think the likelihood of success of the AI is reduced.
It seems to me a useful exercise would be to define the attributes that must be manifest if something new is to capture the market. To me, a starting point would be: simplicity; ease of use; eventual benefit; time to achieve eventual benefit; “fit” with what I am doing now. I think the holy grail in attributes is holism. HAL 9000 offered these attributes. Washing machines, not so much.
Seth Godin just posted Four Ways to Improve Customer Service. As always, Seth’s insights are insightful and thought-provoking. The four ways are:
- Delegate it to your customers. Let them give feedback, good and bad, early and often.
- Delegate it to your managers. Build in close monitoring, training and feedback. Have them walk the floor, co-creating with their teams.
- Use technology. Monitor digital footprints, sales per square foot, visible customer actions.
- Create a culture where peers inspire peers, in which each employee acts like a leader, pushing the culture forward. People like us do things like this. People like us, care.
I think if law firms were self-critical, most would evaluate themselves as failing in each of these categories. And since many of these firms profess (well, at least say it on their website) to be “client-focused” or something akin, one can only wonder about the gap between what is professed and the truth.
Pedantic is defined as “narrowly, stodgily, and often ostentatiously learned a pedantic insistence that we follow the rules exactly” and “unimaginative, dull.” You’ll see in a minute why I began with this definition.
I read an interesting article in today’s Chicago Tribune on the signs of greatness in companies. One of the key signs is that “no one is pedantic.”
For 26 years, [the author has] been involved in multiple organizations and volunteered at many different entities both small and large, and the one thing that seems to kill all progress and creativity is a heaping dose of pedantry. When everyone acts like know everything, when they are slavishly devoted to rules and when they are fussy, finicky, strict and overly fastidious, then nothing good will happen.
When the company is filled with open-minded people who want to learn new things, it becomes a great place.
So, what kind of firm or department do you work in? And even more specifically, what are the new things you’ve learned in the last month? Year?
This trait fits tightly with the need for a culture of continuous improvement. If you are not improving, you are falling behind. One easy example–good client service just a few years ago is nothing special today. You should be able to map your changes and demonstrate why the changes are an improvement. Can you?