Despite many years of predictions that we are at a point of inflection, the world looks the same for very many law firms and solicitors. There are still just over 10,000 law firms and the number of solicitors continues its steady rise. There has been no ‘big bang’; no revolution; no game changers.
But if we lift our eyes beyond what is familiar, the world looks very different. We are approaching the moment where 10% of regulated firms are alternative business structures (ABSs).
There are major global firms that have integrated legal services into their commercial, tax, advisory, outsourcing or consultancy businesses. They have the budget to buy Riverview Law, while private equity snaps up great businesses such as Lawyers on Demand.
There are US companies such as LegalZoom and Rocket Lawyer starting to offer good and affordable legal services, as models of delivery, like Keystone Law, drive great value for money. And unregulated legal businesses, employing regulated solicitors and legal executives, such as April King are growing as they focus on their customers.
To adapt Ernest Hemingway, change happens in two ways: gradually and then suddenly. So, in 2019, is change going to happen gradually or suddenly?
This year offers unprecedented opportunities consequent on regulatory reform. The SRA’s new Standards & Regulations replace the 2011 Handbook this year. A much less prescriptive regulatory regime may have been resisted by those who want to protect traditional business models, but it offers enormous opportunities to any solicitor or law firm that wants to think differently.
It is more significant change than the introduction of ABS and opens up a wealth of opportunity to firms wanting to innovate and develop.
Unregulated legal businesses will be able to tell the public that they can come to them to get legal advice from a solicitor. ‘Solicitor’ is the one truly significant brand in the legal market: it resonates with the public. And traditional law firms owned and managed by solicitors will no longer have a monopoly on it.
Many of the firms that have entered the legal market with new ideas over the last five or 10 years are already looking at how they might reduce their costs by taking advantage of these changes. Others that have been put off the legal market by the prescriptive regulatory regime will be considering the opportunities that arise by being able to employ solicitors to offer non-reserved legal services.
It isn’t just about opportunities for legal business. Solicitors that want to work differently no longer have to go through the contortions of becoming a sole practitioner or being seconded or temporarily hired into law firms or in-house teams. They can become freelancers and deliver reserved services with greater flexibility.
There is more. The requirement for trainees to do multiple ‘seats’ disappears, giving employers greater flexibility and opportunity to train solicitors that are fit for their firm. No need to wait for Solicitors Qualifying Examination (SQE) – these changes are part of the SRA’s new Standards & Regulations.
And while the first exams for SQE might still be over three years away, SQE should already be shaping the 2019 recruitment, education and training strategies in every legal business.
Increased price transparency, driven by the Competition and Markets Authority (CMA), will start to affect consumer choices this year. Those who have said consumers must choose on quality not price need to work out how to genuinely convince the public that this is correct, when their competitors are offering lower prices and claiming high quality too.
This seems like a good year to be asking our customers what they really think and want.
Reform of professional indemnity insurance has been on the cards since 2010. The serious business of designing regulatory obligations on insurance that go no further than are proportionate and targeted is inevitable: just read the CMA report
.
Firms should already be asking themselves what level of cover is appropriate given their work and clients – and buying more than the minimum where necessary and asking the SRA for a waiver to buy less where appropriate.
The new Standards & Regulations will take effect in late spring but there is no need to delay. Every solicitor and firm should be identifying how to take advantage of these changes and asking the SRA (through SRA Innovate
) for waivers where appropriate.
It is easy to sit back while change happens gradually. But others are taking the new opportunities and if law firms respond, then at some point their customers may let them know that change has happened suddenly.
This blog first appeared on Legal Futures
