This piece was originally published by Raconteur, March 2017.

Legal innovationInnovation is a word bandied around a fair bit in the legal industry today. But with its rising popularity in the legal lexicon, we might be missing an important point.

Yes, we are seeing a lot of change in today’s law firms. New legal businesses, the digitisation of law (including artificial intelligence), contract lawyer and/or consulting subsidiary businesses, low-cost service/delivery centres... You name it, there’s something going on.

But where innovation suggests a sudden game-changer, we at Totum have seen the shifting current beneath the surface. It has laid the right conditions for what may now be radical transformation. It has set in place the momentum to generate new ideas, and has allowed for the emergence of fresh skills and expertise that continue to change legal culture from the inside out.

This change is the rise of business services in law.
 

As legal recruiters, we realised in the late 90s that something major was happening in the legal profession. Technical skills were no longer sufficient. Business management and all the skills that go with it were increasingly seen as critical. We saw tiny functions in marketing and BD, finance, IT and HR expanding into sophisticated departments comprising both generalists and specialists, and rapidly taking on much broader, often global remits at a strategic level. Today, it is the norm to see business experts, from increasingly broad industry backgrounds, take on the leadership mantel in law, becoming chief executives, COOs and board-level directors.

As recruiters now dedicated to business services recruitment, we get to see first-hand this rapid evolution in business capability in law. A significant part of our work today is helping firms across a plethora of new business roles – those jobs where firms know new skills and fresh insights could deliver significant advantages to performance and service delivery. Such roles include project and process improvement managers, knowledge engineers, data scientists, product managers, heads of pricing, commercial directors, change managers… the list goes on.  

And then there are those specifically tasked with innovation. Our recent research has shown that 26 of the top 35 law firms now employ a business services professional with an innovation brief. Such managers are typically engaged to facilitate and bring together new ideas from across the firm, and help develop them – from delivering internal, efficiency focused improvements to implementing new product/service lines. They are conduits for change, helping to write business cases and building relationships with the right people across the firm to turn ideas into action.

This links in too with another phenomenon we are seeing – the increasing integration of business services capabilities. Just as innovation managers must interact with all levels of the firm, so are the lines blurring between other business functions. We have worked on IT director roles, for instance, which require a close relationship with process and project management teams to enable firm-wide efficiency improvements. Likewise, there are the digital managers that sit with both IT and marketing, and cyber security experts who bring together IT and risk. Increased collaboration brings with it possibilities to meet new firm-wide objectives.

If firms now seem to be picking up the pace of change, if they seem more willing to embrace risk and try things new, it’s not because they have plucked creative zeal out of thin air. No, in our view, it’s because firms have done a lot of groundwork. They now have a genuine belief that they either have the right business skills and capabilities to enable successful change – or they can acquire them. With knowledge has come courage.

Of course, there is always an element of fear to jolt law firms into action too – the odd law firm collapse is a reminder that size and ambition are not enough. But law firms increasingly understand that between success and failure lies a fierce competition for the best business talent – for this is the fertile soil from which innovation can blossom.

Click here to see Raconteur's full 'Legal Innovation' report.

Click here to read this article on Raconteur's website.

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