Page 56 - Lawyers and Accountants - The Future of Professional Services -1
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Lawyers and Accountants 2020 - 2024
Because top professional service firms must provide both local as well as global services, they have no choice
but to be part of an MDO or MDP. While the Big 5 are adapting their strategies to both localization and
globalization, the larger issue is whether their structures are suited for optimum performance when new
technology makes a decentralized operation much more efficient and cost effective.
[2]---Core Competencies and Quality
The American Bar Association’s Commission on Multidisciplinary Practice in its final report added
competency as one of the core values of the legal profession.135 While the other core values may be what
distinguish a profession from a job,136 competence of professionals is what clients seek, perhaps above all.
The Big 5’s MDP strategy developed because complex transactions require assembling and managing teams
of competent professionals to assist the client. As competencies converged or began to intersect this raised
the unspoken issue that is the heart of the multidisciplinary practice debate: Who manages the team when
many issues are involved in the transaction? It is the “managed’ who must make decisions on the importance
of each of the services being provided to achieve the desired result. This is where the power lies and what
may be really at stake in the MDP debate.
The Big 5, using their multiple services, would like to manage the entire transaction. Managing the transaction
means higher fees than simply being part of the team. Perhaps this is why the Big 5 places so much emphasis
on management and marketing 137
Law firms and other professionals may be extremely competent in their limited areas of expertise. However,
the skills that are required to reach and implement a conclusion are more managerial then professional. Since
multidisciplinary partnerships are prohibited in most of the principal jurisdictions, the very real question for
the legal profession is: How are lawyers going to develop these managerial skills that the client considers to
be the most important element of the transaction? For the time being, law firms, because of ethical restraints
or lack of skills, are unlikely to be the ones chosen to manage the transaction. This means that the Big 5 have
the capacity to control the transactions regardless of the other services that may be required to complete it.
Again, the MDO can assist all of its members in developing new management skills by sharing information.
This can be done at meetings and in publications. Members can meet individually to form sub-groups. These
new skills will make each of the members more competitive as well as more competent to provide and
manage complex services for their clients.
[3)----Cost Effectiveness through Technology
More than one third of the cost for legal services is overhead including rent, support, equipment and
marketing. Technology in recent years has reduced the staff support costs and generally improved
productivity.138 The Internet, because it is accessible from many location, will even make more change in the
135 American Bar Association, Final Report to the House of Delegates, July 2000.
136 The other core values were independence; maintain confidences and loyalty by avoiding the conflicts of interest.
137 Arthur Andersen has numerous training facilities where new recruits as well as lateral hires are trained in the business of management.
http://www.arthurandersen.com/website.nsf/content/CareersTraining?OpenDocument.
138 For overhead comparisons, see the Altman-Weil Annual Law Firm Survey results.
53
Because top professional service firms must provide both local as well as global services, they have no choice
but to be part of an MDO or MDP. While the Big 5 are adapting their strategies to both localization and
globalization, the larger issue is whether their structures are suited for optimum performance when new
technology makes a decentralized operation much more efficient and cost effective.
[2]---Core Competencies and Quality
The American Bar Association’s Commission on Multidisciplinary Practice in its final report added
competency as one of the core values of the legal profession.135 While the other core values may be what
distinguish a profession from a job,136 competence of professionals is what clients seek, perhaps above all.
The Big 5’s MDP strategy developed because complex transactions require assembling and managing teams
of competent professionals to assist the client. As competencies converged or began to intersect this raised
the unspoken issue that is the heart of the multidisciplinary practice debate: Who manages the team when
many issues are involved in the transaction? It is the “managed’ who must make decisions on the importance
of each of the services being provided to achieve the desired result. This is where the power lies and what
may be really at stake in the MDP debate.
The Big 5, using their multiple services, would like to manage the entire transaction. Managing the transaction
means higher fees than simply being part of the team. Perhaps this is why the Big 5 places so much emphasis
on management and marketing 137
Law firms and other professionals may be extremely competent in their limited areas of expertise. However,
the skills that are required to reach and implement a conclusion are more managerial then professional. Since
multidisciplinary partnerships are prohibited in most of the principal jurisdictions, the very real question for
the legal profession is: How are lawyers going to develop these managerial skills that the client considers to
be the most important element of the transaction? For the time being, law firms, because of ethical restraints
or lack of skills, are unlikely to be the ones chosen to manage the transaction. This means that the Big 5 have
the capacity to control the transactions regardless of the other services that may be required to complete it.
Again, the MDO can assist all of its members in developing new management skills by sharing information.
This can be done at meetings and in publications. Members can meet individually to form sub-groups. These
new skills will make each of the members more competitive as well as more competent to provide and
manage complex services for their clients.
[3)----Cost Effectiveness through Technology
More than one third of the cost for legal services is overhead including rent, support, equipment and
marketing. Technology in recent years has reduced the staff support costs and generally improved
productivity.138 The Internet, because it is accessible from many location, will even make more change in the
135 American Bar Association, Final Report to the House of Delegates, July 2000.
136 The other core values were independence; maintain confidences and loyalty by avoiding the conflicts of interest.
137 Arthur Andersen has numerous training facilities where new recruits as well as lateral hires are trained in the business of management.
http://www.arthurandersen.com/website.nsf/content/CareersTraining?OpenDocument.
138 For overhead comparisons, see the Altman-Weil Annual Law Firm Survey results.
53
