Page 61 - Lawyers and Accountants - The Future of the Professions
P. 61
Lawyers and Accountants 2019 -
Information on professionals, as well as non-proprietary content, would facilitate creating relationships. An
extensive non-confidential knowledge base would be created and shared within the MDO.154
Fourth, access to information on MDOs would not be confined to the participating entities but provided to
clients. Clients could use the information to construct virtual relationships of their own using, as the initial
building blocks, the professionals and services in the R-MDO. This would be of great appeal to sophisticated
clients and of interest to the MDO members.
Once the R-MDO is created, the fundamental question is whether it can meet client needs. This very issue
was discussed in Cyrus Freidheim, The Trillion Dollar Enterprise (Perseus Books, 1998). Freidheim, vice
chairman of Booz-Allen Hamilton, sets out the same elements discussed in this chapter — globalization,
standards and localization — as characteristics that will determine the success of any business the new
economy.
He defines “global” to mean that businesses must serve and have access to clients around the world,
understand customers, meet and anticipate their needs, obtain resources as well as develop market
information. In the professional services market, only the Big 5 have already accomplished this as a result of
their accounting and auditing practices. Law firms, notwithstanding the number of offices, are a long way
from this global coverage.
To be successful, an organization must be able to set world standards. They must show leadership and
innovation, provide value and performance, and have processes, people and capacities that define these
world standards. Many of the large law firms such as Baker & McKenzie and Clifford Chance, are far along on
meeting these definitions. An MDO consisting of the leading firms would have the advantage, since the
highest standards are part of the selection criteria.
Lastly to be global the organization must be local everywhere. Freidheim defines “local” as understanding
local customer markets, having a national image, local workforce and local operations. While the largest firms
may have 50 or more branches, many are not local in that they have few local professionals.155 Some may
argue that localization is not required when advice is being provided for global companies. However, because
lawyers deal with governments, understanding local conditions may be difficult unless the firms are clearly
lock.
Even though the Big 5 may be well on the road to achieving each of these standards by themselves, according
to Freidheim a single entity achieving the highest level of each of these standards is not possible. The only
way to achieve the highest level is through cooperation with similar entities that share a common vision that
he describes as the relationship enterprise. The R-MDO may in fact be the ultimate MDP because it is able to
grow globally to be truly local in every jurisdiction. Beginning with the best firms and companies, it can rapidly
set world standards for services.
Many ethical issues discussed in this treatise can be resolved without changing the existing rules. For
example, the R-MDO could grow to represent all possible clients without conflicts of interest since those
154 Stratton, ABA Voted No MDP: But What About “Virtual” MDPs, 85 Tax Notes 1122-1124 (Nov. 29, 1999).
155 Of the 50 largest law firms worldwide with sizes from 603 to 2732, the percentage of attorneys outside the country ranges from 9% to 60%. There
are only three firms with over 50% and 12 with between 20% and 50% with most in the 20% to 30% range. Law firms are far from global or local in
other countries.
58
Information on professionals, as well as non-proprietary content, would facilitate creating relationships. An
extensive non-confidential knowledge base would be created and shared within the MDO.154
Fourth, access to information on MDOs would not be confined to the participating entities but provided to
clients. Clients could use the information to construct virtual relationships of their own using, as the initial
building blocks, the professionals and services in the R-MDO. This would be of great appeal to sophisticated
clients and of interest to the MDO members.
Once the R-MDO is created, the fundamental question is whether it can meet client needs. This very issue
was discussed in Cyrus Freidheim, The Trillion Dollar Enterprise (Perseus Books, 1998). Freidheim, vice
chairman of Booz-Allen Hamilton, sets out the same elements discussed in this chapter — globalization,
standards and localization — as characteristics that will determine the success of any business the new
economy.
He defines “global” to mean that businesses must serve and have access to clients around the world,
understand customers, meet and anticipate their needs, obtain resources as well as develop market
information. In the professional services market, only the Big 5 have already accomplished this as a result of
their accounting and auditing practices. Law firms, notwithstanding the number of offices, are a long way
from this global coverage.
To be successful, an organization must be able to set world standards. They must show leadership and
innovation, provide value and performance, and have processes, people and capacities that define these
world standards. Many of the large law firms such as Baker & McKenzie and Clifford Chance, are far along on
meeting these definitions. An MDO consisting of the leading firms would have the advantage, since the
highest standards are part of the selection criteria.
Lastly to be global the organization must be local everywhere. Freidheim defines “local” as understanding
local customer markets, having a national image, local workforce and local operations. While the largest firms
may have 50 or more branches, many are not local in that they have few local professionals.155 Some may
argue that localization is not required when advice is being provided for global companies. However, because
lawyers deal with governments, understanding local conditions may be difficult unless the firms are clearly
lock.
Even though the Big 5 may be well on the road to achieving each of these standards by themselves, according
to Freidheim a single entity achieving the highest level of each of these standards is not possible. The only
way to achieve the highest level is through cooperation with similar entities that share a common vision that
he describes as the relationship enterprise. The R-MDO may in fact be the ultimate MDP because it is able to
grow globally to be truly local in every jurisdiction. Beginning with the best firms and companies, it can rapidly
set world standards for services.
Many ethical issues discussed in this treatise can be resolved without changing the existing rules. For
example, the R-MDO could grow to represent all possible clients without conflicts of interest since those
154 Stratton, ABA Voted No MDP: But What About “Virtual” MDPs, 85 Tax Notes 1122-1124 (Nov. 29, 1999).
155 Of the 50 largest law firms worldwide with sizes from 603 to 2732, the percentage of attorneys outside the country ranges from 9% to 60%. There
are only three firms with over 50% and 12 with between 20% and 50% with most in the 20% to 30% range. Law firms are far from global or local in
other countries.
58
