April 11, 2014
In recent years, Midsized Law firms have adapted to technology better than their Large Law counterparts, and they have experienced less volatility in demand growth. Should they continue to incorporate potentially field-changing technologies and remain nimble as the industry shifts and heaves beneath them, they should be well-positioned to prosper in the future.
That is one message from “Industry Focus: A Glass Half Full of Half Empty?”, a Peer Monitor report developed specifically to examine the unique opportunities and challenges Midsized Firms will face in the near future.
The report focused in on Midsized Law firms at a time of great potential. After the recession of 2008, newly cost-sensitive clients began to expect higher levels of predictability, efficiency and cost-effectiveness. They also displayed a willingness to work with “large enough” firms, rather than Large Law firms, if they were able to offer a cost savings. Midsized Law firms were better able to provide those things than Large Law firms were, and so made inroads with clients that, historically, would have been out of their reach.
At present, Midsized Law firms are emerging from a period in which their demand growth has been more stable than that of Large Law firms. They’re also enjoying high realization rates and gathering new business, thanks to clients’ wiliness to “disaggregate” work – sending some work here and some there with the overall goal of spending less on legal services that used to entirely go to Large Law firms.
This is not to say that the outlook is entirely rosy. Overall, demand for Midsized Law firm services declined by 2.7 percent between 2012 and 2013. That speaks to a need, going forward, to attract and retain clients that will sustain a Midsize Law firm’s bottom line – a pressure not unique to Midsize Law firms, but one they’re feeling as acutely as other law firms are.
Ultimately, the picture that emerges from “A Glass Half Full Or Empty” is that Midsized Law firms can capitalize on new business opportunities, but only if they continue to invest in new technologies and strategies that will help them provide the type of work that clients are . For more detailed information you can read the full report here.