Innovation demystified

By Susan Letterman White

I recently read that one-third of lawyers in firms of at least 50 attorneys were pessimistic about adapting to the challenges and changes facing them. Lawyers face problems generating sufficient revenue and operating efficiently, and those are difficult problems to solve.

The change required is innovation, yet pessimism stops innovation before it leaves tracks behind. It will make no difference if I tell you to be optimistic instead of pessimistic; however, there are three things you can do to improve your capacity to innovate: 1) remove obstacles to innovation; 2) look outside, inside and forward; and 3) communicate accessibly.

Remove obstacles to  innovation

In firms, management structures, business models and mindsets are within your control to change.

Management structures that require all partners to agree on all new initiatives often lead to conflicts and an exclusive focus on using any profits to enhance partner revenue instead of earmarking a portion of profits for the research and development of new opportunities.

Long-term solutions are sacrificed for short-term goals. Resources — time and money — are required to pursue opportunities to adopt, integrate or develop new technology, and to explore new ancillary businesses or possible collaborations. If you are a partner, make the case for a new structure to support innovation.

It’s about long-term survival

Business models drive human behavior. The strongest drivers are the compensation and reward policies and processes. They, along with how meetings are run, are most responsible for creating the culture in a law firm.
Know your business model’s unspoken assumptions and then align decisions with those assumptions or change the model. If the model assumes that all successful lawyers in your firm bring in new clients and develop new matters from existing clients, then measure and reward those outcomes and hire and retain only the people who have or can develop those skills.

If your firm’s business model depends on internal cross-selling to existing clients, make sure the incentives are working. If they are not working, fix the problem.

Changing a management structure or business model happens when the lawyers with the power are motivated to make the changes. They are open to seeking new ideas and trying out new solutions when the status quo isn’t generating desired results. They accept reality, embrace new ideas, and use their power to create a different future.

The right mindset makes it possible to accept constraints while working around them and to change them. Skepticism is one footprint away from pessimism, and fast-thinking lawyers may over-rely on their skepticism.
Embracing optimism and possibilities, when the solution is hidden, is a prerequisite to innovation. Change the way you think to enable you to change your decisions and actions.

Lawyers who avoid thinking about technology, client preference changes, and their own strengths and weaknesses quickly and quietly become obsolete.

Look outside, inside  and forward

Innovating and responding to change effectively with an approach that enables thriving begins with taking an honest, long and hard look at one’s purpose and the current and future need for it.

Large swaths of employment, real estate, IP and compliance law are under pricing and automation pressures. New players are entering the legal market space. More services are becoming productized, automated or technology-enhanced.

What is your role as a lawyer?

What are you offering to sell? What exactly do you deliver? In today’s world, it must be more important to the client than what a form or Google provides for little to no cost.

Lawyers, at a minimum, must be more sophisticated in what they bring, beyond their legal expertise, to negotiations and transactions. Their services must be more tailored to the real-life problems of the individuals they help. Your client may be a large corporation, but the person who works with you and approves your bills has problems and a life you should want to make easier and better.

Innovation is about technology and also about creating more value with human-only capabilities in an increasingly digital world. Today, business, personal and legal issues are intertwined. Face reality and use it to redefine your role as a lawyer, what you are offering to sell, and how you deliver solutions.

Lawyers generally help clients retain or recover value. Innovative lawyers will figure out how to help clients discover and create new value. They will be strategy partners. They will help their clients figure out how to use blockchain to share and convey data securely, code royalties into the access of IP, navigate and succeed in borderless transactions, track assets (including cryptocurrency), and, most important, think of new ideas.
Communicate accessibly

We communicate with ourselves and others constantly. Innovation depends on an ability to think conceptually and in practical terms, and to see patterns and connect seemingly disparate ideas. To do that well, explain things like you are talking to a 10-year-old. Train yourself to think and speak in a clear, easy-to-understand, and practical (not only conceptual and theoretical) way.

Think and talk about outcomes, not what you will do for clients. Discover what your clients and prospects want to accomplish and tell them how you will make it easier. Innovation happens in a developmental phase, where collaboration leads to new ideas.

Lawyers generally want to deliver a perfect solution to clients, and doing so without the assistance of the person who should see the value in the solution is difficult. Collaborate with your prospects and clients to create the value that makes their lives easier and better.

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Susan Letterman White  is a practice advisor at Massachusetts LCL/LOMAP, an adjunct professor at Northeastern University, and the principal consultant at Letterman White Consulting.

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