model because there are no capital,
management or conflict issues to
contend with.
of the Legal Market from Georgetown
University Law Center and Peer Monitor
released in January, the law firm market
has become much more intensely
competitive over the past five years, and
has shifted from a sellers' market to a
buyers' market.
"Fundamental decisions about how
legal services are delivered including
staffing, scheduling, strategies and how
firms charge for their services are
increasingly being made by the clients,
and not by the law firms," a press release
about the report stated. "Clients are
increasingly pushing back on these issues
and more."
Jones, the lead author of the report,
said clients are interested in a more
efficient and cost effective delivery
of legal services, creating a "golden
opportunity" for smaller firms.
"This is all good news for firms the size
of Primerus firms if they manage to take
advantage of it," he said. To do that, firms
need not just be small, but also nimble
and flexible in responding to client needs.
"They must watch what's going on in
the market and be ready to respond in
ways that larger firms cannot," he said.
"It requires a real strategic focus."
movement of business to smaller firms
and a resulting reduction of market share
for larger firms, Jones said. "This is the
time (for smaller firms) to shine by trying
to think creatively about how to deliver
services more efficiently."
The report cites a recent survey
conducted by AdvanceLaw, in which
general counsel at 88 major companies
were asked about their willingness
to move high stakes work away from
"pedigreed firms" (defined as AmLaw 20
or Magic Circle firms) to other law firms,
assuming a 30 percent difference in cost.
The survey showed that 74 percent would
be inclined to use the "less pedigreed"
firm. The survey also revealed that 57
percent of respondents found lawyers at
pedigreed firms to be less responsive,
while only 11 percent found them more
responsive, the report said. The report
also cited an Altman Weil Chief Legal
respondents indicated they had shifted
work to lower-priced outside law firms in
the previous 12 months.
"What these results suggest is that
brand value in this case the brand
value of the largest and historically most
prestigious firms in the legal market may
be losing some of its luster as increasingly
savvy general counsel select outside law
firms based on considerations of price and
efficiency and not on reputation alone,"
the report said.
member firm Garbett, Stiphany, Allen
& Roza in Miami, Florida, has found
this trend to be true at his firm, which
specializes in commercial litigation,
banking and finance, intellectual property
and antitrust litigation, and commercial
real estate and transactions. For 25 years,
the firm has been the same size in the
12- to 14-lawyer range.
"It's a new economy, and more
and more we are able to compete on a
value cost basis more than large firms
for a simple reason we don't carry
the overhead," Stiphany said. "We can
pass along a lower, more flexible fee
arrangement than a large firm, particularly
when there's volume involved. At the same
time, we can give them excellent quality."
Stiphany said that in fact, three of the
four shareholders in his firm came from
lower, more flexible
a large firm, particularly
when there's volume
involved. At the same
time, we can give them
excellent quality."