In Part 1, we saw that Keith Mayfield, chairman of an AmLaw 100 firm, was finding it lonely at the top. I observed that law firm leaders have few internal advisors who think about their firms as businesses, the way these leaders must. I expressed my belief that one thing they're not hearing is that knowledge strategy should be part of the firm's execution plan, whatever its overall strategy. My hope for this blog is to shed light on this under-appreciated area of practice management, and to demonstrate the power of successful knowledge strategy initiatives.
So what is knowledge strategy?
Knowledge strategy is an old subject, but underdeveloped at most firms, even at those with Knowledge Departments and Chief Knowledge Officers. Knowledge is what lawyers know about their past work, what they know about their clients, what they know about their business and what they know about the competition. The challenge is how to capture and share this knowledge. Examples of ways to share knowledge are listed later in this post.
Lawyer personality traits
The key to sharing knowledge is to understand the special personality traits of lawyers, and to establish an approach that addresses, or even embraces, those traits. As you know from leading your firm, lawyers are:
- averse to change,
- focused – to the exclusion of all else – on getting the client work done,
- yet very interested in learning new things.
Psychological studies have confirmed that lawyers do, in fact, differ in these ways from the general business population. (See, for example, “Herding Cats – The Lawyer Personality Revealed,” by Dr. Larry Richard, Managing Partner Forum, 2011.) As in the case of any significant law firm initiative, know-how sharing requires an approach that takes these personality traits into account and, ideally, harnesses them in support of the new initiative.
Benefits of knowledge strategy
When done successfully, knowledge strategy can produce benefits such as these:
- Facilitate fee benchmarking for use in alternative fee arrangements by breaking down lawyer time by sub-parts of matters, and adding information about context. For example, showing that the fee attributable to the discovery portion of the litigation was W dollars and involved X depositions and Y witness preparations and Z pages of document production.
- Aid in identifying comparable matters for purposes of setting alternative fees, finding relevant precedent, preparing pitch books and staffing matters with lawyers having relevant experience.
- Permit generating internal and external reports about trends and other granular aspects of transactions in a given category during the prior quarter or year.
- Help quickly find the firm's expert on a particular legal issue.
- Enable junior lawyers to take on more senior work, thereby increasing leverage and profits per equity partner.
- Reduce risk by improving the consistency and quality of professional work product.
- Streamline some partner non-billable work, freeing them to take on profitable client work.
Examples of knowledge strategy
Knowledge strategy encompasses the following activities and resources:
- Quality lawyer training, feedback and mentoring that not only imparts relevant senior lawyer experience to more junior lawyers, but also shares lawyers expertise among colleagues.
- Effective practice group meetings that discuss current issues, promote group communication and include training.
- Establishment of a sense of community in practice groups and a culture of sharing knowledge.
- Good precedents and model forms.
- An effective work product search and retrieval system.
- A system for locating internal subject matter experts.
- A repository of firm experience on each matter that includes factual details about the matter, commentary about context and billing information broken down by sub-parts of the matter.
- Easily accessible knowledge about client needs, current firm work for the client and competitors for the client's work.
These are merely examples. Knowledge strategy cuts across most aspects of law firm life. It's relevant both to firms of 100 lawyers and large firms of 1,000 lawyers or more.
Why knowledge strategy has been unsuccessful at most firms
Knowledge strategy is not about technology, any more than drafting a client memo is about word processing software. Unfortunately, at most firms knowledge strategy has been relegated to technology status. I call it “knowledge technology.” The reason for that can be traced to the lawyer personality traits previously described. Knowledge initiatives can be gold mines if successful, yet to be successful they require involvement by lawyers and changes in the way lawyers work. These initiatives generally cut against most of the lawyer personality traits, though. Even a senior administrator in the firm who was previously a practicing lawyer will likely fail in pursuing a major knowledge initiative without visible and involved support from firm and practice group leadership. That leadership involvement is the difference between “knowledge management” and “knowledge strategy.” Having experienced failure, these administrators resort to solutions that rely on technology instead of lawyers. The result is often an expensive system that lawyers don't use because it doesn't give them the knowledge they need.
Future posts will expand on the ways in which knowledge strategy can achieve the benefits described above, and how to work around – or work with – the lawyer personality traits that have frustrated many well-intentioned efforts. Some posts will focus on big picture issues; others will suggest very specific initiatives. We will also learn more about how Keith Mayfield is managing.
[Photo credit: © pzAxe / www.fotosearch.com]
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